Universal credit is forcing people into debt because the applications process is so complex, a new study has found.
Citizens Advice has revealed more than a third of people supported by the charity were left struggling to provide the evidence needed to complete their claim.
And as a result, a quarter of claimants fall into debt because they haven’t received their first full payment on time.
Many claimants, who must wait at least five weeks for the first payment, struggle to provide evidence for health conditions, childcare and housing and are stumped by multiple deadlines.
The charity is now calling on the government to simplify the process.
Gillian Guy, chief executive of Citizens Advice, told The Independent: “Universal credit is working for many people, but a significant minority who receive their first, full payment late stand a higher chance of being put under financial strain.
“The people we helped who were not paid on time were more likely to be in debt, borrow money from a lender and fall behind on their rent.
“Last year, the government showed it was willing to listen and make changes to universal credit. Now it needs to simplify the application process and improve support for people when they do get stuck to avoid hold-ups with payments.”
Universal credit was introduced in 2013 in an attempt to simplify the welfare system by “rolling” six means-tested benefits and tax credits into a single monthly payment.
But critics over the years have highlighted the spike in hardship and demand for food parcels.
A Department for Work and Pensions spokesperson said: “Universal credit simplifies an out-of-date, complex system and we welcome Citizens Advice finding that it is working well for the majority of claimants.
“We continue to listen to feedback and make any necessary improvements during the roll-out with our ‘test and learn’ approach and this report recognises the positive impact of changes we have already made.
“The vast majority of universal credit claimants are paid in full and on time and 100 per cent advance payments can be made available within hours.
“We look forward to working collaboratively with Citizens Advice and others to ensure that the small minority who seek additional help making their claim are able to access it.”
Citizens Advice’s study comes after service centre workers lifted the lid on the “fundamentally broken” universal credit IT system, which was causing a surge in delayed payments.
Whistleblowers have spoken out about the glitches and errors that the system has, which repeatedly leads to benefits being delayed for weeks, or wrongly slashed, The Guardian reported.
One said: “The IT system on which universal credit is built is so fundamentally broken and poorly designed that it guarantees severe problems with claims.”
They claimed the systems were overly complex, prone to breaking, and any errors were slow to fix.
“In practical terms, it is not working the way it was intended and it is having an actively harmful effect on a huge number of claimants,” they added.
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