Written evidence from Child Poverty Action Group (CPAG) [SWP0064]

 

Child Poverty Action Group (CPAG) works on behalf of the more than one in four children in the UK growing up in poverty. It doesn’t have to be like this. We use our understanding of what causes poverty and the impact it has on children’s lives to campaign for policies that will prevent and solve poverty – for good. We provide training, advice and information to make sure hard-up families get the financial support they need. We also carry out high profile legal work to establish and protect families’ rights.

 

Throughout this submission we have included examples (in italics) from CPAG’s UK-wide Early Warning System (EWS) – based in our Glasgow and London offices. EWS collects and analyses case evidence about the impact of changes in the social security system on the wellbeing of children, their families and the communities and services that support them.

 

The combination of our social security expertise with analysis from the EWS enables us to provide positive feedback about what is working well in legislation, administration and impacts on families, but also to quickly identify emerging issues that can be addressed to ensure positive interactions with the social security system and the best outcomes for children and their families.

Summary

The universal credit (UC) system appears to be functioning in the way it was designed for the majority of claimants; however CPAG has received a significant number of reports of new and existing claimants who are experiencing problems. The majority of the new claimants will still be in their first assessment period and will not yet have received their first payment after which the position may be different.

 

Many claimants require support to make and maintain a UC claim online, and are not able to access that support due to social distancing and are unable to get through to DWP on the phone. The online nature of UC makes it almost impossible for advisers and support workers to provide assistance to clients remotely.

 

DWP’s response to the influx of claims e.g. relaxation of ID verification and requirement to attend the Jobcentre has removed some of the barriers to claiming UC and consideration should be given to retaining these measures after the pandemic ends.

 

Evidence highlights that people are confused about which benefit and/or income replacement scheme would be appropriate for them and clarity is required about how the government schemes will interact with the rest of the social security system.

 

People are confused about the difference between self-isolating and shielding and their consequences for benefit entitlement. Following shielding advice did not (until today, 16th April 2020) give eligibility for SSP or ESA, so a number of people who were unable to work due to an underlying health condition, but not furloughed or self-employed, may have had to claim UC. 

 

Families are worried about the increased costs of food, bills and having their children at home all the time. We welcome the recent uplift to UC and Working Tax Credits (WTC) however unless other legacy benefits are uprated in line with these recent uplifts those on legacy benefits will be left struggling. There is also nothing in the package of support announced by government that acknowledges the additional costs of raising children.

 

Many claimants will not feel the benefit of the increased UC and WTC standard allowances due to their entitlement being capped. Furlough pay at 80% of normal wages may not be sufficient to exempt them from the benefit cap if they have had a gap in employment in the previous 50 weeks.

 

The two child limit will reduce entitlement for a number of families who were previously able to support themselves through work, forcing them into poverty.

 

People claiming UC after a legacy benefit stops due to bereavement, for example the loss of a partner or child, will not benefit from the bereavement protection that is afforded to someone who is already claiming UC before the death.

 

People are struggling to claim new-style employment and support allowance (ESA) without starting a claim for UC. Both may be claimed together online but to claim ESA alone, claimants must telephone and often encounter staff who insist that both benefits must be claimed together.

 

We were hearing of issues of personal independence payment (PIP) assessments being delayed prior to the outbreak of the pandemic for new and existing claimants. Some awards ended simply because a new assessment had not been carried out. It was announced that awards due to end after 23rd March will automatically be extended, but there is a cohort whose awards ended before that date.

 

There are some groups who are still not able to access UC:

 

 

1.       How well is the Universal Credit system working for the unprecedented numbers of new claimants?

 

The DWP has responded quickly to phenomenal changes in its workload. Evidence collated so far suggests that despite the tremendous amounts of new claims, the UC system still functions in the way it was designed to, for the majority of claimants.

 

CPAG’s Early Warning System has captured numerous individual cases illustrating problems arising in the claim process, which have now been mitigated by recent measures. Below, we focus on the concerns that have come to our attention since new measures were announced and brought into force.

1.1   Starting a claim online

The Early Warning System has heard that people who need additional support are encountering barriers to starting their claims, exacerbated by the high number of claimants at this time, placing them at an even greater disadvantage.

 

The Early Warning System has not recorded any cases of new claimants who have IT access and IT literacy, having any problems completing the online forms overall. However, we have received some queries about how certain questions should be answered and logged concerns about stages in the claim process such as ID verification and medical assessments.

1.1.1          Unsupported claimants

Many UC claimants require additional support to start a claim. They may have no internet access at home, lack a computer or smartphone, or have a low level of digital capability. They may have a health condition or disability which affects their ability to manage a benefit claim without support. Such claimants would usually have access to resources and face-to-face support from local services or charities.

 

Current social distancing requirements mean no such support is available. Those who are able may start a UC claim by telephone but encounter considerable problems accessing this option (more on telephone line delays below at section 2).

 

Client has no access to internet or smartphone at home. She has been trying to start a UC claim over the phone but has been cut off, also upset by rudeness and unhelpfulness of staff. #U906 07/04/2020

 

Client is self-isolating and has no access to IT, can't get through to DWP on phone to claim UC. Adviser is considering making the claim for them. CPAG advised data protection considerations and Help to Claim may be better option to protect claim start date. #886 24/03/2020

 

Current backdating provisions mean that people, whose claim start date is delayed while they wait for the support, lose out on money to which they’re entitled at a time when it is sorely needed. UC can only be backdated for a maximum of one month in limited number of specified circumstances.

 

Recommendation: CPAG recommend that the period specified in regulation 26 of the Universal Credit (Claims and Payments) Regulations be extended to 3 months with no specific reason for claiming late required (as with child benefit and ESA) for the duration of the pandemic.

1.1.2          Claim questions

We do not yet have a complete picture of how well the system is working because the majority of claims were made in the last few weeks and are yet to receive the first UC award. We know from our previous work[1] that errors in entitlement amount can arise due to the automated nature of calculations and their reliance on the UC claim questions.

 

Before the outbreak, CPAG understands the DWP were already reviewing some claim questions which may lead to an incorrect award. With the influx of claimants, the amount of incorrect awards may increase.

