PUC0003

Written evidence submitted by The Money and Mental Health Policy Institute

Introduction

The Money and Mental Health Policy Institute is a research charity established by Martin Lewis to break the vicious cycle of money and mental health problems. We aim to be a world-class centre of expertise developing practical policy solutions, working in partnership with those providing services, those who shape them, and those using them to find out what works. Everything we do is rooted in the lived experience of our Research Community, a group of 5,000 people with personal experience of mental health problems.

This written submission has been informed by the experiences of our Research Community, including a 2022 survey with 248 people with lived experience of mental health problems. The survey explored the experiences of two groups of people: 100 respondents who’ve already moved to Universal Credit (UC) from legacy benefits, either by natural or voluntary migration, and 148 respondents on legacy benefits who are likely to be subject to managed migration.[1] This response also draws on our wider body of research. Unless otherwise specified, all quotes in this response are drawn directly from the Research Community.

In this response, we have provided evidence on how and where the Department for Work and Pensions (DWP) could improve the support it provides to vulnerable claimants as part of the UC managed migration process.

Background

●        In any given year, one in four people will experience a mental health problem which affects their cognitive and psychological functioning.[2] Over a lifetime, this proportion rises to nearly half the population.[3]

●        There is a large and sustained employment gap between people with mental health problems and those without. The size of this gap varies by condition: people with mild anxiety or depression had an employment rate 6 percentage points lower than the overall population in 2014, rising to 28 percentage points for those with severe anxiety and depression.[4]

●        People with mental health problems are more likely than the rest of the population to receive benefits.[5] A 2014 snapshot found that nearly half (47%) of working-age adults receiving an out-of-work benefit have a common mental disorder, such as depression or anxiety. People with more severe conditions were much more likely to receive Employment and Support Allowance (ESA), with it being claimed by more than one in five people with severe anxiety or depression (21%), post-traumatic stress disorder (22%), bipolar disorder (21%) or who had attempted suicide in the past year (23%).[6]

●        Lower employment rates and lower wages when in work, combined with the low level of financial support benefits provide, mean people with common mental disorders like anxiety and depression have typical annual incomes of just two-thirds (68%) of those without those conditions. This is equivalent to a gap of £8,400 per year.[7]

●        Common symptoms of mental health problems, such as reduced concentration and increased impulsivity, present significant barriers for people with such conditions who are told to migrate to UC. This raises the risk that people with mental health problems will face serious financial and psychological harm as a result of the managed migration process.[8]

Summary

●        The experiences of people with mental health problems who are already in receipt of UC evidences the barriers this group can face to the managed migration process. There is a risk that in the managed migration process, tens of thousands of people with mental health problems may find themselves cut off from their benefits.

●        Among survey respondents who had already made the move to UC, four in five felt their mental health problems had negatively impacted their ability to make an application, and two-thirds found it difficult to complete at least one task involved in making a claim.

●        Nearly all respondents who are still receiving legacy benefits said they are worried about migrating to UC, with particular concerns about reduced entitlements and difficulties coping with the five-week wait. More than eight out of ten reported they’ll need support to move to UC, yet only two in ten know where to access support.

●        While we welcome the decision to postpone migrating those in receipt of just income-based ESA or income-based ESA with Housing Benefit (HB) onto UC until 2028,[9] we are concerned that the DWP are not making the necessary changes to improve the process for people with mental health problems in the meantime.

●        And there’s still limited detail on how the DWP proposes to identify, support and safeguard those who need more support or reasonable adjustments for their disability during the managed migration process.[10]

●        As a priority, to prevent the sudden and avoidable loss of peoples’ incomes, the DWP should publicly guarantee that it will not stop the benefits of anyone who is migrating until they've made a successful claim.

●        To maximise the number of people who successfully migrate, the DWP should communicate with individuals in advance of migration notices to provide reassurance, alleviate fears and ensure notices are designed and delivered in a way that makes it more likely that recipients are able to engage and respond.

A note on terminology

This submission refers to “people or individuals in vulnerable situations” rather than “vulnerable claimants”. This is because vulnerability is not a characteristic inherent to a person but often is situational, and the term claimant can be dehumanising. However, there are instances in this submission where its use has been upheld for continuity with DWP communications and the themes of this inquiry.

