The new Secretary of State for Work and Pensions has said that even though the managed migration process from legacy benefits to Universal Credit has been delayed until 2027-28, claimants will automatically trigger a move if they report a change in their circumstances.
Mel Stride told the Work and Pensions Committee on Wednesday that supporting the most vulnerable is a “key focus” for the Department for Work and Pensions (DWP). He told the cross-party panel of MPs that his department’s three main objectives are helping the most vulnerable, getting people back into work and cracking down on benefits fraud.
But he was challenged by MPs who suggested the UK Government is taking money from those with the least by delaying moving some legacy claimants on to the new system, through sanctions, and by recovering overpayments.
Mr Stride told the Work and Pensions Committee the UK Government has a “particular duty now to focus on those most in need as we go through these difficult times”.
Conservative MP Nigel Mills challenged the DWP boss over the delay to managed migration of people on legacy benefits such as Employment and Support Allowance (ESA) on to Universal Credit.
The process has been in a ‘discovery phase’ since May, but was due to start ramping up the transfer rate next year ahead of the original completion deadline at the end of 2024.
Mr Stride said 33 per cent of people on ESA are likely to lose out as a consequence of that migration, and 55 per cent will benefit, with savings of around one billion pounds due to the process being delayed.
He said he sees the delay as an “opportunity for a reallocation of resources” to help the department focus on those who need the help.
Mr Mills said it is “extraordinarily unlikely” people will choose to change system, saying: “It’s a bit hard isn’t it, to say we’re trying to help the most vulnerable through this crisis when you’ve just chosen a billion pounds saving literally from the pockets of the absolutely most vulnerable?”
Mr Stride replied: “In an ideal world I’d like to be able to do everything; I’d like to migrate all the ESA people over as quickly as possible, as well as putting certain other benefits up more than perhaps we managed to. But I think in the round, generally, that has been the right decision to have taken.”
Which groups are expected to be better or worse off on Universal Credit?
The DWP estimates ESA claimants who are in the support group but who do not get the Severe Disability Payment to be better off on Universal Credit.
Households who get ESA and receive the Severe Disability Premium and the enhanced disability premium, are expected to be worse off.
More details about which groups could receive a higher or lower entitlement on Universal Credit can be found here.
DWP estimates on who will receive higher or lower entitlements or see no change to the amount of benefit they receive are summarised below.
Higher entitlement after moving to Universal Credit
- ESA claimants: 600,000
- Tax Credits (Working and Child) claimants: 700,000
- Total, including other legacy benefits: 1.4 million
Lower entitlement after moving to Universal Credit
- ESA claimants: 500,000
- Tax Credits (Working and Child) claimants: 300,000
- Total, including other legacy benefits: 900,000
No change after moving to Universal Credit
- ESA claimants: 100,000
- Income Support: 100,000
- Total, including other legacy benefits: 300,000
Benefit deductions
Asked by SNP MP Chris Stephens if overpayments made through error should be deducted from people’s claims during a cost of living crisis, Mr Stride said “in an appropriate way, it is right that that is repaid through time”.
On calls for deductions to be paused temporarily - as had happened during the pandemic - he said if someone is in a realistic position to deal with their debt “then it should be dealt with at that point, rather than letting it accumulate and become more of a problem further down the line”.
Mr Stride told the committee nine million people are economically inactive in the UK and suspects there will be targets for reducing that number.
He said the nine millions is broadly split into four cohorts:
- Over 50s
- People with health conditions
- Students
- Carers
Mr Stride said a UK Government review into barriers to this group entering work will likely conclude in time for next spring and some of it may be shared before the new year.
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