Tackling the cost of living crisis

Tackling the Failure of Universal Credit


Newcastle City Council, Gateshead Council, Oxford City Council, Stockport Council, Tower Hamlets Council, Islington Council

The rollout of ‘Universal Credit’ has caused a raft of problems for low income families, ranging from increases in debt, to homelessness, mental health issues, and domestic violence. Labour councils that were ‘pilot’ areas for the reforms sounded an early warning that the change to benefits was causing harm, and have often stepped in with emergency measures to try to reduce and mitigate the harmful impact on their local residents. Newcastle City Council is one of many Labour councils to have agreed measures to combat the raft of problems caused by Universal Credit

In 2018, Gateshead Council commissioned qualitative research into the impact of the roll out of Universal Credit in the area. It found a system prone to administrative errors that was difficult to navigate, and that was pushing many into debt, rent arrears and serious hardship. The impact of Universal Credit has exacerbated health problems, led to greater food insecurity and increased the risk of eviction and homelessness. The study concluded that the Universal Credit system is not working for claimants and does not simplify the system or improve work outcomes. The UN Special Rapporteur on Extreme Poverty and Human Rights referenced the research in his report.

The failure of Universal Credit pilots and the harmful effects on low income families led to many Labour councils including Oxford, Stockport, and Newcastle, to demand the roll-out be paused and reviewed due to the effect on residents in their area. As further problems have emerged and the government has refused to listen, Labour councils have begun to call for Universal Credit to be scrapped entirely – Tower Hamlets Council passing a motion stating that ‘Universal Credit should be stopped completely, and that a genuinely comprehensive system should be introduced in which nobody will be worse off’, and Islington Council following suit in calling it ‘a Government policy of deliberate destitution’, and calling for it to be scrapped entirely.

The LGA Labour Group exists to fight the corner for Labour councillors at a national level, both within
the cross-party Local Government Association and with the Labour Party at Westminster. The Group provide a strong voice for Labour councillors and act as a platform for ideas and innovation for all those committed to an effective localist element to Labour politics and policies.

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