 

Aspects of claim questions/automation DWP are already looking to review:

a)       Surviving partners receiving Carer’s Allowance run-on following their partner’s death are not automatically receiving the Carer’s Element of UC because they’ve answered “no” to the question “are caring for someone with a health condition or disability?”

b)      Joint tenants who are liable for all the rent since their partner left the property are automatically receiving only half the housing costs element to which they’re entitled because the system doesn’t cater for this common scenario.

 

Since the outbreak, CPAG’s Early Warning System has received queries about how furloughed workers should answer the claim question “are you currently working?” If they select “no” to this question, they may find that their claim is not linked to the Real Time Information system which updates the DWP as to their earnings, and are subsequently overpaid UC calculated without taking any furlough pay into account.

 

Furloughed employees may not know how to answer the questions about their work hours and usual earnings.

 

CPAG’s experience is that UC questions take an inordinately long time to adjust, even where they systematically lead to errors in entitlement. The issues highlighted above were first raised over 2 years ago and the automated system still produces the same errors every time.

1.1.3          Online ID verification

Once the claim form has been submitted, claimants must verify their identity to progress the claim, and crucially, access the UC advance.

 

In late March, CPAG received numerous reports that claimants who had appropriate documents (passport, driving licence, credit card) to verify their identity online were nonetheless unable to complete the process and obliged to telephone DWP to ensure their claim would progress.

 

The bottle neck in the Verify system forced claimants to seek alternative means of completing verification. The DWP’s phone lines were swamped (see section 2 below).

 

We have seen a notable shift in the DWP’s approach to verifying identity in response. CPAG notes that the DWP’s previously very rigorous approach (often requiring an ID verification interview for claimants who had successfully verified their identity online) is in stark contrast to the simple biographical questionnaire that claimants now need to complete over the telephone.

 

It is not yet clear whether the DWP plan to revisit ID verification for claimants who pass the telephone questionnaire, whether the DWP will have capacity to address any backlog and how any such action would affect claimants.

1.2   Additional documents or evidence

We understand from the DWP that they will continue to process UC claims without supporting evidence, including tenancy agreements, but they will verify at a later date and have processes in place to identify all cases to which this approach has been applied. It is not clear what impact such action could have on claimants.

1.2.1          Self-employed earnings

The UC claim questions don’t currently ask for details of hours and earnings from self-employed claimants, usually expecting such information to be submitted at a subsequent Jobcentre appointment. It’s unclear how the DWP will retrieve work hours and earnings information from self-employed people claiming UC for the first time, and what expectations there are on the claimant to report any application to, or award from, the Self Employment Income Support Scheme.

 

1.2.2          Work capability assessments

DWP guidance confirms that UC claimants who are self-isolating in accordance with government advice (i.e. when displaying symptoms or living with someone displaying symptoms, or have been advised to self-isolate) will be treated as having limited capability for work for the time they are isolating. Once the isolation period is over, they become subject to the usual work capability assessment process – requiring claimants to complete and return a paper UC50 form, together with relevant medical evidence and participate in a medical assessment.

 

Claimants who need support to complete their forms will be disadvantaged, as advice services are not able to provide the same level of face-to-face advice services. Retrieving medical evidence, often a cumbersome task at the best of times will also be problematic. A lack of medical evidence to corroborate the information provided in the form may prejudice the outcome of the work capability assessment.

 

The outcomes of face-to-face medical assessments are the subject of a significant proportion of challenges and appeals. Now that face-to-face assessments have been suspended in favour of telephone assessments, we are waiting to see if claimants’ satisfaction with the quality of decision-making improves or deteriorates.

 

The Early Warning System continues to receive cases concerning the delay in a work capability assessment being completed. Such a delay means claimants who may be entitled to a work allowance (to offset any earnings if they are found to have limited capability for work) or an additional element (if they are found to have limited capability for work-related activity) remain financially worse off, not receiving the additional income that is required to support them with an illness or disability. It also means claimants may remain subject to conditionality requirements which their health or disability renders impossible for them to comply with, or further endangers their health. It remains to be seen whether telephone assessments will be undertaken more promptly.

 

UC50 submitted in August 2019 but no assessment has yet been arranged for vulnerable client. #B167 20/03/20

1.2.3          Terminal illness

The Early Warning System has received one case illustrating the problems retrieving medical evidence, which is of great concern for those who have been diagnosed with a terminal illness.

 

Couple where one is over pension age with terminal cancer in receipt of AA. He is struggling to retrieve DS1500 from GP in current crisis and cannot therefore be treated as having limited capability for work under special rules. # U896 01/04/20

1.2.4          Immigration status

The Early Warning System has also received a case highlighting how the difficulties retrieving immigration documents prevent any claim from proceeding, leaving families destitute.

 

Couple with one child awaiting ID document from the Home Office which is needed before UC claim may be made. Home Office delays appear to be side effect of pandemic. The family are living in temporary accommodation without bedding or kitchen equipment, currently reliant on foodbank vouchers provided by Social Services.#B179 02/04/20

 

CPAG notes that families who are subject to the Habitual Residence Test will be similarly deprived if, for example, they struggle to retrieve documents from past employers or bank statements to evidence their work history.

1.3   Conditionality

Claimants may be subject to a sanction if they do not comply with the conditionality requirements outlined in the claimant commitment. The requirements may include attendance at jobcentre appointments, work search, work preparation and taking steps to increase earnings.

 

The DWP suspended all Jobcentre appointments for three months from 19th March 2020, and no work search or preparation requirements are applied whilst claimants are treated as having limited capability for work (because they are self-isolating in accordance with government guidance). These are welcome developments to protect claimants from unnecessary interactions in person, and ease requirements for unwell claimants.

 

Regarding claimants who are not self-isolating, the DWP has told Citizens Advice[2] that “Work coaches can continue to use their discretion to agree work preparation activities that can be done from home if this is reasonable. They can continue to conduct work focused interviews over the telephone or have contact via the claimant Journal where this is reasonable.

