Investigation into benefits system comes amid mounting evidence that payment delays have left thousands facing eviction
MPs have launched an official inquiry into universal credit amid growing concerns that design flaws in the new benefits system are leaving thousands of low-income claimants facing eviction and reliant on food banks.
The Commons work and pensions committee said it was compelled to launch a full investigation after mounting evidence that built-in payment delays and administrative blockages were creating severe problems for claimants and landlords.
A Guardian investigation this month found widespread evidence that thousands of tenants on universal credit were running up rent arrears and debts because they could not manage the minimum 42-day wait for a first payment.
Landlords have also criticised the system, with private landlords warning that they will not let to universal credit claimants because of the high risk of rent arrears and problems navigating byzantine official bureaucracy.
Surveys by housing associations have found that up to nine in 10 tenants on universal credit either run up rent arrears or increase the level of pre-existing arrears because so few are equipped to cope with long waits without income.
Frank Field MP, chair of the work and pensions committee said: “Huge delays in people receiving payments from universal credit have resulted in claimants falling into debt and rent arrears, caused health problems and led to many having to rely on food banks.”
The inquiry will ratchet up the pressure on the Department for Work and Pensions to review the design of universal credit. It has played down the impact of the 42-day waiting time, arguing that its research carried out two years ago suggests arrears levels fall after three months once tenants get used to the new system.
But the former welfare minister Lord Freud admitted to MPs last month that at least a quarter of tenants on universal credit had run up rent arrears as a result, and he suggested that ministers should consider shortening waiting times for payment.
The MPs inquiry was announced on the same day that the universal credit full service was rolled out to a handful of new areas, including Poplar in east London and Warrington. The rollout is not due to be complete until September 2018.