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DWP delays system development of Universal Credit

‘Bedroom tax’ will continue to have to be mitigated by local authorities’ Discretionary Housing Payments (DHP) until May 2020 at the earliest.

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The DWP is to delay system development of Universal Credit which would have seen the effective abolition of the ‘bedroom tax’ at source, meaning that the policy will continue to have to be mitigated by local authorities’ Discretionary Housing Payments (DHP) until May 2020 at the earliest.

Under the Scotland Act 2016, the ability to vary the housing element of Universal Credit was devolved to the Scottish Parliament, with the Scottish Government committing to use these powers to fully and properly abolish the ‘bedroom tax’ at source. Negotiations had been taking place with the DWP, with the hope that systems would be in place by April 2019.

Angela Constance, Cabinet Secretary for Communities and Local Government, has written to Secretary of State Esther McVey, stating that she was “increasingly concerned that [the DWP] is not consistent in displaying either the willingness nor urgency to deliver".

The SFHA agrees with the Scottish Government's condemnation of the decision.

SFHA Policy Advisor Jeremy Hewer said: 

“From the feedback we get from our members, the systems in place to support Universal Credit are neither sufficiently robust nor reliable with the numbers of claimants they have at the moment. This is why we are urging a pause to the roll-out until systems can be fixed, in order to save everyone – housing associations, local authorities and the DWP itself – from the danger of an administrative meltdown, not to mention the anxiety and distress it will cause claimants themselves. It is understood that, as it stands at the moment, local authorities are finding data sharing problematic, which makes the accurate assessment of entitlement to DHPs a challenge.

“If the development of the system to allow the ‘bedroom tax’ to be abolished will not be in place until May 2020, it will mean that its introduction will be in the midst of the managed migration of claimants on legacy benefits to Universal Credit, so the volume of cases, already increasing sharply with the rollout of Universal Credit Full Service, will swamp the system. At present, only around 10% of housing association tenants receiving support with their housing costs are on Universal Credit – and landlords and local authorities have their hands full as it is.

“The SFHA would urge that the roll-out is paused in order to give a chance for the systems to be brought up to the standard they will need to be. No doubt this is something that will be raised when the Secretary of State appears before the Scottish Parliament Social Security Committee on 16 April.”