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Written evidence to the Work and Pensions Select Committee inquiry into the welfare safety net

The House of Commons Work and Pensions committee is holding an inquiry into the effectiveness of the welfare safety net.

We have submitted evidence to the inquiry and highlighted that:

  • A significant proportion of our clients don't have enough money to meet basic living costs. There's no one cause of debt problems among our clients: common risk factors include income shocks (most often linked to employment and earnings), having insufficient income to meet living costs, and the use of credit products that can compound financial difficulties.
  • Debts to local government have increased following localisation of council tax support. Public sector debt collection practices are frequently worse than those in the consumer credit sector and contribute to financial hardship. The introduction of a statutory breathing space scheme is a welcome step; however, national and local government must do more to bring their wider approach to debt collection in line with best practice.
  • Reducing experiences of hardship rests foremost on ensuring that income is adequate to meet reasonable needs and that the design of the social security system does not itself contribute to hardship. At present, achieving both aims would require a fundamental change in government policy, including a review of the adequacy and design of Universal Credit.
  • In the short-term, the government can increase the effectiveness of the safety net by introducing more flexible advances within Universal Credit and legacy benefits, introducing statutory guidance supported by sufficient funding for local welfare schemes and creating alternative options for people who cannot afford to repay loans.

Download our response to read our full written evidence.

Download our inquiry response