Support for vulnerable claimants

At the end of 2022, there were around 2.5m households in receipt of legacy benefits.[11] Since then, the DWP has started to scale up its process of migrating people onto UC. It first focused on people in receipt of Tax Credits and has since expanded this to include people in receipt of Tax Credits in combination with other benefits, as well as people who just receive HB, Income Support (IS), or income-based Jobseekers Allowance (JSA).[12] Crucially, this includes people in receipt of income-based ESA and Child Tax Credits (CTC), many of whom will have a mental health problem. The DWP expects around 440,000 legacy benefit recipients to be moved to UC in 2024-2025.[13]

Those in receipt of income-based ESA are some of the most severely affected by their medical conditions - including mental health problems. As of August 2023, there were 777,631 people in receipt of ESA whose primary health condition was a mental health problem,[14] and many thousands more with a secondary mental health condition or undiagnosed.[15] While we welcome the decision to postpone migrating those in receipt of just income-based ESA or income-based ESA with HB onto UC until 2028,[16] we are concerned that the DWP are not making the necessary changes to improve the process for people with mental health problems in the meantime. It’s vital that steps are quickly put in place to learn from and improve the managed migration process for people with mental health problems. This would help those with such conditions who are already struggling with the process and ensure vital protections are put in place before more people on ESA - who will include those in vulnerable situations - are migrated across.   

Research we conducted in 2022 identified three key difficulties facing individuals subject to managed migration and their ability to successfully make a claim for UC, specifically: reduced capability in completing tasks required in making a claim; fears about the migration process and its consequences; and limited awareness of, or ability to get, support.

Reduced capability in undertaking managed migration tasks

Common symptoms of many mental health problems, such as difficulty with clarity of thought and depleted energy levels, can make the UC claim process harder to navigate. Almost four in five (79%) respondents to our survey who had already moved to UC agreed that their mental health problems had negatively impacted their ability to apply for UC.[17] Of respondents who had already moved to UC under natural or voluntary migration, two-thirds (66%) found at least one task involved in making a claim difficult.[18] While this group ultimately managed to navigate the process successfully, for many, it was an arduous undertaking that exacerbated their mental health problems and threatened their income.

“My very first time applying for UC? I was in the middle of a mental health crisis. Applying for UC didn't seem important as I couldn't see a future.” Expert by experience - UC claimant

The task that respondents who had already moved to UC found hardest was providing medical evidence, with seven out of ten (71%) reporting that this was difficult. Over half of respondents (53%) found completing the online application form hard, and over four in ten (44%) found using the digital online system tricky.[19]

Given these common difficulties, there is a very real risk that the tasks involved in making a UC claim will prove too difficult for many with mental health problems subject to managed migration, and they'll fall through the cracks. Unable to respond to migration notices or reach out to signposted support services, they risk their benefit incomes being cut off simply because they’re too unwell to comply with the managed migration process.

This concern becomes especially pressing when you consider that 21% of Tax Credit recipients who have been sent a migration notice did not claim UC and had their legacy benefit payments terminated.[20] Especially in light of the fact that these individuals were receiving, on average, £300 a month in Tax Credits.[21] We are concerned about how much worse the picture could look when those in more vulnerable situations (the ESA only group) start getting moved across.

We are also concerned about the reduction in DWP communications to individuals concerning managed migration. During the early stages of managed migration, the DWP used a range of ways to communicate with individuals to make them aware of the managed migration process and what they needed to do to continue receiving benefits.

●        Individuals would first receive migration notices by post; if undeliverable, they were temporarily excluded until their address was confirmed.

●        The DWP also sent multiple reminders via letters, texts, and calls to ensure individuals fully understood the implications of not claiming UC by the deadline.

However, the DWP no longer calls all tax credit claimants who are approaching their deadline. Given the percentage of such individuals who haven’t made a claim for UC, there’s concern that this scale-back of support is leaving people at risk of losing out financially, due to not understanding the implications of not responding to their migration notice.[22] This is an especially pressing concern for people with mental health problems, who can face additional challenges in understanding and responding to their migration notice.

