Recommendations & Conclusions
27 items
18
Recommendation
Second Report - Welfare policy in Scotl…
Rejected
We recommend that the UK Government closely review the issue of making permanent the £20 uplift in the run up to the expiration of this policy at the end of September 2021, whilst also taking into account the significant financial costs such a change would impose. We also recommend that …
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We recommend that the UK Government closely review the issue of making permanent the £20 uplift in the run up to the expiration of this policy at the end of September 2021, whilst also taking into account the significant financial costs such a change would impose. We also recommend that the UK Government should again review whether 6 Welfare policy in Scotland this uplift should be extended and back-dated to legacy benefit recipients so that they do not lose out on this increase in benefits through no fault of their own due to which benefit they receive. We note that similar recommendations were made by the Work and Pensions Select Committee, the House of Lords Economic Affairs Committee and the Social Security Advisory Committee within the last year.
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Government response AI summary
The government rejects the recommendation to extend the £20 uplift to legacy benefits, stating there was never a plan to do so, and implies the uplift for UC was a temporary measure during the pandemic, now focusing on the 'Plan for Jobs' for economic recovery.
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Scotland Office
19
Recommendation
Second Report - Welfare policy in Scotl…
Rejected
We also recommend that DWP raise the work allowance for Universal Credit claimants and re-establish work allowances for single adult claimants so that they can keep more of the money they earn, to allow them to work their way out of poverty.
Government response AI summary
The government rejects the recommendation to extend work allowances to single adults, stating it has no such plans and that work allowances are targeted at those with the greatest barriers to the labour market. It highlights previous increases and annual uprating.
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Scotland Office
20
Conclusion
Second Report - Welfare policy in Scotl…
Rejected
We welcome the improvements made to the advance payment system, such as the doubling of the amount of time to repay, and a reduction in the rate at which deductions can be made. We also acknowledge the advance system is in place for people who require money quickly, however, the …
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We welcome the improvements made to the advance payment system, such as the doubling of the amount of time to repay, and a reduction in the rate at which deductions can be made. We also acknowledge the advance system is in place for people who require money quickly, however, the weight of evidence received suggests that this policy poses more problems than it solves in terms of people addressing poverty in Scotland with claimants having to pay back their advance payment in monthly instalments meaning their Universal Credit payment is less, making paying for essentials much harder.
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Government response AI summary
The government explains the existing advance payment system, including extended repayment periods, and rejects non-repayable advances due to fraud risk, administrative burden, and high costs.
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Scotland Office
21
Recommendation
Second Report - Welfare policy in Scotl…
Rejected
We recommend that the DWP consider alternative arrangements to the five week wait for a first payment and associated advances system (which currently acts as an interest free loan) and should consider again the recommendation from the Work and Pensions Select Committee of implementing a ‘starter payment’ to a claimant …
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We recommend that the DWP consider alternative arrangements to the five week wait for a first payment and associated advances system (which currently acts as an interest free loan) and should consider again the recommendation from the Work and Pensions Select Committee of implementing a ‘starter payment’ to a claimant two weeks after their initial claim. This change would assist claimants in climbing their way out of poverty and address the issues that have affected claimants as a result of the five week wait and associated advance payment system on Universal Credit.
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Government response AI summary
The government rejects alternative arrangements like a 'starter payment', defending its existing New Claim Advances system and citing increased fraud risk, administrative burden, and high costs for non-repayable grants.
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Scotland Office
23
Recommendation
Second Report - Welfare policy in Scotl…
Rejected
Whilst the economy is in the midst of recovering from the covid-19 pandemic, and with the jobs market in great difficulty and 490,000 people (as of March 2021) in Scotland claiming Universal Credit, based on the overwhelming evidence from witnesses, now is not the right time to sanction claimants should …
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Whilst the economy is in the midst of recovering from the covid-19 pandemic, and with the jobs market in great difficulty and 490,000 people (as of March 2021) in Scotland claiming Universal Credit, based on the overwhelming evidence from witnesses, now is not the right time to sanction claimants should they fail to meet their claimant commitment. We recommend pausing sanctioning of claimants for at least the rest of 2021 with immediate effect. However, we welcome the assurances from the DWP that the claimant commitment will take into account local and national public health guidelines. We recommend that the DWP continue this position until all restrictions ease across the entire UK. (Paragraph 129) Welfare policy in Scotland 7 Universal Credit Scottish Choices
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Government response AI summary
The government rejects the recommendation to pause sanctioning, stating that Work Coaches already ensure claimant commitments are reasonable and consider Covid-19 circumstances, and existing appeal and hardship payment processes are in place.
