UC claimant are likely to be in work

Analysis of nearly 6,000 claimants over the first four months of their universal credit claim shows a percentage point difference of between 3% and 4% in the proportion of universal credit claimants in work compared to those claiming jobseeker’s allowance (JSA).

The Department for Work and Pensions report was published as the government launched the next phase of universal credit, which it calls a ‘national roll out’. Universal credit combines a number of benefits into one payment made direct to households.

The analysis found that universal credit claimants spent on average four days more in work and earned on average £50 more during the first four months, looking at ‘matched’ claimants with similar age and employment histories.

However the report states that ‘additional discussion and supplementary analysis’ is necessary to clarify whether it is universal credit as a system that is responsible for the improvements.

The report also notes some important factors may have influenced the results, such as certain groups which may have a lower rate of employment being excluded from universal credit, including pregnant women and people without a bank account.

Another potential bias is that JSA claims are processed faster, meaning ‘for two identical claims (one JSA and one UC), it will appear that the JSA claimant took a longer time to find work than the UC claimant’ as, after 5 days, 64% of JSA claims are processed as compared to 57% of UC claims.

The report describes the analysis as a ‘best attempt’ given the available data at this early stage.

Work and pensions secretary Iain Duncan Smith said: ‘The evidence today shows that under universal credit, people move into work more quickly and earn more money, giving them increased financialsecurity.

‘This is a cultural change which will alter the landscape of work for a generation.’

There will be a phased rollout of universal credit from today, starting with more areas in the north west of England and spreading gradually to include all job centres. The DWP expects the majority of claimants to be claiming universal credit by 2017.

Universal credit rollout began in October 2013, starting with Hammersmith Jobcentre, followed by Rugby, Inverness, Harrogate, Bath and Shotton by Spring 2014. The benefit was introduced to pathfinder areas in the north west, initially for single people and then extended to couples in July 2014 and to families with children in November 2014.