Finally, extensions can be provided to people’s managed migration deadline, and guidance provides non-exhaustive examples of circumstances in which there might be a good reason to grant this.[23] Yet managed migration reminders don’t state this provision, which creates the potential for unnecessary, additional stress and anxiety for those unable to engage with the process before their deadline due to mental health problems.

Fears about the managed migration process and its consequences

Beyond the difficulties completing specific tasks involved in applying for UC, levels of anxiety about moving to UC were across the board extremely high, with 97% of respondents to our survey on legacy benefits agreeing that they were worried about migrating.[24]

“I'm not the world's quickest person at responding, so I'm scared I will run over time limits, and I will get sanctioned before I've even made a claim.” Expert by experience - Legacy benefit claimant

We have identified three pain points in the UC system which are driving fears around migrating. The DWP has offered partial solutions to these challenges. Yet, some of the measures are insufficient, and others fail to reach the claimants needing them.

1. Fears about reduced entitlements under UC

Nearly all (95%) legacy respondents were worried about receiving a lower entitlement under UC.

“I'm terrified of having to move over, and I'm not sure why. Maybe it's the horror stories I've heard and the suicides that have happened after being left for weeks without no money, so no heat or food etc.” Expert by experience - Legacy benefit claimant

This concern is being exacerbated by the DWP not effectively communicating messages about transitional entitlement protections, thereby missing opportunities to dispel fears and provide reassurance. The current lack of clarity is also hampering welfare rights advisers' capacity to determine an individual's entitlement accurately and assist them in making informed budgeting choices regarding managed migration.[25]

The DWP does not explain the erosion of transitional protection on the current managed migration notices, which makes it hard for individuals to understand when best to time their managed migration to UC. Some changes cause transitional protection to end entirely, such as relationship changes or a period of unemployment.[26]

Furthermore, CPAG’s research has found that individuals are routinely unable to find the information they need to help them plan and budget during their move to UC. Not being able to find answers to questions such as how much they would receive on UC, when their tax credits would end and when their first UC payment would be, increases anxiety about moving to UC.[27]

2. Difficulties waiting five weeks for a first UC payment

Nine out of ten legacy respondents to our survey (91%) were worried about having to wait a month for the first payment.

To address this, the DWP introduced two key policies. Advance payments to support people who have insufficient funds to live on during the five-week wait, and a two-week run-on payment for some legacy benefit recipients.[28] Notwithstanding the wider debate around the suitability of advance payments as a solution to the five-week wait,[29] the fact remains that people are not always aware of these options ahead of migration notices, and this can drive panic and fear.

Further compounding concern is a lack of information about Advance Payments and two-week run-ons of legacy benefits in the latest iterations of the managed migration notice shared by the UC Stakeholder Engagement Team in February 2024. This information does exist in the Universal Credit general information pack, but only in the form of an overview of how UC’s monthly payments work. There’s no explicit explanation about the five-week wait for a first payment. Expecting people with mental health problems to seek, digest and interpret this information in the information packs that accompany their notice is unrealistic, given the challenges this group can face with concentration and processing information.[30]

“I was unaware that I was able to apply for an advanced payment. I literally did not eat for nine days.” Expert by experience - UC claimant

3. Challenges managing money across a four-week period

Just under three-quarters of legacy respondents (73%) to our survey were worried about the change from fortnightly payments under their current arrangement to monthly payments under UC, and their ability to manage this.[31] There are significant concerns around individuals’ abilities to budget on a monthly basis and how this poses an increased risk of people being left without any funds at all.[32]

“Currently, my housing benefit is paid directly to the council, but I've been told the money will come to me, and I have to pay it to the council. I'm worried that if I'm manic, I'll see that money in my bank and go out and blow it. I need not to have access to it.” Expert by experience - Legacy benefit claimant

To address this, the DWP introduced alternative payment arrangements (APAs). Two types of APAs - the option to have more frequent payments and/or have housing costs paid directly to landlords - are particularly relevant for people with mental health problems.[33] Yet, despite the guidance identifying mental health problems as a circumstance which might mean an APA is required,[34] and an evident need and demand for these alternative processes,[35] they are not well utilised. Only 2% of individuals have taken up the offer of more frequent payments, and only 20% of those with housing costs have their rent paid directly to landlords.[36]

Limited awareness or ability to get support

Against the backdrop of these pain points in the system, over half (53%) of people responding to our survey who had already moved to UC found completing the online application form difficult.[37] Yet six out of ten (60%) respondents did not receive any help to make a claim.[38] Of those who did have support, three in ten (30%) received help from a professional involved in their care. This paints a picture of people struggling with the transition to UC and the systems they’re required to navigate, yet the support services available to help people move to UC are not being fully utilised.

