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Legal threat over Universal Credit scheme

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The LGA has threatened to take the Department for Work & Pensions to court if councils are forced to make benefits staff redundant because of the switch to Universal Credit.

The sector body’s chief executive, Carolyn Downs, told the LGA’s executive meeting on Thursday that it had negotiated with the DWP for six months about whether 20,000 local authority benefits staff would be transferred to central government under Tupe conditions. Should the DWP decide Tupe does not apply, councils will face large redundancy bills.

“We have left [the DWP] in no doubt whatsoever that we will mount a legal challenge if they make a decision that Tupe doesn’t apply”, Ms Downs said, adding that she had been told the department had not yet decided what would happen to the staff.

Peter Fleming (Con), leader of Sevenoaks DC, stressed that councils “cannot afford the costs of [benefits staff] not being transferred under Tupe.”  

At the meeting Gerald Vernon-Jackson (Lib Dem), leader of Portsmouth city council, said he was worried that an increase in arrears when the Universal Credit system came in would “crucify our finances”.

“I’m told that in the Southwark pilot, arrears increased from 1-3% to 11-12% because people made sensible decisions that it’s best to pay off their payday loan or credit card as opposed to the council. Now that’s going to crucify our finances.

“It seems to me this is going to be an enormous issue that we need to take up at the highest level”, he said.

Gary Porter (Con), leader of South Holland DC and LGA vice chair, said at the meeting: “ I don’t think anybody can fault the government’s aspiration that people should be accountable for their own money and budgeting, and [we should] treat people like adults as opposed to small children.

“But the evidence is already there that some people are worse than small children. The impact that will have on the rest of our client base, if that’s what we call them, is going to be huge.”

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