Debt warning over Universal Credit roll out

PEOPLE must learn vital skills if they are to stay out of debt as the next wave of welfare changes are introduced in Rugby, a charity has warned.

The shake-up of the benefits system began in the spring with a small pilot of the new Universal Credit payment that merges six working-age benefits into one.

Rugby is one of six areas to begin switching to the new scheme between October and April, and debt experts at Christians Against Poverty (CAP) are concerned some people could be drawn into greater hardship.

The fears centre around the major change which will see payments made once a month rather than fortnightly or weekly as they are currently.

Housing benefit will also no longer go directly to the landlord and it will go into the claimant’s bank account which has caused some problems for some recipients during the pilot.

"We’re at the very start of the system being gradually introduced," said Andrew Lewis, manager of Rugby Debt Centre which is run by CAP in partnership with Bilton Evangelical Church.

"But when it’s fully implemented our worry is some people will be unused to seeing so much in their account and won’t be aware the security of their home depends on them managing it well, a concern too for local landlords.

"The Government seems cautious about bringing in all the aspects of Universal Credit and we would like people to use this time to overhaul their finances and gain control where they can."

A spokesman for the Department of Work and Pension told us in some circumstances payments fortnightly would be still be available as would direct payments to landlords.

"Universal Credit will simplify the complex benefit system and make three million people better off as well as lifting up to 250,000 children out of poverty.

"We have always been clear that support to help people move to Universal Credit will be available with local Jobcentre Plus, councils and community groups working closely together."

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