Universal credit: New sanctions threat sparks fears of poverty and debt after four weeks

A government crackdown putting thousands of universal credit claimants at risk of widely-condemned payment cuts comes into force today, February 8.

The Department for Work and Pensions (DWP) scheme is reducing the time a person has to find a job which suits their experience from three months to one, at which point they could be sanctioned and pushed deeper into hardship.

If, after four weeks from making their initial claim, they cannot prove they are making “reasonable efforts” to find a job in any sector, or if they are found to have turned down a job offer, they could be handed sanctions which experts have linked to rent arrears and increased food bank use.

The so-called Way to Work scheme will only target those deemed able to work by the DWP, but disabled people have warned this can mean claimants face a choice of being pressured to find work which affects their health or risk being pushed into poverty by sanctions.

“Claimants will not even have received their first universal credit payment and employers will scarcely have had time to complete the recruitment process [before sanctions could be handed out],” said David Webster, honorary senior research fellow in social and political sciences at the University of Glasgow. “The main effect may well be to deter workers with significant skills or experience from claiming benefit at all.

“This is before we even consider the damaging effects on claimants who actually experience sanctions,” he added. “Physical and mental ill health, hunger, homelessness, debt and survival crime, have all been extensively documented consequences.”

Analysts at the university found that sanctions were linked to increased poverty, poorer health outcomes and a downward trend in child wellbeing.

“It is obvious that neither employers nor consumers will be happy with this,” Webster said. “Neither want workers whose heart is not in the job, and employers don’t want to waste time looking at unsuitable applicants.”

Unemployed universal credit claimants are often subject to a “claimant agreement”, meaning they are expected to look for work for a certain number of hours each week – and prove it – if job coaches believe they are able. DWP staff sometimes reduce the amount of work a claimant is expected to find, or remove the job search condition from their claim entirely, if they have health issues or are disabled.

But claimants with health problems told The Big Issue that this can still sometimes mean working jobs which exacerbate their conditions, or being pressured by the DWP to find more work even if the part-time roles they already hold are causing them physical pain. 

“If you are offered a job and you turn it down, even though it’s a job you’re perfectly capable of doing, we are going to be saying a lot more that we don’t think that’s appropriate,” Work and Pensions Secretary Thérèse Coffey said.

“You’re receiving taxpayers’ money week in, week out to look for work, there’s a job there that you are perfectly capable of doing and we will continue to support you.

“If you choose not to get work then why should you get paid? It’s quite possible you’d be referred for sanction and as a consequence part of your benefits would be suspended.”

The government said the scheme will help 500,000 people into work by the end of June, and is particularly keen to help people into supply chain jobs plus sectors including social care and construction.

Around 40 per cent of people claiming universal credit are already in work. Research published by the Trades Union Congress showed the number of workers relying on the benefit has more than doubled to 2.3 million since before the pandemic.