Complex benefits system is a barrier to reducing poverty in Wales
An inquiry held by the National Assembly for Wales’ Equality, Local Government and Communities Committee has learnt how the benefits system is failing some people on the lowest incomes and is causing wider problems for our communities - in areas from mental health, to local government to poverty.
- Wales has the highest poverty levels in the UK and allowing more Welsh powers over benefits, alongside the increased powers around tax, could help reduce poverty.
- The benefit system is too complex and does not treat people with dignity, fairness and compassion.
The UK Government’s programme of welfare reform is one of the most important political issues to affect Wales since devolution. By 2023, one third of Welsh households will receive Universal Credit, and the Committee heard particular concerns that long waits for the first payment and monthly, rather than fortnightly, payments were causing numerous problems.
The Committee’s report – Benefits in Wales: Options for a better delivery - contains 17 recommendations for Welsh Government. These include changes within the current devolution settlement, as well as exploring the devolution of housing-related benefits and the assessment process for disability and sickness benefits.
Included in the Committee’s report are recommendations to address these issues. They call for the Welsh Government to ensure that Discretionary Assistance Fund (DAF) payments are made available as an immediate action. DAF payments are non-repayable emergency grants for people on low-income in Wales and could ease the pressure on households as they wait for their Universal Credit payments.
Welsh Government should also seek payment flexibilities, so people can opt for more frequent payments, direct payments to the landlord, or to split payments between couples.
Other recommendations include raising the Free School Meals threshold to £14,000, if feasible, from its current threshold of an annualised net earned income of £7,400 for people claiming Universal Credit.
The complex system is not working at its best and could do more to help people on the lowest incomes, says John Griffiths AM, Chair of the Equality Local Government and Communities Committee;
“The current system is not working for far too many people. We repeatedly hear that benefits are not enough to cover basic and essential household costs, and the system does not treat people with dignity, fairness or compassion. The human cost of these failures is unacceptable, in one of the world’s largest national economies.
“Whilst recommending that Welsh Government explore opportunities to devolve more control of benefits to Wales, our recommendations emphasise what can be done now, within the current settlement, and in the longer term. We believe they set out a clear framework for positive change, which will reduce poverty and inequality at an individual and household level, improve well-being and the economy at a community and national level.
“Almost half of the Welsh population receive some kind of benefit, but the social security system is largely non-devolved. The system plays a vital role in the Welsh economy, for individual households and also the wider Welsh purse.”
The report will now be considered by the Welsh Government.
Read the report: Benefits in Wales: Options for a better delivery