Liverpool Mayor urges a 'pause' on Universal Credit amid claims thousands could be left in poverty

Universal Credit's in the spotlight with calls to put it on hold amid fears it could send thousands in Liverpool into a downward spiral of debt

A new report claims the welfare reforms - which are being rolled out in the City from this week - could lead to Poverty or even force people onto the street.

A statement passed to us from Liverpool City Council reads :

Liverpool has been hit hard by welfare reforms and austerity cuts since 2010. Last year Liverpool City Council made more than 13,000 crisis payments to help people with the cost of food, fuel and clothing.

The council and its partner believe the continued rollout of Universal Credit in the city in its current form will lead to a welfare crisis, which will see many more people suffer extreme hardship and the spectre of homelessness.

Mayor of Liverpool Joe Anderson is one of the many voices calling for a period of reflection and an opportunity to fix Universal Credit.

Mayor Anderson says: “Already, we can see a spike in hardship and a rise in council tax arrears from those who have already transitioned to UC. Not to mention the queues at foodbanks and the families struggling with things like school uniform costs.

“Around 55,000 Liverpool households will eventually see their claim move to Universal Credit. Most of these households have already been affected by the ‘benefit freeze.’

“We have found that disabled people, the long-term sick, single parents and working families on low incomes are amongst those disproportionately affected.

“Simply put, if UC continues in its current form, people in Liverpool already facing enduring hardship will be left with even less. Levels of debt will rise, rent arrears will increase, families will be forced into food and fuel poverty and ultimately hardworking people will face the spectre of homelessness and destitution.”

The partnership has produced a new publication entitled ‘Universal Credit: Unintended Consequences’ which it hopes to put before ministers.

The publication contains essays from Bishop of Liverpool, Rt Rev Paul Bayes, the chief executive of The Women’s Organisation, Maggie O’Carroll and the chief executive of the city’s Chamber of Commerce Paul Cherpeau.

Headline requests from the partnership include a call for the DWP to cut the wait between applying for UC and receiving payment. Currently applicants can wait up to 35 days without cash.

It also calls for councils to be given more ring-fenced funds to provide a ‘local welfare scheme’ based on local needs and an end to the 30-40 minute waiting times for connection to DWP advice and information lines.

Mayor Anderson describes the lack of co-ordination with local authorities as a ‘scandalous oversight’.

He says: “Many councils have been forced to abandon discretionary support amid the austerity cuts they have had to endure, which has removed a vital safety net for the poorest but we have vowed to continue our support.”

Liverpool City Council spends £23 million dealing with a range of crisis issues surrounding poverty and homelessness and offers a range of crisis payments and housing support above and beyond the statutory threshold. In stark contrast, the council will have experienced a £444 million reduction in its funding from central government by 2020.

The National Audit Office recently urged ministers to ‘pause’ the roll-out of UC, with figures showing 40 per cent of claimants experienced financial difficulties transitioning to the new benefit, with a fifth of claimants not paid on time.

The Bishop of Liverpool, The Rt Rev Paul Bayes, warns that a move away from addressing need in the welfare system risks instilling the idea of the deserving and undeserving poor, writing that he is ‘angry’ and ‘frustrated’ at the ill-effects of recent welfare changes.

The Joseph Rowntree Foundation recently reported that Liverpool is the second hardest hit city in the country when it comes to destitution.

Maggie O’Carroll, chief executive of The Women’s Organisation in the city criticises Universal Credit for being a ‘very real barrier’ to those on benefit trying to become self-employed, while the one payment per household model poses ‘an even greater threat’ to vulnerable women who may be at risk of domestic abuse.

Meanwhile, the chief executive of Liverpool Chamber of Commerce, Paul Cherpeau says that any reduction in benefits will reduce spending power in the local economy and ‘stifle our capacity to start and grow businesses in the city’.

Mayor Anderson adds: “We are urging ministers to take heed of the ‘unintended consequences’ of their welfare reforms and take action.”

“We have to believe that these consequences are unintended because who would deliberately perpetuate a system that takes support away from the very poorest in society, that penalises people who are sick and disabled and takes financial support away from children?