‘A return to the poor law’ Universal Credit slammed after rise in rent arrears

Cllr Troy Gallagher Pic: Dieter Perry

Cllr Troy Gallagher Pic: Dieter Perry - Credit: Archant

“It’s a return to the poor law”: councillors last night criticised the universal credit system after Islington recorded a rise in rent arrears since the new scheme was introduced.

The performance and scrutiny committee on Tuesday heard how some 1,700 people in the borough have claimed for universal credit since it began to be phased in on June 20.

Not all benefits have yet switched over to universal credit, for instance employer child care vouchers are due to be stopped in October, but already there has been a “big increase in rental arrears”, with the an average debt of more than £9,000.

Cllr Troy Gallagher (Lab, Bunhill) said: “Councils are the front line of defence, so we are best placed to see the impact on individual residents.

He later told the Gazette: “This is really going to affect residents and hearing how much debt people are getting into really does give me sleepless nights.”

Cllr Gallagher said his surgery’s used to be attended by seven or eight constituents – but he now gets about 20 people each week since universal credit began to be rolled-out.

When people first apply for the new benefits it can take five weeks for their claim to be processed.

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But there is an advance payment scheme where the claimant can request an up-front payment, which can be up to 100 per cent of their monthly benefits.

The caveat is this money must be paid back over the next 12 months, with cash being deducted from monthly payments.

Cllr Sheila Chapman (Lab, Junction) asked at the meeting what more the council could do to circumnavigate the DWP “structured loan” system.

She heard how the council is able to make discretionary “crisis grants”, and has done six times already.

Cllr Gary Heather (Lab, Finsbury Park) said: “The Government said it would simplify the system but this is even difficult for a councillor to negotiate.

“It’s all on purpose – it’s a return to the poor law. This is a direct attack and its a political thing.”

The council has also been training library staff to help people access their benefits, as the whole process is online.