Two councils which were amongst the first in the full service universal credit (UC) roll out say that the effects could be ‘catastrophic’ because of the level of debt caused by the initial six week wait.
Southwark and Croydon councils say that after 20 weeks on UC the average claimant owed £156 in rent. Claimants still on the old system had overpaid 4% of their rent on average.
In Southwark, where 12% of council tenants are now on UC, rent arrears now total over £5.3 million. In addition, food bank referrals have risen by 94%, mostly due to welfare reform and UC. The rise amongst families with children is even greater, at a staggering 179%.