Of respondents still to migrate to UC, more than eight in ten (85%) agreed they will need someone to support them to move to UC.[39] Yet, despite there being help including the government-funded Help to Claim service delivered by Citizens Advice, only one-fifth (20%) of respondents know where to go for support.[40] CPAG’s research has found that very few people are calling the managed migration helpline for more information, with mixed results when they do. Even fewer are seeking independent advice. The vast majority are seeking information online which often leads to further confusion and leaves some individuals worse off financially in certain instances where misunderstandings about managed migration occur.[41]

The DWP does signpost individuals to relevant support services in migration notices. However, this approach is insufficient for many people with mental health problems, particularly those who are acutely unwell or in crisis. Difficulties with motivation, memory or self-advocacy can mean that people struggle to reach out to sources of support even when provided with information and contact details.[42] Some people are simply too unwell or overwhelmed with the number of tasks required of them and struggle to take any action. Others may reach out to support services they’ve been signposted to, but difficulties managing stressful situations can mean long hold times on the phone, or difficult online processes prove to be too much.[43]

What’s more, people with mental health problems can face barriers to accessing the Help to Claim service. Contractual changes introduced in April 2022 mean the service is no longer provided face-to-face and is only available through telephone and digital channels.[44] This narrowing of delivery channels risks some of those with the most complex needs, including mental health problems, falling through the gaps.

Finally, as our previous research has shown,[45] people with mental health problems can face challenges getting vital help from third parties to manage their UC claims. Most notably because of the restrictive explicit consent model for UC. This is especially concerning in relation to the managed migration process, which can give rise to many complex issues. Whereas the system of managing tax credits is quite light touch, with many individuals only having to engage with the system annually. In contrast, managing a UC claim is a lot more intensive and can require engagement from individuals every month. Individuals who previously handled their tax credit claims independently may now need to grant explicit consent to other parties to manage their UC award.

The DWP has taken some steps to improve the explicit consent model.[46] In February 2023, the department introduced a change to provide work coaches with a designated place on the UC system to record an individual’s explicit consent, making it easier for other agents to check if explicit consent has already been granted. The DWP is also collecting data on the use of explicit consent to inform future improvements, such as changes to how individuals can give consent through their online account.[47] Although these alterations to the system are appreciated, additional changes are required to ensure that people can get the support they need to make and manage their UC claim, as we will outline at the end of this submission.

Limited identification of claimants in vulnerable situations

A final, overarching concern we have about DWP’s ability to support individuals in vulnerable circumstances through the managed migration process, is their current inability to adequately recognise, record and respond to vulnerability. From the experiences of our Research Community, it’s clear there is either a lack of process for adequately identifying individuals in vulnerable situations and providing support in response to this identification - or problems with the implementation of DWP processes that intend to support and protect such individuals.[48]

If the DWP continues to fail to effectively identify and support people with mental health problems during the managed migration process, then many individuals with such conditions will be unsuccessful in claiming the full award or support they are entitled to.

The DWP also consistently fails to ask people with mental health problems whether they need reasonable adjustments.[49] And there’s limited detail on how the DWP proposes to identify, support and safeguard those who need more support or reasonable adjustments for their disability during the managed migration process.[50] We therefore, have justified concerns that many people with mental health problems risk falling through these avoidable gaps.