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Scotland Office
94
Recommendation
Second Report - Welfare policy in Scotl…
Rejected
We recommend that there should be an increase in resources and support for claimants who struggle or cannot make a claim online—for example telephone and or video call appointments. The DWP should provide more financial resources for the Help to Claim service run by Citizens Advice Scotland to ensure it …
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We recommend that there should be an increase in resources and support for claimants who struggle or cannot make a claim online—for example telephone and or video call appointments. The DWP should provide more financial resources for the Help to Claim service run by Citizens Advice Scotland to ensure it is fully equipped to deal with the rise in job losses expected as the year progresses. 227 Q178 228 Q178 229 Citizens Advice Scotland (WPS0014) 230 Q208 231 Q208 232 Q208 38 Welfare policy in Scotland 6 Does Universal Credit reduce poverty in Scotland? Adequacy of Universal Credit in Scotland
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Government response AI summary
The government rejects the call for increased resources, stating existing provisions are sufficient, including the Freephone helpline, Jobcentre support, recruitment of additional Work Coaches, and continued funding for Citizens Advice Scotland's Help to Claim service.
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Scotland Office
98
Conclusion
Second Report - Welfare policy in Scotl…
Rejected
Many of the stakeholders told us that increasing the amount of money that claimants receive through Universal Credit would be effective in reducing poverty in Scotland. We heard from Kirsty McKechnie at the Child Poverty Action Group that ‘the way to alleviate poverty is to give people more money and …
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Many of the stakeholders told us that increasing the amount of money that claimants receive through Universal Credit would be effective in reducing poverty in Scotland. We heard from Kirsty McKechnie at the Child Poverty Action Group that ‘the way to alleviate poverty is to give people more money and to put the money into people’s pockets so that it becomes a cash-first response to these issues.’237 Nina Ballantyne from Citizens Advice Scotland agreed with this point of view saying that people should be given ‘enough [money] to live on’238 and highlighted that increasing the adequacy of Universal Credit ‘prevents additional strain on public services elsewhere.’239 Professor McKendrick, Glasgow 233 Department for Work and Pensions, Universal Credit: What you’ll get, April 2021 234 The Trussell Trust (WPS0006) 235 Q105 236 Q63 237 Q84 238 Q84 239 Q84 Welfare policy in Scotland 39 Caledonian University, agreed saying that the ‘root of the problem is the adequacy of the income’.240 He argued that ‘most people know how to manage their money. They just need enough money to manage.’241
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Government response AI summary
The government stated that the Universal Credit uplift was temporary, focusing instead on supporting people back into work through schemes like Kickstart rather than a permanent increase in benefits.
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Scotland Office
102
Recommendation
Second Report - Welfare policy in Scotl…
Rejected
We are also aware of other Parliamentary Committees and statutory bodies that have investigated the issue of making the £20 uplift permanent and extending it to legacy benefit claimants. The Work and Pensions Select Committee recommended in their Report into DWP’s response to the coronavirus outbreak that the DWP should …
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We are also aware of other Parliamentary Committees and statutory bodies that have investigated the issue of making the £20 uplift permanent and extending it to legacy benefit claimants. The Work and Pensions Select Committee recommended in their Report into DWP’s response to the coronavirus outbreak that the DWP should ‘increase the rates of relevant legacy benefits by the equivalent amount’255 as Universal Credit has been. This was preceded by a letter written in May 2020 to the Secretary of State for Work and Pensions by the Social Security Advisory Committee, an independent statutory body which advises the Secretary of State on social security and related matters. Their letter stated that it was ‘of the strong view that it is increasingly untenable for this group of claimants [legacy benefit recipients] to be excluded and to continue to have a lower level of income than those in receipt of Universal Credit and Working Tax Credit.’256 It went on to recommend that legacy benefits should be ‘brought up to the same level as those in receipt of Universal Credit as soon as it is possible to do so.’257 The House of Lords Economics Affairs Committee commented on the uplift recommending that ‘The Government should commit to making the increase in the standard allowance permanent’258 in their Report into the economics of Universal Credit.
