PARLIAMENTARY DEBATE
Covid-19: Universal Credit Applications - 29 June 2020 (Commons/Commons Chamber)

Since mid-March, we have processed about 3.2 million individual universal credit claims. Despite that surge, the system is standing up to the challenge and demonstrating the resilience and scalability that is a fundamental part of its design. From the peak of claims made, fewer than 1% of claimants have outstanding verification preventing payment. There is no way that the legacy benefit system could have coped with such pressure.

Citizens Advice found recently that more than half the people claiming universal credit for the first time during the crisis had experienced hardship and that many did not want to take out a loan because they were afraid of taking on more debt. A system where more than half of people are experiencing hardship is surely a system that is not working, so will the Minister reconsider proposals to end the five-week wait and replace loans with a cash grant?

I do not recognise the picture the hon. Gentleman paints. Universal credit advances are available for those who need them. They are interest free for 12 months and as of next year that will increase to 24 months. We get support to people as quickly as they need it. That is why the payment advance is available, usually within a couple of days.

When the job retention scheme is wound down, we will see, I am sure, a second wave of universal credit applications, on top of the 70% increase we have already seen in Hull. With unemployment in Hull forecast to get to about 16%, is it not time now to prepare to remove the five-week wait for universal credit and to make the £20 increase a permanent feature?

The Department has processed an unprecedented number of claims during this period. We have put over £6.5 billion into our welfare system to support those who need it quickly. As for what the hon. Lady defines as the five-week wait, nobody has to wait five weeks for a payment. An advance is available, usually within a couple of days, for those who need it.

Any job loss is regrettable, and the Department stands ready to support people who find themselves in that position. The £6.5 billion package included an increase in universal credit of over £1,000, a similar increase in the standard allowance for tax credits and an increase in the local housing allowance. That is over and above measures such as the job retention scheme, the self-employment income support scheme, the £500 million hardship fund via local councils and the £63 million local welfare assistance fund. As the Chancellor said, we will do whatever it takes to support people through covid-19.