How can the DWP better support those in vulnerable situations through the managed migration process

We have long been calling for the managed migration process to be improved so it better meets the needs of people with mental health problems. But to date, limited steps have been taken to achieve this. The DWP have at least acknowledged that they will need to provide more support to those migrating from legacy benefits who are in vulnerable situations from April 2028. And they’ve proposed that for people in receipt of IS or ESA with CTC who haven’t applied for UC after their migration letter and two reminders, they will: check for evidence as to why they haven’t made a claim, call these individuals to ask about any barriers they are facing to making a claim, and arrange home visits where needed.[51] These steps fail to provide a vital safeguard against someone’s income being cut, or optimise people’s ability to migrate to UC, though.

In light of the challenges people with mental health problems can face when migrating to UC, the DWP should provide a guarantee that they will not stop anyone’s legacy benefits until they have successfully made a claim for UC. This would provide a vital safeguard to all individuals, including those who have mental health problems but may not have a diagnosis or be unaware they’re experiencing a mental health problem.

While this option is optimal, we are aware the DWP is committed to completing migration and sees this safeguard as a potential deterrent to individuals responding to migration notices and moving over to UC. Therefore, as an alternative, but less preferable option, the DWP should, at the very least, provide a guarantee it will not stop the benefits of anyone the department knows is vulnerable as part of the migration process. In light of the above stated concerns about how many people are falling through the gaps of DWP’s identification of vulnerable, this should include but not be limited to all those in receipt of ESA and Personal Independence Payment (PIP). This would mitigate some risk of harm and safeguard some individuals in the most vulnerable situations.

The priority recommendation to safeguard individuals must be accompanied by immediate practical changes by:

1. implementing measures to communicate with people preemptively to address fears and provide reassurance; and
2. delivering migration notices in a way that optimises individuals; ability to respond to them.

These combined measures will have the benefit for DWP of minimising the number of people who would end up needing the safety net outlined above.

1. To communicate with claimants preemptively in advance of migration notices to address known fears, the DWP should:

●        Provide advanced and clear notifications of the five-week wait for payment to individuals who will not automatically receive the two week run on payment. And reference the option for people to receive an advance payment within the migration notice as well as the information pack.

●        Be more transparent about explaining the erosion of people’s transitional protection in migration notices, so individuals can be better informed about how their finances could be affected by moving to UC.

●        Signpost to benefit calculators in migration notices. An important first step, however, is clarifying how transitional protection is being calculated so benefits calculators can more accurately tell people what they will receive on UC.

●        Provide information that accompanies people’s migration notices, outlining how the specific legacy benefits they receive will convert to UC payments.[52]

●        Proactively offer budgeting support to all claimants subject to managed migration to assist them with moving to monthly payments.

●        Actively promote housing cost and frequency of payment APA’s to individuals in vulnerable situations, including those in receipt of ESA and/or PIP and who previously had housing costs paid directly to landlords.

2. To optimise individual’s ability to respond to migration notices, the DWP should:

●        Routinely record individuals’ communication preferences and, in addition to formal written notices and reminders, communicate with people via their preferred channel.

●        Reinstate sending reminders about the managed migration process via a range of communication channels. This is especially crucial for individuals whose communication preferences haven’t been recorded. These reminders should inform people about the steps they need to take to maintain their benefit payments and should be delivered via letters, text messages, and phone calls.

●        Ensure the tone of communications is reassuring, reminding people of the options available to them around transitional protections, two-week run on payments, advance payments, budgeting support and help with making a claim. Information should be provided in simple and accessible language, acknowledging the anxieties this may provoke and providing a point of contact for support.

●        Explicitly mention extensions and how they can be requested in reminder letters.[53]

●        Reinstate face-to-face delivery of the Help to Claim service in the next round of commissioning.[54]

●        Allow for better third-party access[55] so everyone can make the transition to UC safely and manage their award on an ongoing basis. Central to achieving this, is clearer and more consistent prompts on what information is required to obtain explicit consent. A drop-down menu clarifying exactly what information individuals’ wish to share and for how long - would also avoid needless financial and psychological harm.

Finally, we want to see the DWP commit to transparency with stakeholders on the iterations of managed migration. Those working in the welfare benefit sector have grave concerns that individuals in vulnerable situations are being placed at risk - and that difficulties responding to migration notices will lead to people's incomes being cut off, with potentially devastating consequences.[56] The DWP should commit to transparency around the precise steps they are taking to engage and protect individuals in vulnerable circumstances.

March 2024