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Government response AI summary
The government rejected making the £20 uplift permanent or extending it to legacy benefits, stating the uplift was temporary and focused on Universal Credit/Working Tax Credit claimants due to the pandemic's specific economic shock. Instead, the government emphasized its Plan for Jobs.
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Scotland Office
103
Conclusion
Second Report - Welfare policy in Scotl…
Rejected
The Scottish Government in their evidence to us highlighted that they had a ‘number of concerns around the adequacy of the payment [on Universal Credit] even before coronavirus.’259 The Cabinet Secretary for Social Security and Older People also said that the Scottish Government’s view on whether the £20 uplift should …
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The Scottish Government in their evidence to us highlighted that they had a ‘number of concerns around the adequacy of the payment [on Universal Credit] even before coronavirus.’259 The Cabinet Secretary for Social Security and Older People also said that the Scottish Government’s view on whether the £20 uplift should be made permanent and extended to legacy benefits was that it ‘absolutely should remain a permanent fixture and indeed extended to legacy benefits.’260 Additionally, in Scottish Government’s written evidence they ‘noted new research which estimates that removing the £20 uplift and reinstating the Minimum Income Floor261 in April 2021 would reduce spending on Universal Credit and Tax Credits in Scotland by nearly half a billion pounds in 2021/22, pushing 60,000 people, including 20,000 children, into relative poverty.’262 In written evidence, the Scottish Government Cabinet Secretary for Social Security and Older People, highlighted that she had ‘continually engaged with the UK Government in order to raise issues with the reserved elements of social security’263 and that part of that work included writing to the Secretary of State for Work and Pensions along with her Welsh 251 Q64 252 Q84 253 Q109 254 Q110 255 Work and Pensions Committee, First Report of Session 2019–21, DWP’s response to the coronavirus, HC 178, Para 62 256 Department for Work and Pensions, ‘Covid 19 SSAC letter to the Secretary of State’, accessed 26 April 2021 257 Department for Work and Pensions, ‘Covid 19 SSAC letter to the Secretary of State’, accessed 26 April 2021 258 House of Lords, Universal Credit isn’t working: proposals for reform, Second Report of the Select Committee on Economics Affairs, Session 2019–21, HL 105, Para 129 259 Q139 260 Q139 261 An assumed level of earnings that the DWP uses to calculate benefit payments for self-employed people who are unable to work and are claiming Universal Credit as a result. 262 Scottish Government (WPS0013) 263 Scottish Government (W
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Government response AI summary
The government rejects the view that the Universal Credit uplift should be made permanent and extended to legacy benefits, stating it was a temporary measure and there was no plan to extend it, focusing instead on helping people into work through its Plan for Jobs.
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Scotland Office
104
Conclusion
Second Report - Welfare policy in Scotl…
Rejected
The UK Government announced in the Budget in March 2021 that the £20 uplift would remain until the end of September 2021.265 In explaining to us why the uplift was not made permanent the Minister for Welfare Delivery noted the expense of the policy saying that the ‘cost of extending …
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The UK Government announced in the Budget in March 2021 that the £20 uplift would remain until the end of September 2021.265 In explaining to us why the uplift was not made permanent the Minister for Welfare Delivery noted the expense of the policy saying that the ‘cost of extending the Universal Credit uplift for a 12-month period is some £6.4 billion’.266 He went on to talk about other factors noting that the UK Government had always been clear since the uplift was introduced that it would be a ‘temporary measure to support those who were facing the most financial disruption or economic shock’267 as a result of the covid-19 pandemic. He also said that the UK Government ‘very much hope and expect that we will be in a much better position in terms of the labour market’268 by the end of September with the vaccine roll out and restrictions being lifted allowing for more people to get into work. To support people getting into work he also highlighted the 13,500 new work coaches being employed to support and empower people back into work following the pandemic.269 James Heywood from the Centre for Policy Studies gave evidence to the Work and Pensions Committee’s inquiry into DWP’s response to coronavirus highlighting that there are other reasons for not maintaining the £20 uplift in Universal Credit permanently. He argued that uplifting benefits ‘does have an impact on work incentives’270 as ‘out-of-work incomes are higher relative to in-work incomes.’271 He went on to say that this uplift has an unequal impact on claimants as it: constitutes a 36% increase in the standard allowance for a single claimant under 25. It is only a 19% increase in the standard [allowance] for a couple over 25.272 Work allowances in Universal Credit
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Government response AI summary
The government reiterated that the Universal Credit uplift was a temporary measure during the pandemic, and its strategy focuses on supporting people back into work through initiatives like the Plan for Jobs and Kickstart Scheme.
