ARCH member Croydon Council has jointly commissioned a report by
the Smith Institute on the impact of Universal Credit on tenants
and rent arrears in the London Borough of Southwark and Croydon and
the Peabody Trust.
The terms of reference were to understand:
- How is the early roll-out of Universal Credit (UC) affecting
rent payment behaviours among residents in social housing tenants
in the London borough of Southwark?
- How are identified changes in behaviour - or the absence of
behaviour change - affecting the tenancies of those social housing
tenants who are receiving housing cost support under the new
The work undertaken to answer these questions was split into two
pieces of research. The first was an analysis of 775 tenants' rent
accounts to give a quantitative understanding of how rent
behaviours were changing (compared with rent accounts of those
moving onto Housing Benefit); how rent behaviour changed over time;
whether any arrears accrued were paid down and whether there were
any differences in rent payment behaviour between different
The second piece of research was a qualitative study
commissioned by the Smith Institute and undertaken by the research
This work involved undertaking 36 in-depth telephone interviews
and four focus groups with tenants. The purpose was to: understand
their journey once they found out they were on UC; document and
evaluate their understanding of the new system; and examine what
worked and what could be done better.
The report's findings mirror the issues identified in the latest
ARCH/NFA welfare reform survey "Pause for thought" published in August this
year and come at a time when the government is under significant
pressure to pause the roll out of Universal Credit.
Read the Smith Institute Report "Safe as
The Smith Institute report was launched in
the week when the Commons Work and Pensions Committee published a
report recommending that the Government should aim to cut the
"baked-in" six week wait for the first payment of Universal Credit
to a month, saying this is a major obstacle blocking the potential
success of the Universal Credit policy:
- In areas where the full service has rolled out, evidence
compellingly links it to an increase in acute financial difficulty,
with widespread reports of overwhelmed food banks, problem debt and
steeply rising rent arrears and homelessness.
- Most low-income families simply do not have the savings to see
them through this extended period without resorting to desperate
The Commons Work & Pensions Committee
report also says that while increased availability of Advance
Payment loans of up to half the estimated monthly award are
welcome, the Committee says they are no solution to a fundamental
flaw in the current design of the Universal Credit system:
- Universal Credit seeks to mirror the world of work, but no one
in work waits six weeks for a pay cheque.
- The Committee calls on Government to reduce the standard
waiting time for a first Universal Credit payment to one month.
This would be entirely consistent with the monthly in arrears
philosophy of Universal Credit.
Read the Commons Work & Pensions Committee