 

New claimants who do not have limited capability for work (e.g. because they are isolating in accordance with government advice) will not be subject to work search requirements for 3 months from 30th March 2020[3] but may be subject to work preparation requirements. It’s unclear at this stage what will be considered reasonable for claimants who are not working due to:

 

We do not yet know how conditionality requirements are being adjusted to suit such claimants, or whether the DWP has adequate resources to monitor compliance and impose sanctions. Relaxed requirements are welcome at this time to ease the pressure on claimants who are unlikely to be able to comply with the usual stringent requirements.

 

There is some information available on the DWP’s Understanding Universal Credit website[4] about claimant responsibilities but this may not be enough to adequately inform people in the situations outlined above. Evidence in the Early Warning System suggests that some are reluctant to claim due to the conditionality requirements.

 

Disabled student with carer husband and 3 kids are managing on student loan income only. Not "disabled enough" for disability benefits and reluctant to claim UC as wouldn't be able to manage if husband was obliged to seek work. #P471 20/03/2020

 

Mixed age couple where one is over pension age with terminal cancer in receipt of AA, the other is fostering 2 teenagers under a private arrangement. DWP has told claimant she must decide whether to comply with 25 hours work search, give up fostering arrangement or give up UC. #U896 01/04/20

2.       Has there been any improvement in the significant delays that new UC claimants were experiencing in the second half of March?

 

The number of cases in CPAG’s Early Warning System which flag delays in ID verification as a concern has dropped from the end of March. The redeployment of DWP staff to deal with new claims and the reduced requirements for ID verification may account for this, although we note that advisers may not be flagging the issue with CPAG now because the issue was so well-publicised.

 

The DWP’s latest announcement[5] that phone calls are not required to arrange telephone appointments is likely to reduce the strain on their telephone lines. It’s not clear whether this information is being clearly communicated within the claim. Advisers’ entries on Rightsnet[6] indicate that claimants awaiting a call will now receive a note in their online journal informing them, but it’s not clear whether the “To Do” directing the claimant to phone remains outstanding.

 

In the meantime, we continue to receive reports of problems getting through on the phone lines, for example if they need to start a telephone rather than online claim (see above under 1.1.1) or attempt to claim new-style ESA.  

 

Self-employed cleaner with 12 year old unable to work because the sites she cleans are closed. She is now shielding according to official advice. She is one of many self-employed cancer patients whose work hours steadily reduce/ fluctuate in line with treatment and recovery. She can't get through on phone lines to claim new-style ESA without claiming UC (so as to retain her existing working tax credit and housing benefit claims). #A678 02/04/2020

 

It is not possible to claim new-style ESA online without starting a UC claim and terminating legacy benefit claims (see section 5 below).

 

Recommendation: it needs to be made possible to claim ESA and JSA online without having to start a UC claim.

3.       How quickly are people who ask for advance payments of Universal Credit receiving their payments?

 

Advance payments can only be accessed once ID verification has been completed. CPAG’s Early Warning System has not received any reports regarding delays retrieving the advance once it has been requested following the ID verification stage.

 

Recommendation: We strongly believe that advance payments should be made non-repayable for the duration of the pandemic to support people at a time of unprecedented financial crisis and to avoid debt problems further down the line.

4.       What lessons can be learned from the changes that have been made to the processes for verifying the identity of UC claimants? Are there any particular changes that should stay in place after the outbreak ends?

4.1   Online Verify

It appears the online verify process was inadequate for two reasons:

 

Lessons may be learnt about both of these.

4.2   Relaxed verification requirements

The Early Warning System notes that the verification process over the phone is far less stringent than the online Verify service, and the requirements of Jobcentre appointments. Claimants are now asked simple biographical questions.

 

A client received their phone call from the DWP to verify ID. All they asked her was her full name, date of birth, bank details, previous address and postcode. She wasn’t asked for her passport number or driving licence number. #P467 25/03/20

 

Recommendation: If the verification process remains a barrier to accessing entitlement promptly after the outbreak ends, there may be scope for continuing to allow claims to proceed with relaxed requirements and verifying documents at a later date.

4.3   Telephone call task

Claimants are usually required to call the UC helpline to arrange an appointment. The appointment is required:

 

The DWP’s announcement that claimants no longer need to call them, and that if necessary, the DWP will contact them, is welcome at a time when it is impossible to get through to staff quickly.  It is unclear how promptly the DWP is making these calls to claimants, and whether claimants are available at the time the call is made. Some insight into how promptly calls are made, and which if any claimants are not picking up the calls would be of use in deciding the usefulness of this measure following the end of the outbreak.

 

An online option for selecting a preferred time for the call from the DWP could ensure claimants don’t miss the call, particularly if a link could be provided for creating an appointment or alert in their own calendar.

4.4   Telephone system

It must be acknowledged that the DWP has made tremendous efforts to process all new claims with the redeployment of staff. However, it may be worth assessing the efficacy of the telephony system as the Early Warning System has heard that callers are still waiting indefinitely on the line (they are not told how long they can expect to wait) and also being inexplicably cut off.

 

A client has been trying to get through on the UC helpline without success. After 45 minutes waiting, she is cut off. #P472 20/03/20

4.5   Jobcentre appointments

Recommendation: The DWP’s efforts to deal with matters over the phone, where possible, are a sensible step at this time. It is hoped that the DWP will consider whether telephone appointments may be a suitable alternative to Jobcentre appointments after the outbreak has ended.

 

This would remove a barrier to claiming for those who struggle to make and attend appointments e.g. due to poor physical or mental health, caring or childcare responsibilities and work hours.

5.       How do the needs of people claiming UC for the first time now differ from the needs of groups who’ve claimed UC in the past? How well is Universal Credit working for these new groups of people?

 

The Early Warning System has noted a shift in the demographics of the cases received over past weeks. See below chart illustrating the numbers of the most common flags in the four weeks up to 07/04/2020.

 

 

There has been a considerable increase in cases concerning people who are working or self-employed. More specifically, we’re hearing about people who had low paid and/or insecure work before the outbreak such as:

 

This appears to tally with the surge of UC claims triggered by loss of work due to the outbreak.  We’ve also seen a spike in cases concerning home owners (people who had a stable income when they took out their mortgage). Especially as they will not receive any help with mortgage interest payments for 9 months.

