Resolution Foundation

Project summary

An evidence-based assessment of how Universal Credit is coping with the coronavirus pandemic, and how its recipients are coping financially.

Context

Despite the introduction of the Job Retention Scheme and the Self-Employment Income Support Scheme, the coronavirus crisis has led to very large numbers turning to the social security system to prevent catastrophic declines in their incomes. Although Universal Credit (UC) was intended to be the UK’s key safety-net benefit, this is UC’s first experience of an economic crisis.

UC is entirely untested in these sorts of circumstances. Its systems are being exposed to pressures that its designers can never have imagined. And some of the assumptions that underpinned aspects of UC’s design no longer hold. It is therefore vital to evaluate how well UC is coping with the crisis, and how well families are coping with UC.

Project overview

The work will focus on four aspects:

• Reviewing how well, operationally and administratively, DWP’s systems and processes are coping with the unprecedented volumes of claims;
• Greater understanding of the lived experience of UC recipients, and how are they coping with the (sometimes much-reduced) living standards that come with UC;
• Assessing who has gained from the changes to social security announced since the Spring 2020 Budget;
• Assessing how well UC, alongside the Job Retention Scheme and the support for the self-employed, serves as a universal safety net.

The project will use a mixed methods approach:

• analysis of new qualitative research with at least 20 UC recipients;
• analysis of online survey data giving detailed information on the household circumstances of the new recipients of UC, their experience of claiming, and their financial well-being;
• analysis of ONS and DWP statistical releases;
• microsimulation analysis using RF’s Tax-Benefit model, as well as Case Study analysis of example families, to provide an assessment of how well the combination of the social security system, the Job Retention Scheme and the support for the self-employed, serve as an effective safety net, as well as estimating the implications of changes to UC entitlements and generosity.