Photograph by Lydia
A major shake-up to the way people receive benefits begins today, with the first claim being made for the new universal credit payment which combines several benefits and tax credits into a single monthly payout.
The system is being slowly rolled out across the country to six million people over the next four years, with a small number of claimants in Ashton-under-Lyne being the first new claimants today. Pilot projects in Warrington, Oldham, and Wigan have been delayed until July.
The idea of the universal credit is to simplify how people claim benefits and tax credits, by making the application for payment online and combining income-based jobseeker’s allowance, income-related employment and support allowance, income support, child tax credit, working tax credit, and housing benefit into a single monthly payment.
The simplified system is designed to reduce fraud and error, and relies on a complex computer system, but with the system being “online only”, some have argued that it could increase the digital divide and work against families that are less computer literate. The failure of previous large-scale IT projects such as with the NHS has also caused many to worry about the universal credit’s implementation.
The universal credit is part of scheme from Work and Pensions Secretary Iain Duncan Smith who has vowed that people should always be better off in work than on benefits. The government estimates that the system will entitle 3.1 million households to more benefits, whilst 2.8 million households will be negatively impacted and entitled to less.
