EDITORIAL: New benefits system needs to take account of most vulnerable

(31 March, 2016)

A new benefits system will be trialled on SE1 residents

948A banner put up by the Southwark Revolutionary Communist Group at a protest last year.

It triggered a crisis in central Government and the resignation of the minister who was overseeing its implementation, and now the Universal Credit system is to be tried out in a pilot for SE1 residents, before being unrolled across the capital and country.

Charity Citizens’ Advice warned this week that it expected 697 Southwark residents could need help or face falling into financial trouble with the new system – almost three times the number of people in Lambeth and five times the number in Lewisham. With new claimants having to wait six weeks for their first monthly payment, unless they have savings, they could struggle to pay bills. And if you’re on benefits in the first place, it stands to reason that you aren’t awash with savings.

The idea of switching from fortnightly to monthly payments is to make them feel ‘more like a wage’ and to teach recipients to budget and plan for their rent, and there is some logic to receiving a monthly payment like a salary. However, isn’t it a risk to remove direct payments for housing benefit and the like, and just rely on the recipient being able to budget?

The new system will also require claimants to own bank accounts, which will impact on elderly recipients who may only have Post Office accounts, as well as those without a fixed address, including homeless people.

The Department of Work and Pensions says people will earn more under the new system and move faster into work – but if the most vulnerable aren’t protected, implementing this controversial new system could lead to rent arrears and benefits chaos.

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