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    Report reveals causal link between homelessness and universal credit

    Report also reveals a link between universal credit and mental health problems.

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    A damning new report from the Scottish Government reveals a causal link between homelessness and the UK Government’s flagship Universal Credit system.

    Universal Credit merges a number of so-called ‘legacy benefits’ into one single monthly payment, including Employment and Support Allowance and Jobseeker’s Allowance, and has been beset by criticism since its conception.

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    The report highlights how people can be put at significant risk of losing their homes due to problems with the five-week wait for an initial payment.

    It also shows how the controversial sanctions regime can lead to payments being withdrawn if claimants don’t meet certain conditions, leaving them at even greater risk of poverty and homelessness.

    The report, titled ‘Homelessness and Universal Credit’, also found that people who are plunged into rent arrears experience worsening mental health, and it can even lead to the breakdown of relationships.

    It highlights how the Universal Credit caseload has nearly doubled since the beginning of 2020, meaning more people than ever are at risk of being negatively affected.

    The Office for Budget Responsibility’s latest forecasts show that unemployment across the UK could increase by a further 500,000 by the end of the year.

    Despite that, Chancellor Rishi Sunak (pictured below) has so far refused to make the £20 per-week uplift to Universal Credit permanent.

    This means that households face a £1,000 cut to their incomes when the “temporary” boost expires at the end of September 2021.

    Chancellor of the Exchequer Rishi Sunak MP.
    Chancellor of the Exchequer Rishi Sunak MP. Open Government licence.

    This latest research follows a report published by the Joseph Rowntree Foundation in 2020, which found a strong link between Universal Credit and destitution, with the five-week wait cited as the most likely cause.

    And research by the charity Crisis found that homeless people are twice as likely to be hit by benefit sanctions, worsening their chances of escaping homelessness.

    Scotland’s Social Security Secretary Shirley-Anne Somerville said: “While a variety of circumstances can contribute to homelessness, this report paints a stark picture of how people can be plunged into poverty by a poorly executed social security system.

    “The UK welfare system must be made fit for purpose with damaging reforms reversed.”

    She added: “It is disappointing the UK Government plans to cut the £20-per-week uplift in Universal Credit payments in six months’ time and that they have refused to expand it to legacy benefits.

    “Despite predictions of an increase in unemployment of half a million across the UK, unemployment support is being cut to its lowest level since 1990, and the decision to freeze local housing allowance rates from April 2021 will push more people into poverty and put them at risk of homelessness.”

    Commenting, the SNP’s Shadow Scottish Secretary and Scottish Affairs Committee member, Mhairi Black MP, said: “Even before the pandemic, millions of families across the UK were already struggling with debt and turning to food banks as a result of Tory austerity policies.

    “The coronavirus crisis has compounded these challenges and delivered another severe hit to people’s livelihoods and finances.

    “The evidence on this is overwhelming and mounting day by day – but the Tories continue to bury their heads in the sand and claim it is not the case.

    “Either they don’t care about the damage their welfare policies are causing or they are simply inept.

    “The SNP have repeatedly called on the UK government to turn advance payment loans into grants once a person has been deemed eligible – which would abolish the five-week wait – and for the Universal Credit uplift to be made permanent and extended to legacy benefits. Sadly, these calls continue to be ignored.

    “Justin Tomlinson said today that as part of the upcoming Green paper on Health & Disability, the DWP will listen to real lived experiences – as Social Security Scotland do.

    “This is something the SNP have been asking the UK government to do for years, and is something they have repeatedly said they will do – yet we are seeing no evidence of this.

    “Instead, Tory government welfare policies continue to push people into, or further into, poverty, debt and hardship.”

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