Evictions, homelessness and debt will all rise if the government’s ‘chaotic’ Universal Credit roll-out continues across Birmingham, ministers have been warned.
The stark warning comes form the city’s Multi’Agency Welfare Reform Implementation Group (MARIG) which has been studying the impact of changes to the benefit system.
It has joined critics from across the political spectrum who fear that a new payment, which is to replace six other key benefits, will be paid a month in arrears leaving hard-up families worse off.
In pilot schemes about a quarter of claimants have waited six week to receive their money leaving them unable to cover basic living costs and facing eviction.
Currently around 3,000 Brummies receive Universal Credit for their housing costs but that is set to soar to more than 60,000 after the scheme is fully rolled-out next month.
The six-in-one benefit is due to replace income-based Jobseekers’ Allowance, housing benefit, child tax credits, income support, working tax credit and Employment and Support Allowance.
MARIG Chairman cllr Tristan Chatfield has written to Secretary of State for Work and Pensions David Gauke MP to voice concerns.
The Birmingham Labour cabinet member said: “If the roll-out goes ahead as planned, there is no doubt that we will see an increase in homelessness and debt, just as we’ve already seen in other areas of the country.
“We know from the pilot areas that rent arrears increase significantly when Universal Credit is introduced, because, for many vulnerable people, the switch from multiple benefits paid in stages, to a single monthly payment in arrears with a built in delay, provides too much of a cliff edge.
“That will have disastrous consequences for many people across Birmingham who are already struggling to make ends meet.
“We’re urging the DWP to take steps now to significantly reduce the risk of unintentional homelessness as Universal Credit is introduced across Birmingham. There must be a sensible approach to avoid the massive problems we’ve seen elsewhere in the country.”
The Group is also talking to homelessness charities, housing providers and landlords to see if action can be taken to avoid people being evicted due to delays in payments.
Work and Pension secretary David Gauke earlier this week insisted he would plough on with the flagship welfare reform despite warnings and criticism - some from Tory backbenchers.
He said Universal Credit was helping people back into work and no-one should go six weeks without money, which has been linked to rent arrears and other debts for claimants.
He said: “Nobody who needs support should have to wait six weeks before they receive any support, and what we’re doing is making clear that people can receive an advance of their first month’s payment.
“That is then deducted over the next six monthly periods, and that is helping people deal with the cashflow issues in that first month.”