Universal credit to be paid to main carer in attempt to help women

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Work and pensions secretary Amber Rudd unveils package of changes to benefits system

Amber Rudd
Amber Rudd said she wanted payments to go to the main carer, ???which is usually but not always the woman???. Photograph: Yui Mok/PA

The government will seek to make universal credit payments to women if they are the household???s main carer, Amber Rudd has said, as part of a package of changes to the heavily criticised benefits system that have been unveiled by the work and pensions secretary.

Rudd, who also said she wanted the long freeze on working-age benefit levels to end next year, used a speech at a jobcentre in south London to further emphasise what she said is a more caring and thoughtful approach to the welfare system.

A key element to this is the news that the planned mass ???migration??? of claimants on existing benefits to universal credit, which replaces a series of payments, would instead be paused so a trial of 10,000 people could be held.

Quick guide

What is universal credit and what are the problems?

What is universal credit?

Universal credit (UC) is the supposed flagship reform of the benefits system, rolling together six benefits (including unemployment and benefits, and tax credits) into one, online-only system. The theoretical aim, for which there was general support across the political spectrum, was to simplify the system and increase the incentives for people to move off benefits into work.

How long has it been around?

The project was legislated for in 2011 under the auspices of its most vocal champion, Iain Duncan Smith. The plan was to roll it out by 2017. However, a series of management failures, expensive IT blunders and design faults  means it is six years behind schedule and rollout will not be complete until 2023.

What is the biggest problem?

The original design set out  a minimum 42-day wait for a first payment to claimants when they moved to UC (in practice this is often up to 60 days). After sustained pressure, the government announced in the autumn 2017 budget that the wait would be reduced to 35 days from February 2018. This will partially mitigate the impact on many claimants of having no income for six weeks. The wait has led to rent arrears and evictions, hunger (food banks in UC areas report notable increases in referrals), use of expensive credit and mental distress. 

Ministers have expanded the availability of hardship loans (now repayable over a year) to help new claimants while they wait for payment. Housing benefit will now continue for an extra two weeks after the start of a UC claim. However, critics say the five-week wait is still too long and want it reduced to two or three weeks.

Are there other problems?

Plenty.  Multibillion-pound cuts to work allowances imposed by the former chancellor George Osborne mean UC is far less generous than originally envisaged. According to the Resolution Foundation thinktank, about 2.5m low-income working households will be more than ??1,000 a year worse off when they move to UC, reducing work incentives.

Landlords are worried that the level of rent arrears accrued by tenants on UC could lead to a rise in evictions. It's also not very user-friendly: claimants complain the system is complex, unreliable and difficult to manage, particularly if you have no internet access.

And there is concern that UC cannot deliver key promises: a critical study found it does not deliver savings, cannot prove it gets more people into work, and has plunged vulnerable claimants into hardship.

???We will tread cautiously,??? on the change, pledged Rudd, who took the work and pensions job when Esther McVey quit in November.

Rudd also confirmed the partial scrapping of the controversial two-child limit on universal credit payments, but only for this benefit and for children born after April 2017, when the wider limit was first introduced.

She defended the cap, and the ???rape clause???, under which women can claim exemption from the policy if they can show they had conceived a third child via domestic abuse or rape. The charity Women???s Aid called the policy ???objectionable??? and likely to hamper some women trying to flee domestic abuse.

In the speech, Rudd said she wanted universal credit to particularly help women, and she understood the criticism over the way the benefit was paid into a single bank account, which could be a problem for some couples or families.

???That???s why I???m committed to ensuring that household payments go directly to the main carer, which is usually but not always the woman,??? she said.

For couples and families, 60% of payments already go to women, she said, adding: ???However, I am looking at what more we can do to enable the main carer to receive the UC payment, and we???ll begin to make those payments later this year.???

Other changes outlined by Rudd include a new online system for private landlords to request direct payments for tenants who have problems managing money, and changes to pay childcare costs in advance if needed.

On the benefits freeze, which was introduced in 2015 by the then chancellor George Osborne and is estimated to have cost some working families hundreds of pounds a year, Rudd confirmed she wanted it to end but had yet to discuss this with the chancellor, Philip Hammond.

Asked about this after the speech, she said: ???The benefits freeze is scheduled to come to an end next year. I haven???t had any further conversations with the chancellor, so I???d better not say anything too definitive at this stage, but it would certainly be my view that it should come to an end at that stage.???

But Rudd defended the principle of the two-child limit: ???I think it is fair that those on welfare make the same considered decisions as other taxpayers who support themselves solely though work.

???So I believe it was right to limit the number of children for whom support can be provided through universal credit funded by the taxpayer. However, I believe it is unfair to apply that limit retrospectively.???

This prompted criticism from Sian Hawkins, Women???s Aid???s head of campaigns, who said children born after April 2017 ???are still subject to this objectionable policy???, while the rape clause exemption ???does not reflect survivors??? lived experience of disclosing domestic abuse and rape???.

She added: ???We know from our work with survivors that many women do not have the confidence to speak out about their experience of domestic abuse or rape due to feelings of shame, worrying about the repercussions for their children and fears of the consequences of doing so.???