5.1   Confusion regarding entitlement

There is more than one income-replacement scheme in place for employed and self-employed people who have had to stop working due to the outbreak:

 

The Early Warning System cases indicate that people are not always clear on the rules for each scheme or how they interact with each other.

 

Single parent of four children who worked in schools under agency contract is no longer receiving work. She has no symptoms and is not shielding. Not clear whether employer willing to pay furlough for zero hours contract worker. Worried about existing benefits stopping and disruption of UC claim now (five week wait, uncertainty as to amount and conditionality). #B183 02/04/20

 

A furloughed worker doesn’t know if he can claim UC whilst he is waiting for a payment under the employee retention scheme. The five week wait in UC is probably longer than wait for furlough pay, but no income in the meantime means he needs the advance. #U900 02/04/20

 

A mum of three was made redundant due to the outbreak and she is expecting her working tax credit (WTC) to stop. She doesn’t know whether she should claim UC or reclaim WTC when she starts working again. #A685 18/03/20

 

Self-employed cleaner with 12 year old is unable to work because sites she cleans are closed. She is now shielding according to official advice. She is one of many self-employed cancer patients whose work hours steadily reduce/ fluctuate in line with treatment and recovery. She doesn't know what to claim to replace her lost income and is concerned about her tax credits and housing benefit (HB) stopping. Her private landlord is not sympathetic and current benefit income leaves £400pm shortfall. She hasn’t been able to get through on phone lines to claim new- style ESA (without starting a UC claim). #A678 02/04/20

 

Although there are numerous separate resources available online explaining each scheme, there is clearly a need for advice at an early stage to ensure people are selecting the right option for them and do not become worse off.

 

Recommendation: The UC system needs to be able to flag the need for advice, and advice providers (usually charities) require the resources to meet the demand.

5.2   Not enough to make ends meet

The standard allowance in UC has been increased, as well as the rate of local housing allowance, but this may not be enough to see people through the crisis.

5.2.1          Benefit cap

The recent increase in elements will mean the benefit cap, which limits the total amount of UC (and child benefit) payable in a claim, will reduce entitlement for far more families and in many more local authority areas (as reported by the Resolution Foundation[7]). Our own estimates suggest that 12,500 more families will now be affected by the benefit cap due to the standard allowance uprating, and many more due to the increase in Local Housing Allowance. We can also expect some 10,000 additional families to be subject to the cap due to job loss or furlough pay bringing their earnings below the threshold for exemption. The Early Warning System is already receiving cases about people who will be affected.

 

A single person is still not able to make ends meet with increased standard allowance and local housing allowance because his entitlement is reduced by the benefit cap. #P473 02/04/20

 

Term-time worker on furlough will become subject to benefit cap when UC standard allowance increases, meaning she doesn't benefit by the amount the government deem is necessary throughout this crisis. #P485 08/04/20

 

Recommendation: the rationale for the benefit cap no longer applies and it should be removed.

5.2.2          Two Child Limit

In CPAG’s legal challenge to the Two Child Limit (which you can read about on the Two Child Limit Challenge test case page of the CPAG website[8]) the DWP outlined the principal policy justification for the limit as “ensur[ing] that the benefits system is fair to those who pay for it, as well as those who benefit from it, ensuring those on benefits face the same financial choices around the number of children they can afford as those supporting themselves through work.”

 

Clearly, many of those with more than two children who were previously able to support themselves through work are now unable to do so. Maintaining the two child limit at this time will force many more children into poverty, at a time when their parents have no power to support themselves through work.

 

Recommendation: the rationale for the 2-child policy no longer applies and it should be removed.

5.3   Home owners

In the past month, the Early Warning System has logged numerous cases from home owners.

 

Client’s work contract expired and wasn’t renewed due to the outbreak. She needs help paying for her mortgage. #A673 27/03/20

 

Home owners may benefit from a three month mortgage holiday (which would increase overall debt and long term repayment levels), but only if they’re up-to-date on their mortgage payments. Any families who were already in arrears before the outbreak may find themselves in an even more precarious situation. Support for mortgage interest is available in a UC claim, but only after nine months of receiving UC. If their income exceeds their entitlement at any point during that nine month period, the waiting time starts again. More comprehensive support is required to keep these families in their homes in the long-term.

 

Recommendation: mortgage interest payments should be covered from day one as they used to be

5.4   Bereavement

With the high rate of coronavirus deaths across the country, it is likely that we will see an increase in the number of bereaved people starting a UC claim for the first time.

 

UC can only be backdated in limited circumstances, for a maximum of one month. Bereavement is not currently listed as a reason to permit a backdated award. People who need to claim UC after a death in the family will need to do so immediately to ensure they don’t lose out on entitlement.

 

People who move onto UC because legacy benefits have stopped due a death will not benefit from the bereavement protection available to people who were claiming UC before the death. Bereavement protection keeps benefit payments at the same rate for up to three months following the death. This appears to be an oversight in the regulations which CPAG has been hearing about since before the outbreak, and which is set to affect more people.

 

A bereaved client’s benefits stopped immediately on the death of her husband. She didn’t start claiming UC for many months. UC could not be backdated and she didn’t receive any bereavement protection. Her grief was severely exacerbated by all of this. #P464 10/03/20

 

A bereaved partner was the lead claimant in the legacy claims so had bereavement protection in ESA and HB, plus carer’s allowance run-on. However, the joint child tax credit claim stopped and she will have to claim UC. She won’t benefit from any bereavement protection in UC. #U861 10/03/20

 

Recommendation: extend bereavement protection to new claimants after a death

6.       Are there any indications of how well the UC system will work for these claimants as they move into work in the short- to medium-term?

6.1   Conditionality

People who were previously employed by agencies and/or with zero hours contracts may find that shifts are not fully reinstated straight away after the outbreak. They may find themselves subject to in-work conditionality, obliging them to make attempts to increase their hours and/or earnings or risk a sanction. Aside from the unfairness of expecting workers to overcome the prevailing economic conditions (over which they have no control), in-work conditionality has been shown to be effective only when intensive support is provided. (See DWP’s UC in work progression randomised controlled trial results from September 2018[9]).