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Scotland Office
105
Conclusion
Second Report - Welfare policy in Scotl…
Rejected
We have heard in evidence that there are other levers that the DWP could pull to change the Universal Credit system to help to tackle poverty in Scotland alongside increasing adequacy of payments. One option that Citizens Advice Scotland and the Joseph Rowntree Foundation recommended was that the DWP could …
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We have heard in evidence that there are other levers that the DWP could pull to change the Universal Credit system to help to tackle poverty in Scotland alongside increasing adequacy of payments. One option that Citizens Advice Scotland and the Joseph Rowntree Foundation recommended was that the DWP could increase the work allowance a claimant receives and extend work allowances to everyone on Universal Credit.273
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Government response AI summary
The government explicitly states it has no plans to extend the work allowance to single adults, explaining its current policy of targeting those with the greatest barriers to the labour market and detailing past increases.
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Scotland Office
107
Conclusion
Second Report - Welfare policy in Scotl…
Rejected
Should a claimant earn more than their work allowance, their Universal Credit payments will be reduced at a rate (known as a taper rate) of 63p for every £1 earned.275 However, since 2015 ‘only people with limited capability for work, or, people with a child or children are entitled to …
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Should a claimant earn more than their work allowance, their Universal Credit payments will be reduced at a rate (known as a taper rate) of 63p for every £1 earned.275 However, since 2015 ‘only people with limited capability for work, or, people with a child or children are entitled to a Work Allowance’276 as a result of the Universal Credit Work Allowance Amendment Regulations.277 This means that claimants without children or a limiting health condition are not entitled to any work allowance: consequently, as soon as they start earning money from a job, they are subject to the taper rate as described above. Written evidence from Citizen’s Advice Scotland noted that a majority of people ‘new’ to their benefit advice services since April 2020 are currently impacted by this policy choice, where ‘Over 6 in 10 (62%) of the clients seeking Universal Credit advice for the first time since April do not have children nor a limiting health condition/disability–therefore will not be entitled to any Work Allowance.’278
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Government response AI summary
The government defends its policy of targeting the work allowance to those with the greatest barriers to the labour market, stating it has no plans to extend it to single adults, and highlights past increases to work allowances.
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Scotland Office
108
Recommendation
Second Report - Welfare policy in Scotl…
Rejected
Neil Cowan from The Poverty Alliance told us that with current work allowance arrangements have led to employment ‘becoming less, rather than more, reliable as a route out of poverty.’279 Nina Ballantyne of Citizens Advice Scotland called for the work allowance to be increased so that people can take on …
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Neil Cowan from The Poverty Alliance told us that with current work allowance arrangements have led to employment ‘becoming less, rather than more, reliable as a route out of poverty.’279 Nina Ballantyne of Citizens Advice Scotland called for the work allowance to be increased so that people can take on work ‘without being terrified it is going to affect their allowance straightaway’.280 They went on to highlight that this would allow for Universal Credit to ‘be part of the economic recovery’.281 Extending the work allowance to all workers was also noted by Citizen’s Advice Scotland in their written evidence as an important way for all households to recover from the covid-19 income crisis: Particularly in the current uncertain economic climate, the ability to take on what could be precarious work, safe in the knowledge that a person’s UC entitlement will be unaffected until they earn over the Work Allowance threshold would help bring more financial certainty to many people.282
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Government response AI summary
The government rejects extending the work allowance to single adults, stating it is targeted at those with the greatest barriers to the labour market and is increased annually as part of the normal uprating process.
