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The ARCH annual report for 2015-16 is now available to view.

 

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Universal Credit or Universal Debt? 19/01/2017

Universal Credit was introduced as the central plank of a wide ranging series of Welfare Reforms. This system was introduced by the 2010 Coalition Government, to make work pay and to encourage benefit claimants into full time work. Universal Credit combines the following benefits and tax credits: Jobseeker's Allowance, Employment and Support Allowance, Income Support, Child Tax Credit, Working Tax Credit and Housing Benefit into one single monthly payment. Universal Credit has been rolled out gradually but by May 2016 it had been rolled out nationally to all Jobcentre Plus offices for single claimants, and is continuing to be expanded to include all claimant types via the full service.

 

Since its introduction in April 2013 ARCH and the NFA (National Federation of Almos) have been monitoring the impact of Universal Credit on levels of rent arrears of households living in council owned homes.  Our latest analysis reports information as at 30 September 2016, and is the most recent report in the ongoing research being undertaken jointly by ARCH and the NFA.  Further data will be captured from member local authorities and ALMOs at the end of March 2017 and will be used to inform the ongoing dialogue with government departments.

 

The latest research report published jointly on 16 January 2017 by ARCH and the NFA charts the impact of Universal Credit on the rent arrears of households living in council owned homes. More than two and a half years on since its introduction  Universal Credit continues to have a devastating impact on those households and their ability to maintain rent payments and problems experienced by Universal Credit claimants have not subsided but have in fact dramatically worsened.

 

The following infographic highlights the main findings of our report:

 

ARCH NFA Universal Credit Jan 2017 infographic

 

A snapshot of Universal Credit claimants at 30 September 2016 reveal:

 

  • 86% of universal credit claimants living in council owned homes are in rent arrears (compared to 79% at March 2016

 

  • 59% of universal credit claimants living in council owned homes have arrears that equate to more than one month's rent

 

  • Although 63% of UC tenants in arrears had pre-existing arrears before their UC claim only 44% of them are on APAs (alternative payment arrangements with direct payment from DWP)

 

  • The average value of arrears tenants owed across UC households has almost doubled to £615 since 31 March 2016 when average amount was £321. 

 

The report highlights some major concerns for tenants and council landlords which, unless addressed, will cause major problems as Universal Credit is rolled out across the country,  John Bibby, ARCH CEO comments:

 

'We are extremely concerned with the upward trajectory of rent arrears for universal credit households. Not only are numbers of households increasing as UC is rolled out, but the percentage of households falling into rent arrears and experiencing financial difficulty is critically high. If this trend is not reversed it will have significant impact on local authorities' rental income streams and the long term ability for housing departments to provide essential services to their communities. Together with the NFA we continue to hold regular conversation with the DWP to find ways to resolve the problems currently being experienced by claimants.'

 

The Report and its findings has been submitted to the Department of Works & Pensions and in ongoing talks with Caroline Nokes MP (Department of Works & Pensions successor to Lord Freud responsible for overseeing the implementation of Universal Credit) ARCH and the NFA will continue to lobby for an end to the seven day waiting period for Universal Credit claims. 

 

Click here for a full copy of the ARCH/NFA Report "Universal Credit - Progress Report" published on 16 January 2017

 

Publication of the Report has attracted significant media interest and has featured in Inside Housing and other publications including the Local Government Chronicle and 24Housing 

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