 

Job seeking and working claimants who cannot comply with conditionality requirements may find themselves subject to a sanction. The previous Work and Pension committee found such sanctions to be counter-productive (in their Benefit Sanctions Report dated October 2019[10]). The government rejected the committee’s forceful recommendations at that time, summarised on the Parliament website.[11]

 

Recommendation: Now that there are so many UC claimants who may be subject to full conditionality or placed in the “all work-related requirements” group, it is imperative that the conditionality and sanctions regime is ether reassessed by government or that amending DWP guidance is released confirming that any requirements will take into account the prevailing conditions in the labour market.

6.2   Monthly assessment periods

The multitude of problems that arise from the strictly applied monthly assessment period in UC were outlined in CPAG’s Rough Justice report in August 2018.[12]

 

The Early Warning System has continued to receive cases about how UC awards fluctuate greatly even when earnings are stable, because the monthly assessment period is arbitrarily applied to earnings that are received more frequently than monthly. CPAG continues to challenge the failure of the DWP to apportion earnings[13] (which results in perverse outcomes when for example a claimant who is normally paid monthly receives one pay packet early around Christmas and sees their award reduced by twice as much in one month, and then lose the work allowance and become benefit capped in the following month).

 

Recommendation: Implement ruling made by the High Court in Johnson et al v Secretary of State for Work and Pensions[14]

 

As people move into work in the short or medium term, they may be surprised by fluctuations in their UC award, even when their earnings remain stable. These fluctuations may destabilise families’ finances, particularly as they may already be in a precarious situation following a period without work. For example:

 

A full-time nurse is paid monthly on the last Wednesday of the month. Her UC amounts fluctuate greatly. She loses the work allowance more than once a year. She has even been called in for a Jobcentre appointment to review her claimant commitment because the system flagged that she wasn’t working one month. She could also be subject to benefit cap. Double pay in some assessment periods mean her council tax support has stopped as well. Fluctuations in monthly income make it impossible to budget effectively. The difference between months has been as much as £1,100:

 

Assessment period

No. pay packets counted

Total pay

UC amount

Total income

29/05/19-28/06/19

2

2,134.40

£441.27

£2,575.67

29/06/19-28/07/19

0

£0.00

£1,605.13

£1,605.13

29/07/19-28/08/19

2

£2,240.66

£251.44

£2,492.10

29/08/19-28/09/19

1

£1,046.59

£1,003.72

£2,050.31

29/09/19-28/10/19

0

£0.00

£1,511.92

£1,511.92

29/10/19-28/11/19

2

£2,443.63

£248.58

£2,692.21

#P445 28/01/20

 

Couple with five children are both working casual hours and paid weekly. UC entitlement fluctuates and benefit cap applied even when requisite hours worked due to weekly pay. #P448 07/02/20

 

All benefits are paid in arrears. However, the longer assessment period in UC (compared with weekly or fortnightly in legacy benefits) requires claimants to incur a whole month’s worth of expenses before they are ‘reimbursed’ by their UC payment. The UC advance is not a solution to this problem, as it only temporarily relieves the pressure and if anything, further entrenches the claimant in hardship. See Trussell Trust’s 5 weeks too long report from September 2019.

 

UC claimant families are missing out on food and necessities such as nappies and baby milk because they have to wait for their monthly UC payment to come in. One family is staying home according to medical advice but can't get a shopping delivery date because by the time they receive their money; all the slots are booked for weeks ahead. #P468 25/03/20

 

Recommendation: end the 5-week wait by making advance payments non-repayable.

6.3   Reinstatement of suspended rules

It is likely that the allowances that have been made in recent weeks will be rescinded after the outbreak ends. Claimants who started claiming UC during the outbreak may have difficulties adjusting to the changes.

6.3.1          Jobcentre appointments

Jobcentre appointments are currently suspended for the majority of claimants but may be reinstated when the outbreak ends. Claimants who miss Jobcentre appointments can be referred for a sanction. People who are unused to claiming UC or who are preoccupied with other responsibilities may miss appointments without realising that they could lose a substantial proportion of their UC award.

6.3.2          Minimum income floor and surplus earnings

The minimum income floor (MIF) has been suspended for all self-employed for the duration of the outbreak. The MIF, which assumes a minimum level of income for self-employed, is particularly detrimental to self-employed claimants who:

 

A twelve month grace period is available for newly self-employed people allowing their actual earnings to be taken into account initially.  The grace period is due to be extended in September 2020 to cover the first twelve months of new UC claims for all self-employed people. This may be too late for many self-employed people who start their UC claims in the intervening months.

 

A self-employed gardener only works one day per week because his health is poor. He is reluctant to give up work but he is subject to a MIF which assumes he earns £300 per week when he only receives £55 per week. He remains subject to the MIF until such time as a decision is made that he has limited capability for work. #U885 06/03/20

 

Self-employed claimant (with learning disability and mental health issues) with erratic hours/work had MIF applied to him and accrued rent arrears as a result. He stopped working as per benefits advice in order to be paid UC. #B162 13/03/20

 

Recommendation: implement the 12-month grace period immediately

6.3.3          Reinstatement of debt deductions

The DWP has recently suspended recovery of some, but not all, debts from UC awards. Benefit and tax credit overpayments are not currently being recovered, although UC advance repayments and other deductions continue.

 

The rules in UC for debt deductions are much more detrimental to claimants than those in legacy benefits – with higher deduction rates, more deductions permitted and less guidance permitting use of discretion to freeze recovery, reduce recovery rates or write off DWP debts. The complexity of the rules also means claimants can’t be sure that the rules governing debt deductions are being followed, and the system does not appear to be set up to facilitate claimants to discuss their deductions with the DWP (not clear whether UC or debt management appropriate, or who actually has power to amend the settings in the claim).