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Scotland Office
111
Recommendation
Second Report - Welfare policy in Scotl…
Rejected
We recommend that the UK Government closely review the issue of making permanent the £20 uplift in the run up to the expiration of this policy at the end of September 2021, whilst also taking into account the significant financial costs such a change would impose. We also recommend that …
Read more
We recommend that the UK Government closely review the issue of making permanent the £20 uplift in the run up to the expiration of this policy at the end of September 2021, whilst also taking into account the significant financial costs such a change would impose. We also recommend that the UK Government should again review whether this uplift should be extended and back-dated to legacy benefit recipients so that they do not lose out on this increase in benefits through no fault of their own due to which benefit they receive. We note that similar recommendations were made by the Work and Pensions Select Committee, the House of Lords Economic Affairs Committee and the Social Security Advisory Committee within the last year.
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Government response AI summary
The government rejects the recommendation, stating the £20 uplift was always a temporary measure for Universal Credit claimants and there was never a plan to extend it to legacy benefits, instead focusing on helping people into work.
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Scotland Office
112
Recommendation
Second Report - Welfare policy in Scotl…
Rejected
We also recommend that DWP raise the work allowance for Universal Credit claimants and re-establish work allowances for single adult claimants so that they can keep more of the money they earn, to allow them to work their way out of poverty. Universal Credit and the five week wait for …
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We also recommend that DWP raise the work allowance for Universal Credit claimants and re-establish work allowances for single adult claimants so that they can keep more of the money they earn, to allow them to work their way out of poverty. Universal Credit and the five week wait for a first Universal Credit payment
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Government response AI summary
The UK Government rejects extending the work allowance to single adults and states that work allowances are increased annually as part of normal uprating, highlighting a past increase in 2018, but does not commit to a specific new raise beyond routine adjustments.
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Scotland Office
113
Conclusion
Second Report - Welfare policy in Scotl…
Rejected
Beyond the adequacy of the Universal Credit system we heard further evidence highlighting that there were other issues with how Universal Credit works and that these issues were causing hardship for claimants in Scotland. A particular issue was the five week wait for a first payment of Universal Credit for …
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Beyond the adequacy of the Universal Credit system we heard further evidence highlighting that there were other issues with how Universal Credit works and that these issues were causing hardship for claimants in Scotland. A particular issue was the five week wait for a first payment of Universal Credit for claimants and the associated advance payment system.
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Government response AI summary
The government explained how Universal Credit Advance payments function to mitigate the five-week wait, including an extended repayment period, and rejected the introduction of non-repayable advances due to fraud risks, administrative burden, and significant costs.
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Scotland Office
114
Conclusion
Second Report - Welfare policy in Scotl…
Rejected
Universal Credit is paid once a month, usually into a claimant’s bank, building society or credit union account. After applying for Universal Credit, it usually takes around five weeks for a new claimant to get their first payment. Universal Credit is paid monthly and in arrears. This is a deliberate …
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Universal Credit is paid once a month, usually into a claimant’s bank, building society or credit union account. After applying for Universal Credit, it usually takes around five weeks for a new claimant to get their first payment. Universal Credit is paid monthly and in arrears. This is a deliberate design choice intended to ‘mimic the world of work by paying people monthly, in arrears.’289 The wait before the first payment is made up of a one-month assessment period and up to seven days for the payment to reach the claimant’s account.290
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Government response AI summary
The government details the existing repayable advance system and rejects the introduction of non-repayable advances, citing increased fraud risk, potential for inappropriate gain, and estimated costs between £2.2 and £2.8 billion.
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Scotland Office
117
Conclusion
Second Report - Welfare policy in Scotl…
Rejected
The Poverty Alliance in their written evidence to us highlighted that from their research they found that the five week wait was ‘the most negative aspect of Universal Credit for many people.’295 They argue that the policy is a major driver of poverty and destitution and has forced people into …
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The Poverty Alliance in their written evidence to us highlighted that from their research they found that the five week wait was ‘the most negative aspect of Universal Credit for many people.’295 They argue that the policy is a major driver of poverty and destitution and has forced people into income crisis and food insecurity.296 Citizens Advice Scotland also highlighted that for people who have no savings or without family or friends to borrow money from the policy ‘forces people to use foodbanks; accumulate debt; and, causes detriment to their physical and mental health.’297 Their evidence also notes that: ‘A significant number of people do not have a financial buffer in the form of a final month’s salary to rely on during the five week waiting period [ … ] [and] 1 in 4 people living in Scotland have less than £500 in savings.’298
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Government response AI summary
The government stated that claimants can access advances on their Universal Credit payment, detailing the repayment terms and recent changes. It rejected the idea of non-repayable advances, citing increased fraud risk, administrative burden, and significant costs.
