In a new report, we estimate that in July/August 2020, about half a million people were eligible for Universal Credit (UC) but didn’t claim it. While the headlines are all about the numbers involved, I here want to deal directly with the argument that we don’t need to worry about non-take-up. Not only does it matter, but it’s also something where different policies can make a difference.
Is non-take-up a problem?
It is sometimes said that non-take-up is not a problem, because the people that really need benefits claim them. According to this view, non-take-up improves the efficiency of the system by focusing benefits on those most in need – as the right-wing US commentator Charles Murray put it, “stigma makes generosity feasible.” However, there’s at least two things wrong with this claim.
Firstly, our report shows that people not taking up UC often were in need. More than half reported severe financial strain (either falling behind on bills/housing costs or not being able to afford fresh fruit and vegetables daily). One-in-six had not eaten when hungry in the past two weeks because they couldn’t afford it. While these levels of strain are not quite as severe as those claiming benefits, they are much, much higher than among the rest of the general public. It is often not lack of need that explains non-take-up, but instead things like perceived stigma and ‘hassle’, the hope that things will soon get better, or a lack of understanding that they might be eligible.
Some of the non-claimants in our survey may have later claimed UC – as we showed in a previous report, 10-25% of claimants delay a month or more before claiming. Yet because of the design of UC, these people then have the choice of waiting a further five weeks before receiving any money, or claiming an advance payment which means that their (already not generous) benefit payments are reduced further to pay it back over the next 1-2 years. Claiming sooner is better, as the DWP themselves have emphasised (e.g. the DWP Minister Will Quince recently said delays are ‘one of the biggest problems that we find’).
More than this, though, there is something wrong with a system if large numbers of people do not claim benefits they are entitled to. The state should not only provide a safety not on paper; it should try to make sure that people get the benefits that they are eligible to receive, which may reflect years of paying National Insurance contributions. Non-take-up of contributory benefits – ‘new style’ JSA/ESA – is therefore a problem too (and one which we review in our report). Indeed, there are good reasons to make our system less focused on means-testing, as I’m going to argue in upcoming blog posts on Inequalities.
Can we do anything about non-take-up?
Some people may concede that non-take-up is a problem – but feel that there’s nothing that anyone can do about it. Benefits stigma, for example, has been around for as long as benefits have existed. Most people will not carry around a detailed knowledge of the eligibility criteria for benefits in their heads. And the fact that we find non-take-up during COVID-19 – a time when newspapers, politicians and employers were urging people to claim benefits, and when many people will have known others claiming – is striking.
Nevertheless, non-take-up can be affected by policy. For example, if people start applying for the wrong benefit, the system does not direct them to the right one. This seems likely to have happened for people ineligible for UC who should have applied for contributory JSA/ESA. (And also the reverse – one of the qualitative interviews I did in the project was with someone who initially applied to JSA, was rejected, and only applied for UC when their mum told them that’s what they should have applied to in the first place). A single benefits application portal would therefore help, as would more useful rejection letters.
Even benefits stigma can be changed by policy, such as treating claimants with dignity and speaking respectfully about them. Things have certainly improved since the early 2010s, when there were a large spike in negative reporting about benefits and a large spike in benefits sanctions, both linked to the Cameron/Osborne welfare reform agenda. These improvements were particularly marked during the pandemic, when the language around benefits was transformed, and sanctioning virtually ceased. Yet fears about both still lingered in some people’s minds, and reducing non-take-up further will take years of improved language and treatment.
Finally, the DWP has an admirable track record internationally for transparently estimating non-take-up – but this is something they seem to have abandoned with the introduction of UC. Non-take-up is therefore becoming an invisible problem once more. We should strive to maximise people’s take-up of their entitlements, and to do this, it is essential to make non-take-up visible, and to produce a clear take-up strategy to try to tackle it.