 

A client with three young children is receiving £0 UC each month (after housing costs paid direct to landlord) due to high level of deductions. £2,733.07 entitlement reduced by £1024.83 benefit cap, £53.43 budgeting advance repayment, £31.78 rent arrears deduction at 10%, £41.91 tax credit overpayment. £1581.12 is paid directly to the landlord for rent. Cannot escape benefit cap because youngest child is three, so can't work enough to earn £520pcm. #P354

7.       How well is the benefits system working for self-employed people who aren’t able to access the Government’s Self-employment Income Support Scheme? Is there a case for temporarily suspending the capital limits in UC during this period? 

7.1   Universal Credit

The Early Warning System is yet to receive cases illustrating how well UC is working for self-employed claimants during the outbreak. An increase in submissions from this group is anticipated once they start to receive their first UC payment. See above at 1.2.3 regarding the documents that self-employed claimants will need to submit to support their claim.

7.2   Capital

Self-employed claimants who have capital or savings can continue to receive Tax Credits but would be subject to capital limits and income rules in UC. The DWP has confirmed that savings that have been set aside in a business account to meet tax or VAT obligations may be disregarded, but many businesses will have other assets. There is a clear disparity between self-employed claimants who already had a Tax Credits claim and those who are starting a UC claim.

 

Recommendation: capital rules in UC should be removed or at least suspended for one year.

8.       How effective have DWP’s communications with the public been during this period? 

 

The DWP has regularly and quickly provided new information online in response to the evolving announcements. Initially this information was not all provided in one place which made it difficult for claimants and advisers to navigate and led to some confusion. However it appears that considerable work has gone into putting all the information in a central place online in recent days.

 

There are some areas where further clarity would be helpful, for example around the impact of the Self Employed Income Support Scheme on UC.  The information online states that it will be treated as earnings but it is not clear the period the first payment will be attributable to.

 

There is a mismatch between guidance and regulations which is leading to a lack of clarity for claimants and advisers. For example, government guidance[15] suggests anyone who cannot work because they a) have symptoms b) are living with someone with symptoms c) need to shield themselves should get statutory sick pay (SSP). Until yesterday, this was not supported by regulations which only covered scenarios a) and b).

9.       How easy is it for people to understand what they’re entitled to claim? For example:

         Is it clear enough how the benefits system interacts with other forms of Government support during this period, such as the Coronavirus Job Retention Scheme?

Queries to CPAG’s second tier advice line would suggest that there is a need for more clarity about how the Government support interacts with the benefit system.

 

Queries in relation to the Job Retention scheme and the Self Employed Income Support Scheme (SEISS) include:

Some self-employed people and employers appear to be under the misapprehension that claiming benefits just now will jeopardise applications to the government support scheme. 

 

Self-employed client, his partner and child’s only income is child benefit. He has been advised to claim UC and council tax reduction but he has heard that if he claims benefits he will not be entitled to SEISS

 

Recommendation: make it clear in government communications that a claim to UC will not exclude you from getting SEISS, although the income will be taken into account in any UC claim.

         Is it clear enough how public health guidance interacts with the benefits system?

Early Warning System case studies highlight that there was confusion in understanding the difference between self-isolating because you or someone in the household has Covid 19 or symptoms and shielding because you have an underlying health condition. That then had a corresponding effect on understanding benefit entitlement for the two different situations. Regulations brought into force today (16th April 2020) address this, making people who are shielding eligible for SSP.[16]

 

An agency worker with diabetes is shielding. It is unlikely that he could claim ESA or SSP as he is not self-isolating. There is no work for him and he has not been furloughed, his only option appears to be to claim UC. #294 (02/04/20)

 

Recommendation: regulations need to be changed so shielding counts as a condition that entitles you to claim SSP or ESA.

10.   How is the assessment process for Employment Support Allowance working? Have there been any difficulties with obtaining medical evidence to support claims?

10.1                        Work Capability Assessments

The Work Capability Assessment process applies in UC (for those who may have limited capability for work) as well as new-style ESA claims.

 

The suspension of face-to-face assessments in favour of telephone assessments has been discussed above at section 1.2.3. The Early Warning System is yet to retrieve evidence of how well this process is working. Those who are automatically treated as having limited capability for work because they need to self-isolate are not subject to the work capability assessment process. New claimants who may have limited capability for work for another reason may not be assessed for up to three months following the start of their claim.

 

The difficulties retrieving medical evidence faced by many claimants have been exacerbated in recent times. At 1.2.4 above, an example is provided of a claimant struggling to retrieve a DS1500 from their doctor to evidence their terminal illness. The DS1500 is a straightforward form to complete, so it is reasonable to assume that requests for medical records or a detailed letter will be equally problematic.

 

The Early Warning System has previously received numerous cases about posted documents going astray at the DWP and significant delays in them reaching the appropriate staff member. Claimants are apparently unable to avoid these problems by submitting medical evidence online.

 

A client who challenged a work capability decision in his online UC journal retrieved medical evidence to accompany it. His adviser requested an upload link which would permit submission of the evidence in the journal. The request was refused, obliging the client to send the documents by post. The bureaucracy of the process has greatly impacted an unwell man who gave up work very reluctantly due to his health. 08/04/20

 

Recommendation: make it possible to scan or submit medical evidence online

10.2                        Claiming ESA without UC

People are struggling to claim ESA without starting a claim for UC. Both may be claimed together online but to claim ESA alone, claimants must telephone and contend with staff who insist that both benefits must be claimed together. This has been a persistent problem since the introduction of UC full service that does not appear to have improved in recent weeks.

 

Self-employed husband and father of two children is a minicab driver. He has made National Insurance contributions for at least the last 8 years. He has stopped work because he has a health condition that makes him vulnerable and his GP advised him to self-isolate. He receives tax credits and some HB. He tried to claim new-style ESA but was told that he should make a UC claim. He is reluctant to claim UC and have his legacy benefits stopped. #B182 02/04/20

 

Recommendation: rather than suspending hearings, these should be held online via Skype or Zoom.

11.   What impact has the outbreak had on people who were waiting for a Mandatory Reconsideration of a decision, or who were going through the appeals process?

 

Delays in the completion of mandatory reconsiderations were an ongoing concern before the outbreak. We are concerned that the redeployment of thousands of staff may affect the mandatory reconsideration process, causing delays for people challenging decisions.