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Scotland Office
118
Conclusion
Second Report - Welfare policy in Scotl…
Rejected
Should a claimant require money before the five week wait has been completed they can apply for an advance payment. This means a claimant can receive an advance worth the amount of their first estimated payment on Universal Credit.299 According to the Minister for Welfare Delivery, Will Quince MP, these …
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Should a claimant require money before the five week wait has been completed they can apply for an advance payment. This means a claimant can receive an advance worth the amount of their first estimated payment on Universal Credit.299 According to the Minister for Welfare Delivery, Will Quince MP, these advance payments can be made to claimants ‘usually within 24 hours, certainly within a small handful of days.’300 The advance payment needs to be paid back; however, a claimant does not pay interest on the payment—the total amount received as an advance is the same amount that is paid back to the DWP. The money is reclaimed by the DWP in the subsequent payments that the claimant receives from Universal Credit. As of, 12 April 2021, the conditions for advance payments have changed. Rather than pay back the advance over a 12-month period, claimants can now pay back their advance over a 24 month period if they prefer and the rate at which deductions of Universal Credit payments are made to pay for the advance has decreased from 30% to 25%.301
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Government response AI summary
The government outlines the existing repayable advance system, including the extended 2-year repayment period for advances, and rejects the introduction of non-repayable advances due to fraud risks, potential for inappropriate gain, and significant costs.
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Scotland Office
119
Conclusion
Second Report - Welfare policy in Scotl…
Rejected
Again, the UK Government provides an example on their website: • Your first estimated payment is £344 and you get £344 as an advance. 291 Department for Work and Pensions, Universal Credit: How you’re paid, accessed 14 April 2021 292 Q46 293 Q115 294 The Trussell Trust (WPS0006) 295 The …
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Again, the UK Government provides an example on their website: • Your first estimated payment is £344 and you get £344 as an advance. 291 Department for Work and Pensions, Universal Credit: How you’re paid, accessed 14 April 2021 292 Q46 293 Q115 294 The Trussell Trust (WPS0006) 295 The Poverty Alliance (WPS0018) 296 The Poverty Alliance (WPS0018) 297 Citizens Advice Scotland (WPS0014) 298 Citizens Advice Scotland (WPS0014) 299 Department for Work and Pensions, Universal Credit: Get an advance on your first payment, accessed 14 April 2021 300 Q196 301 HM Treasury, Budget 2021, accessed 23 April 2021 Welfare policy in Scotland 45 • You choose to pay back your advance over 24 months, which is £14.33 per month. You’ll get £329.67 on your first payment date - this is your first payment minus the bit you’re repaying (£344 minus £14.33).302
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Government response AI summary
The government explained that New Claim Advances allow claimants to access their estimated Universal Credit payment upfront, with repayment now spread over 2 years for advances issued from April 2021. It rejected the introduction of non-repayable advances, citing fraud risk, administrative burden, and estimated costs …
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Scotland Office
120
Conclusion
Second Report - Welfare policy in Scotl…
Rejected
The advance payment system was commented on critically by our witnesses. Kirsty McKechnie of the Child Poverty Action Group said that advances ‘contribute to the ongoing hardship that people experience on Universal Credit and the difficulty in making ends meet from one end of the month to the next.’303 Nina …
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The advance payment system was commented on critically by our witnesses. Kirsty McKechnie of the Child Poverty Action Group said that advances ‘contribute to the ongoing hardship that people experience on Universal Credit and the difficulty in making ends meet from one end of the month to the next.’303 Nina Ballantyne from Citizens Advice Scotland highlighted how an advance ‘functions like a loan, so even if people do take it out what they are left with is a much lower payment for the months thereafter, meaning what was already a subsistence payment is that much harder to cover things with additional money taken off it.’304 The Trussell Trust said that whilst advances were designed to mitigate against the challenge of the five week wait they have also ‘turned an immediate shock of hardship into a prolonged lower level of income [which has] equally dramatic effects on people’s ability to afford essentials.’305 Money Advice Moray argued that: ‘Claimants should not be penalised for having to take out advances because of the 5 week wait imposed on them.’306 On this issue Citizens Advice Scotland stated simply that: ‘Placing people into a cycle of debt should not be a tenet of the Universal Credit system.’307
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Government response AI summary
The government details the existing repayable advance system, including recent changes, and rejects the introduction of non-repayable advances, citing fraud risks, potential for inappropriate gain, and significant costs between £2.2 and £2.8 billion.
