HOMELESS individuals and families on the UK Government’s controversial Universal Credit scheme are racking up huge arrears putting services and jobs at risk in Scotland’s largest city, according to a new report.
In a report detailing the impact of the new benefit on homeless people in the city, the council says Glasgow City Council said errors by the Department for Work and Pensions (DWP) have been compounding the problem by mistakenly transferring homeless people on to the initiative.
Homeless people are supposed to be exempt from Universal Credit (UC), which incorporates both income support and housing payments, until the benefit is fully rolled out in the city in September 2018.
Loading article content
But a council report examining the impact on the city’s homeless found that, in a handful of cases, the DWP has registered them for Universal Credit anyway.
The result is they do not receive the full cost of their accommodation. Other problems are being caused by people transferred to UC but who later become homeless because the benefit does not pay the full cost of supported accommodation.
Services and staff are under threat, the report says, with 170 staff working with homeless people whose wages are fully or partly funded by rent charges at an annual cost of £4.9 million.
A total of 73 homeless people in Glasgow are now on the benefit, and they have racked up £144,000 in arrears between them.
In a report to the city’s Integration Joint Board, council finance chief Sharon Wearing said it was vital the council prevented any more homeless residents being entered into the UC system. She said: “Despite homeless clients being exempt from Universal Credit, there have been a number of homeless claimants entering the Universal Credit system in error.”
Yet, even if they should never have been on it, once an applicant is in receipt of Universal Credit, DWP systems prevent them reverting to housing benefit. “Once payment is made, they are locked in to Universal Credit, with no way of transferring”, the report says. “This has a negative financial impact on both the claimant and the council.”
A Glasgow City Council spokesman said: “Welfare reform has already had a significant impact on our budget for homelessness services. The introduction of universal credit is placing further pressure on homelessness budgets and it is anticipated that delivery of these services will become increasingly challenging.
“We will continue to seek ways to mitigate the impact of these changes so we continue to operate an effective service for those affected by homelessness.”
The council says its budgets for temporary homeless accommodation have been cut by £6m in the past five years, and welfare reform will leave a further shortfall of £4m a year by 2018
“Homelessness Services can no longer absorb this level of impact and ... operate a sustainable service that meets its statutory duties,” the report says.
Alison Watson, deputy director for Shelter Scotland, said there were question marks for all councils about the funding of temporary housing.
“By its own admission, Glasgow City Council is already turning people away who have a statutory right to access temporary accommodation,” she said. “Raising the alarm like this must now be followed up with urgent action to ensure funding remains in place for high-quality temporary accommodation.” We are deeply concerned about the impact any loss of funding will have on homeless people.”
A DWP spokesman said: "One person without a home is one too many and we are investing over £500m to tackle homelessness and stop it happening in the first place.
"Local Authorities are best placed to understand the needs of their residents, that's why we will have provided them with around £1bn in funding by 2020 to support people transitioning to our reforms."