 

Appeals against decisions concerning limited capability for work or disability benefits tend to be more successful when the appellant attends a hearing in person. Advisers are raising concerns that the recent measures permitting more appeals to be decided on the papers may prejudice the appellants.

12.   Have people who were already claiming benefits when the outbreak began seen any changes to the support they receive from DWP?

 

We were hearing of issues of PIP assessments being delayed prior to the outbreak of the pandemic. One agency reported that several clients had applied for PIP earlier this year, but have not heard anything.

 

One client's PIP award ended the day before it was announced that PIP awards would be extended due to PIP assessments not being carried out. The client had completed a renewal form and it was received by DWP in January - it just hasn't been processed yet. #308 (6/4/20)

 

Client's PIP award is due to end on 20th April. Her face to face assessment was cancelled and she is waiting to be contacted about a phone assessment. PIP told her that it was unlikely that a decision would be made before her award runs out and that her PIP and associated benefits would stop, but be backdated once the decision is made. This seems to be at odds with the secretary of state's announcement that PIP awards would be extended. Client's husband also receives PIP and has an underlying entitlement to carer's allowance, so they receive the couple severe disability premium (SDP) and the carer's premium in their old-style ESA. Her PIP stopping would be financially catastrophic for them #351 (8/4/20)

 

It would be beneficial if decisions extending all PIP/DLA/AA/IIDB awards due to end could be notified in writing otherwise individual claimants are left in the position of contacting DWP themselves to enquire what is happening to their award causing stress and uncertainty and additional pressure on DWP phone lines. We’ve also heard that the redeployment of DWP staff is affecting certain teams. For example, the SDP team had assured some claimants who had been permitted to claim UC in error that they would be returned to legacy benefits. Now that staff has been redeployed those claimants remain worse off on UC with no certainty as to whether or when their situations will be resolved.

 

Recommendation: Notify claimants in writing to confirm whether they can expect their awards to continue past the expiry date

13.   Are people who are claiming benefits receiving enough money to cover their basic living costs during this period?

 

Case studies received by the Early Warning System highlight that people claiming benefits are struggling to cope financially during the pandemic due to increased costs. We anticipate a rise in these cases once UC payments start to be received.

 

UC claimant with moderate income explains how her family is affected, previously just about making ends meet (but no treats) and now increased costs everywhere: additional commuting costs for childcare arrangements now children off school, increased food budget for kids who empty fridge every day, increased energy and water bills, higher prices in supermarket across the board, visiting numerous shops to do a standard (non-stock-piling) shop. Everyone wants food parcels whether they "need" one or not. She also runs advice service and concerned that funding will not continue. #P469 25/03/20

 

Separated parents have a 50/50 arrangement for the care of their children. Mother claims child benefit and he claims child tax credits because he had the lower income. Her work has stopped due to the pandemic. She’s worried that she won’t be entitled to any amounts for the children, even though she bears at least half the cost. #B185 07/04/20

 

Difficulties making ends meet on UC are aggravated by the benefit cap, the two child limit (see 5.2 above) and the lack of bereavement protection for new claimants.

 

Recommendation:  the extra costs facing families have been ignored in the emergency measures – Child Benefit should be increased by £10 per child.

 

Legacy benefit claims stopped on the date of a husband’s death. His bereaved wife had no choice but to claim UC. She was immediately financially disadvantaged and rent arrears started to build. Her UC did not include a carer’s element to reflect the carer’s allowance run-on. Her UC claim could not be backdated to cover the four days it took her to claim after the death of her husband. There is no bereavement protection for new UC claimants so her housing costs are immediately reduced by the bedroom tax. She took a UC advance to catch up with the rent but recovery reduces her ongoing payments. After repayment of her UC advance and paying her rent, she is left with £43.20 per week to live on. #P462 11/03/20

14.   Are there groups of people who need support but aren’t able to access it through the benefits system? What should DWP be doing to support those people?

14.1                        Students

Students who do not have children or disabilities are not entitled to UC. They often rely on earnings from casual type work to top up their student income. The nature of this work means that they are not being furloughed so have no replacement income, but no entitlement to benefits either.

 

Student lost her job due to coronavirus. Her student loans only cover rent, council tax and bills and she has no money left to cover food etc. As a student with no disabilities or children, she is not entitled to UC. Her only options would be to apply for discretionary funds from her college or a crisis grant. #115 (24/3/20)

 

Extra discretionary funds have been made available to students in Scotland[17] but there doesn’t appear to be any extra support available in the rest of the UK.

 

Recommendation: make funds available across the UK to support students who have lost work

 

14.2                        Some EU nationals

EU nationals require a right to reside to be eligible to claim means-tested benefits. The majority of EU nationals acquire a right to reside through work, which is less possible just now.

 

An EU national with three children moved to Scotland in January and is not working. Her partner remained in Europe and isn't working either. Client has been relying on foodbanks and the Scottish Welfare Fund as she is not entitled to claim any benefits. Normally she would have been advised to find work so that she could establish a right to reside as a worker, but that is not possible at the moment. #309 (6/4/20)

 

EU national and partner have been in the UK for less than five years and have a patchy work history He was in his current job for less than a month when he had to stop working as he has an underlying health condition. The couple are currently relying on foodbanks and have been refused a Scottish Welfare Fund crisis grant. #326 (7/4/20)

 

Recommendation: Review UC right to reside requirements (with reference to relevant EU rules)

14.3                        People with no recourse to public funds

The Early Warning System has received case studies highlighting that people with no recourse to public funds (NRTPF) are unable to claim any support during this time.

 

Client who was here working wants to return home to Canada as she is terminally ill, but cannot just now. She is not eligible to claim any benefits, including the Scottish Welfare Fund as it is public funds. Her flat mate is trying to support her financially but cannot afford to do this long term. #303 (6/4/20)

 

Client and his wife are full time students with visas that state they have NRTPF. Their course has been suspended. It is unlikely they can claim any means tested benefits and would be advised to seek immigration advice first. #166 (26/3/20)

 

Recommendation: make funds available to provide emergency support to those with NRTPF

14.4                        People who are stuck in the UK or abroad

UC entitlement is reliant on you being present and habitually resident in the UK. The Early Warning System has received a couple of examples of people who are either stuck in the UK or abroad not having access to any benefits to support them.