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Scotland Office
121
Conclusion
Second Report - Welfare policy in Scotl…
Rejected
Our colleagues on the Work and Pensions Select Committee recently held an inquiry entitled Universal Credit: the wait for a first payment. They recommended the DWP should: pay all first time claimants of Universal Credit a “starter payment” equivalent to three weeks of the Standard Allowance of Universal Credit. This …
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Our colleagues on the Work and Pensions Select Committee recently held an inquiry entitled Universal Credit: the wait for a first payment. They recommended the DWP should: pay all first time claimants of Universal Credit a “starter payment” equivalent to three weeks of the Standard Allowance of Universal Credit. This payment should be made two weeks after the initial claim, and only once the claimant’s identity has been verified, to mitigate the risk of fraud.308 The Work and Pensions Committee said that it had received evidence in its inquiry that was overwhelmingly in favour of an initial non-repayable payment for new Universal Credit claimants. The Committee argued this “starter payment” would ensure claimants would have the money needed for basic living essentials like food and heating.309 The DWP responded to this recommendation saying that the advance payment system already in place means that money is ‘available urgently to claimants if they are in need of financial help’ and that the introduction of non-repayable starter payments would increase fraud risk in the welfare system.310
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Government response AI summary
The government rejects the introduction of non-repayable advances, explaining that New Claim Advances already allow claimants to receive payment upfront and arguing that non-repayable grants would increase fraud risk, impose administrative burdens, and be costly.
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Scotland Office
123
Recommendation
Second Report - Welfare policy in Scotl…
Rejected
We recommend that the DWP consider alternative arrangements to the five week wait for a first payment and associated advances system (which currently acts as an interest free loan) and should consider again the recommendation from the Work and Pensions Select Committee of implementing a ‘starter payment’ to a claimant …
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We recommend that the DWP consider alternative arrangements to the five week wait for a first payment and associated advances system (which currently acts as an interest free loan) and should consider again the recommendation from the Work and Pensions Select Committee of implementing a ‘starter payment’ to a claimant two weeks after their initial claim. This change would assist claimants in climbing their way out of poverty and address the issues that have affected claimants as a result of the five week wait and associated advance payment system on Universal Credit. DWP and sanctions
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Government response AI summary
The government rejects the recommendation to consider alternative arrangements, such as a starter payment, stating that introducing non-repayable advances would increase fraud risk, allow inappropriate gain, and cost between £2.2 and £2.8 billion.
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Scotland Office
129
Recommendation
Second Report - Welfare policy in Scotl…
Rejected
Whilst the economy is in the midst of recovering from the covid-19 pandemic, and with the jobs market in great difficulty and 490,000 people (as of March 2021) in Scotland claiming Universal Credit, based on the overwhelming evidence from witnesses, now is not the right time to sanction claimants should …
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Whilst the economy is in the midst of recovering from the covid-19 pandemic, and with the jobs market in great difficulty and 490,000 people (as of March 2021) in Scotland claiming Universal Credit, based on the overwhelming evidence from witnesses, now is not the right time to sanction claimants should they fail to meet their claimant commitment. We recommend pausing sanctioning of claimants for at least the rest of 2021 with immediate effect. However, we welcome the assurances from the DWP that the claimant commitment will take into account local and national public health guidelines. We recommend that the DWP continue this position until all restrictions ease across the entire UK. 318 The Poverty Alliance (WPS0018) 319 Q101 320 Q101 321 Q101 322 Q101 323 House of Lords, Universal Credit isn’t working: proposals for reform, Second Report of the Select Committee on Economics Affairs, Session 2019–21, HL 105, Para 129 324 House of Lords, Universal Credit isn’t working: proposals for reform, Second Report of the Select Committee on Economics Affairs, Session 2019–21, HL 105, Government response, October 2020 48 Welfare policy in Scotland 7 Universal Credit Scottish Choices
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Government response AI summary
The government implicitly rejects pausing sanctions, stating that Work Coaches will continue to ensure claimant commitments are reasonable and consider 'good reason' for failures, including Covid-19 related circumstances, when deciding on sanctions.
