‘People are living lives of desperation’ – Salford suffering under Universal Credit says Deputy Mayor

The roll-out of Universal Credit is plunging Salford families into debt, according to the Deputy Mayor and Salford’s Credit Union.

Cllr John Merry says the problems are “very severe” and likely to get worse despite claims in the Autumn Budget of an end to austerity.

Cllr Merry said: “People are living lives of desperation in many cases at the moment, and unfortunately many people have met that through borrowing money.

“The whole system is failing the people of Salford.”

New system, big problems

Universal Credit, which launched in Salford over the summer, overhauls the benefits system, merging six different benefit and tax credits into one, for both the employed and unemployed alike.

Chancellor Philip Hammond’s Autumn Budget did make some concessions by slowing to the national launch of Universal Credit until December, rather than the intended November launch, along with increased spending and a revised implementation schedule.

Cllr Merry said: “The system has been very badly designed, and he has actually acknowledged that in terms of trying to make changes to the system, but people have run up masses and masses of debt as a result of it.”

Nearly two-thirds of Salford residents on Universal Credit (62.6 per cent) are currently unemployed out of a total of 3,511 Salford residents signed up for the system as of September 2018.

Statistics provided by Salford City Council

Universally worse off

Salford Credit Union, which provides “safe, competitive and fair financial services” to the people of Salford, often must tackle the issues of personal debt and Universal Credit.

Deputy CEO Mark Brazendale said: “I would say that there is a severe debt problem in Salford.

“The poor are getting poorer primarily due to a reduction in benefits. The introduction of Universal Credit, which is now being rolled out across Salford, is on average meaning a reduction of around £50 per week on the average family income.

“Many of our residents are financially excluded due to previous issues with debt which has meant that loan sharks are becoming increasingly popular in our city as a means to acquiring goods.”

Universal Credit, which launched in Salford over the summer, overhauls the benefits system, merging six different benefit and tax credits into one, for both the employed and unemployed alike.

The continual rise in poverty, insecure work and the crisis of low pay brought on by this callous government pursuing austerity relentlessly is seeing shockingly high numbers of people in desperate straits attempt to take their own lives. https://t.co/JFoG5o0nMd

— Barbara Keeley (@KeeleyMP) December 3, 2018

Cllr Merry said: “Supposedly austerity is over but if you read the Chancellor’s speech you would be forgiven for thinking it was well and truly with us still.

“In terms of local government, he’s done very little for us. I wasn’t impressed with the Autumn Budget, I think it was very much a case of lots of flashing lights, but nothing actually of substance underneath it.”

The Budget did introduce zero-interest loan schemes and an increased “breathing space” in which those in debt can seek advice, however.

The number of individual bankruptcies is the highest they have been since 2012 nearing a total of 30,000 individual Insolvencies as of June 2018, according to Government Insolvency Statistics.