 

A Scottish national was working in Spain but is not receiving any wages due to coronavirus. She is not entitled to Spanish benefits and neither can she claim UC as she is not present and habitually resident in the UK #114 (24/03/20)

 

Scottish client lives abroad but returned to the UK for a holiday. He cannot return to his home abroad due to the travel ban, but is unlikely to satisfy the habitual residence test in order to be able to claim UC. #143 (25/3/20)

14.5                        People whose partners have an income

Self-employed taxi driver whose income has dried up will not be entitled to UC due to his wife's income. It's unlikely that he would have made the NI contributions that would entitle him to contributions-based JSA and he would only be entitled to contributory ESA if he is self-isolating. The household’s income has dropped dramatically but he will have to wait for government support for self-employed people #154 (26/3/20)

14.6                        People with savings

People with savings of more than £16,000 are not entitled to UC. Savings of more than £6,000 will be assessed as providing some income.

 

A couple currently receive tax credits but a better off calculation shows that they would be better off claiming UC once the Mum is furloughed. However they have £17K savings in their bank account from their child's DLA which they have been saving as he will need life-long care. #335 (7/4/20)

 

Recommendation: remove the capital limit in UC

14.7                        Self-employed directors

CPAG has been hearing that some people who have incorporated their businesses and pay themselves as an employed sole director are unable to access any support at all. Their business counts as an asset affecting their eligibility for UC. They cannot furlough themselves because they need to keep working, at least minimally, to keep their business running. If they don’t pay business rates for premises (e.g. their business is based at home) they cannot access the Small Business Grant Fund either. Closing their business or selling it (or any other property owned) is not an option at this time.

 

Businesses such as tourist boats don’t start the season until Easter, which then carries through until September. They are not VAT registered nor do they have business premises. Nonetheless, they must continue to pay mooring fees, insurance, loan charges which have to be paid for the whole year. #P484 08/04/20

15.   Are support organisations and charities able to access the resources they need from DWP to support vulnerable people? What more could DWP be doing to facilitate that support?

15.1                        Consent or authority

Advisers have previously encountered difficulties acting on behalf their clients in UC claims. The DWP often insisted that clients had to be present before a claim could be discussed, or required advisers who had been given explicit consent in the online journal to answer the claimant’s own security questions. Recent reports suggest that in some instances, these requirements have been relaxed. It’s not clear whether the DWP has officially changed their policy and clarification would assist advisers to support their clients, including very vulnerable claimants, at this time.

 

Recommendation: implement implicit consent policy in UC

15.2                        Completing forms

Advisers who would usually help their clients to complete PIP2, ESA50 and UC50 forms in face-to-face appointments are looking for ways to continue supporting their clients whilst working from home.

 

Client has a PIP2 that should be sent back this week. Client doesn't speak English and lives alone. Adviser doesn’t have authority to act on his behalf. Adviser would usually arrange an appointment and sit with the client and complete the form, but obviously can't do that now #173 (26/3/20)

 

A blank version of the ESA50 is available online so advisers can see and complete the form whilst on the telephone to their client. Providing the UC50 and PIP2 forms online would enable advisers to do the same for those forms.

 

It’s not clear whether forms will be accepted without the claimant’s signature. Where they have accessed remote support to complete the form and return of the form is time sensitive, clients may find this requirement an unnecessary inconvenience and delay. If forms could be submitted without a signature, the subsequent telephone medical assessment appointment may be sufficient to corroborate the contents of the form.

 

Recommendation: Permitting submission of completed forms online or by email would be a welcome step. The claimants completing these forms are disabled or unwell; buying envelopes and posting the forms is a risk they cannot afford to take. Online submission of the forms could also facilitate advisers to support clients remotely.

16.   Recommendations

16.1 Recommended legislative changes

 

16.2 Policy clarification

 

16.3 Recommended process changes

 

 

April 2020

 

 

 

 


[1] CPAG’s Early Warning System: Top Issues Update April 2019 report available at https://cpag.org.uk/policy-and-campaigns/report/early-warning-system-top-issues-update-april-2019

 

[2] https://www.rightsnet.org.uk/forums/viewthread/15714 23/03/20

[3] Regulation 6 of the Social Security (Coronavirus) (Further Measures) Regulations 2020, SI 2020 No.371

[4] https://www.understandinguniversalcredit.gov.uk/new-to-universal-credit/your-responsibilities/

[5] https://www.gov.uk/government/news/don-t-call-us-we-ll-call-you

[6] https://www.rightsnet.org.uk/forums/viewthread/15825

[7] https://www.resolutionfoundation.org/comment/exiting-the-economic-shock/

[8] https://cpag.org.uk/welfare-rights/legal-test-cases/two-child-limit-challenge

[9] https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/739766/summary-universal-credit-in-work-progression-randomised-controlled-trial.pdf

[10] https://publications.parliament.uk/pa/cm201719/cmselect/cmworpen/955/955.pdf

[11] https://www.parliament.uk/business/committees/committees-a-z/commons-select/work-and-pensions-committee/news-parliament-2017/benefit-sanctions-government-response-report-publication-17-19/

[12] https://cpag.org.uk/policy-and-campaigns/report/rough-justice-problems-monthly-assessment-pay-and-circumstances

[13] https://cpag.org.uk/welfare-rights/legal-test-cases/universal-credit-assessment-period-inflexibility

https://cpag.org.uk/welfare-rights/legal-test-cases/current-test-cases/benefit-cap-and-those-paid-4-weekly

[14] [2019] EWHC 23 (Admin) https://www.bailii.org/ew/cases/EWHC/Admin/2019/23.html

[15] https://www.gov.uk/government/publications/support-for-those-affected-by-covid-19/support-for-those-affected-by-covid-19

[16] The Statutory Sick Pay (General) (Coronavirus Amendment) (No. 3) Regulations 2020 http://www.legislation.gov.uk/uksi/2020/427/made

 

[17] www.gov.scot/news/extra-hardship-payments-for-students/