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Scotland Office
138
Conclusion
Second Report - Welfare policy in Scotl…
Rejected
Another barrier to people signing up to Scottish Choices is that claimants cannot access the choices immediately, instead having to wait until they have received their first Universal Credit payment before taking up one or both options. Citizens Advice Scotland highlighted to our predecessor Committee on their inquiry on welfare …
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Another barrier to people signing up to Scottish Choices is that claimants cannot access the choices immediately, instead having to wait until they have received their first Universal Credit payment before taking up one or both options. Citizens Advice Scotland highlighted to our predecessor Committee on their inquiry on welfare policy in Scotland that this can cause particular problems for claimants who opt for twice-monthly payments as they only receive half of their Universal Credit award at the end of their second month on Universal Credit; they then have to wait a further fifteen days for the second half of their payment to come through to their account.337
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Government response AI summary
The government explains that the Scottish Government's policy is to offer Scottish Choices in the second assessment period, allowing time for Alternative Payment Arrangements to protect vulnerable claimants, effectively justifying the current delay in access.
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Scotland Office
142
Recommendation
Second Report - Welfare policy in Scotl…
Rejected
Polly Jones from The Trussell Trust told us that: There are quite complicated discussions and arrangements between DWP and Scottish Government on how this is managed and how many minutes a work coach can spend talking about Scottish Choices in the second assessment interview.348 They recommend that instead: ‘It would …
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Polly Jones from The Trussell Trust told us that: There are quite complicated discussions and arrangements between DWP and Scottish Government on how this is managed and how many minutes a work coach can spend talking about Scottish Choices in the second assessment interview.348 They recommend that instead: ‘It would be much more straightforward to be able to present the system [Scottish Choices] in the first place [interview]’349 and for the claimant to be able to review their position at a later point to ensure that the Scottish Choices were supporting their circumstances as best as possible.350 The Scottish Government was also concerned that uptake of Scottish Choices may be lower than expected because the DWP was reluctant for ‘Scottish Choices to be discussed right at the start of a Universal Credit journey.’351
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Government response AI summary
The government rejects the implied recommendation to present Scottish Choices in the first interview, stating that the current policy offers them in the second assessment period to allow claimants time to consider DWP Alternative Payment Arrangements.
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Scotland Office
148
Recommendation
Second Report - Welfare policy in Scotl…
Rejected
The Scottish Government and the DWP should work together and seek agreement before announcing further Scottish Choices options to ensure there is no delay in roll out. We therefore recommend the following: a) That Scottish Choices be made available to a claimant from the start of their Universal Credit claim. …
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The Scottish Government and the DWP should work together and seek agreement before announcing further Scottish Choices options to ensure there is no delay in roll out. We therefore recommend the following: a) That Scottish Choices be made available to a claimant from the start of their Universal Credit claim. 357 Scottish Federation of Housing Associations (WPS0017) 358 Scottish Government (WPS0013) 359 Q149 360 Q149 361 Q150 362 Q150 363 Q150 364 Q199 365 Q199 366 Q199 367 Q199 Welfare policy in Scotland 53 b) That both the Scottish Government and the DWP better advertise the availability of Scottish Choices through the initial online claim process, through the Citizens Advice Scotland Help to Claim service, and through the first meeting with the work coach. c) That discussions about Scottish Choices between claimants and work coaches happen frequently throughout a claimant’s time on Universal Credit. We understand that these conversations could take place via journal entries if the claimant is happy with this approach. d) That the Scottish Government and the DWP work together and agree details and administration before announcing further Scottish Choices options. This would ensure that there are no delays as has been seen with the roll out of split payment and removal of the underoccupancy charge Scottish Choices options. 54 Welfare policy in Scotland
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Government response AI summary
The government rejected the recommendation to make Scottish Choices available from the start of a Universal Credit claim, stating current policy offers it from the second assessment period to allow consideration of DWP Alternative Payment Arrangements.
Read full response →
Scotland Office