The Department for Work and Pensions (DWP) has taken over a month to claim it’s sorted out a basic flaw in Universal Credit. But the damage from its negligence may have already happened. Because 1.4 million people who’ve already applied for the benefit could have had their money delayed. And what’s worse, when you look at the detail – the DWP has barely sorted it at all.
DWP: social distancing?
The Canary first reported on the DWP’s chaotic approach to new Universal Credit claims on 20 March. The department had previously said that new claimants wouldn’t have to go to the jobcentre. But this wasn’t strictly true. Because as part of the application process for Universal Credit, claimants had to prove their identity online. But if they couldn’t do this, then they physically had to go into a jobcentre.
When explaining how to claim Universal Credit, the DWP said:
Acceptable verification includes a passport, driving licence, and/or credit and debit card.
But here’s where the chaos began. Because if you didn’t have the right ID, you couldn’t complete your Universal Credit application online. As the DWP again noted:
If you cannot verify your identity online… You can take 3 forms of proof of identity to your first interview at your local Jobcentre Plus.
So, what the DWP said was that if people infected with, or affected by, coronavirus could not prove their ID online, they’d have to go to a jobcentre to complete their claim. This was completely at odds with the government’s line of “social distancing”.
But now, it appears the DWP has woken up to this major flaw and attempted to fix it.
People applying for Universal Credit will now be able to use their existing Government Gateway account to confirm their identity, helping to speed up their claim.
The move is expected to help thousands of claimants applying for the benefit and will be available to those who have used the Government Gateway in the last 12 months to access their Personal Tax Accounts, including to check their tax credits, send a personal tax return, or check their state pension.
If you have a Government Gateway account, it means that you’ve already verified your ID with HMRC. But as Public Technology noted, the DWP’s move to let people use this service is not without problems.
Government Gateway was decommissioned four years ago. And HMRC closed it to new users two years ago. Plus, new Universal Credit claimants can only use it if they’ve accessed the service in the past 12 months. So, it leaves the DWP’s new policy only available to some new claimants: specifically those who are self-employed, who have been claiming tax credits, or check their state pension online.
The government has not released much data on who the new 1.4 million Universal Credit claimants are. But some of them may be newly self-employed in the past 12 months. Therefore they may not have even set up a personal tax account yet. So, they will still have to go through the verification process. And if they can’t do this online, they have to follow the DWP’s latest policy of ‘don’t call us, we’ll call you’. Therefore, if you can’t prove your ID online you’ll have to wait while the DWP sorts it. For a final sting in the tail, many of these people may be the poorest in the UK. Research shows it’s generally those classed as “low-skilled” (therefore low pay) who don’t have, for example, a passport.
But none of this resolves the other underlying issues with Universal Credit that 1.4 million people will be facing.
The DWP has an inbuilt five-week wait for the first payment of Universal Credit. If people can’t wait that long, the DWP offers them an advance on this first payment. These are effectively loans. Claimants make repayments for the advance, spread out over 12 months. Policy in Practice has noted that these advances are often pushing already struggling people into debt.
But given that many of the current new claimants to Universal Credit may well be self-employed, the five-week wait and advance payments could be catastrophic. Research from investment company Fidelity found that 30% of self-employed people are not saving money or are unable to. So if these people are applying for Universal Credit due to losing work because of coronavirus, it could be a disaster.
The DWP may have sped up the Universal Credit process for a limited number of people. But it’s done nothing to sort the five-week payment wait for everyone; a wait one MP called a “fatal flaw”. The department is now merely tinkering around the edges of a system that was already unfit for purpose long before anyone had ever heard of coronavirus.
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