Welfare Reform and Housing Insecurity: The Impact of Universal Credit Rollout on Demand for Rent Arrears and Homelessness Advice from Citizens Advice in England

Abstract

Universal Credit (UC) has been rolling out since 2013 to radically alter the UK welfare system. Several UC design features, and its changes to benefit generosity, can lead to claimants struggling to afford rent payments. This article uses fixed-effects panel modelling to investigate UC’s housing insecurity impacts within English local authorities (2014 Q1 - 2019 Q1) by bringing together official UC data and Citizens Advice ‘advice trends’ data on rent arrears/homelessness issues within the social/private rented sectors. The results suggest UC rollout is associated with increases in rent arrears advice issues (though not homelessness advice issues). This impact tended to be greater when UC had been rolled out for longer (and therefore reached more claimants), and was greatest in the social rented sector where people are more vulnerable to arrears. This highlights a need to increase the level of UC payments and address its long wait periods and harsh sanctions.

Capturing the neglected extremes of UK poverty: a composite modelling approach to destitution and food bank usage

“…A number of limitations of this work may be identified. The analysis is essentially cross-sectional and observational in nature, and caution is needed in drawing strong conclusions on causality, although some of the strong relationships observed (for example with Universal Credit) are both suggestive and consistent with other types of evidence (Sosenko et al, 2019;Fitzpatrick et al, 2020;Bramley et al, 2021;Hardie, 2022). Not all variables can be precisely replicated between the two surveys, and this is particularly an issue with destitution itself.…”

“…The strongest individual variable effects, based on odds ratios 7 , are being a home owner and having other living relatives (negative, or protective effects), and applying for and/or receiving Universal Credit (positive, OR=3.34). The latter ties in with qualitative evidence from the study which indicated that, in this particular time period, the roll-out of this new form of income-related working age benefit was particularly problematic, owing to its 'on-line only' application process, five-week wait for payment and debt deduction from payments (Fitzpatrick et al, 2020;Hardie, 2022). By contrast, lost benefit income and lost job had more moderate effects, alongside the effect of actually having work in reducing risk substantially (OR= 0.39).…”

“…Alongside a general 'freeze' in the levels of working-age benefits, myriad social security cutsbenefit caps, local housing allowance restrictions, limits on family benefits, and narrowing eligibility for sickness and disability support -have placed increasing financial pressure on low-income households (Cribb et al, 2017;Portes and Reed, 2017). The rollout of Universal Credit (UC), particularly with its 'five-week wait' and debt deduction characteristics, appeared especially problematic (Corlett et al, 2022;Vizard and Hills, 2021;Hardie, 2022), while national and local emergency welfare assistance schemes have been eroded, especially in England (National Audit Office, 2016;Gibbons, 2017). There were also rising concerns about 'in-work poverty', especially that associated with highly insecure and marginal forms of work such as 'zero-hours' contracts (Bailey, 2018).…”

A thematic analysis of homelessness practitioners’ perception of the impacts of welfare reforms in the UK: “Hard to maintain my own mental equilibrium”

“…Some participants reported their experience as intimidating, dehumanising and disempowering. Moreover, some had many arrears (utilities, rent) and had experienced eviction threats, while other social tenants with fixed-term, conditional forms of tenancy who were unaware of the possible delays to accessing UC reported that these had caused them much anxiety and repossession (Dwyer and Bright, 2016, 2020; Hardie, 2021, 2022). Wickham et al (2020) reported that the introduction of UC led to an increase in psychological distress, a measure of mental health difficulties, among those affected by the policy.…”

The impact of universal credit rollout on homelessness assistance need in Scottish local authorities

“…Meanwhile, academic research using qualitative research methods have provided evidence of some claimants experiencing rent arrears and risk of eviction as a result of UC's long wait periods, sanctions and monthly direct payment system (Batty, 2018; Britain Thinks, 2018; Cheetham et al, 2018; Cheetham et al, 2019; Robertson et al, 2020; Wright & Dwyer, 2020; Wright et al, 2018). Likewise, quantitative research has provided evidence that UC rollout, so far, has been associated with increases in rates of rent arrears (Hardie, 2022; Hunter, 2020; National Audit Office, 2018; Smith Institute, 2017, 2019) and landlord repossession actions (Hardie, 2021).…”