No benefits 'safety net', says DWP

Feb 6 2013

Part-time workers in jobs that do not pay enough to even cover their travelling expenses face losing their benefits if they quit, UK employment chiefs have confirmed.

Some people are effectively working for nothing because the benefits system does not provide a "safety net" if they voluntarily give up an unsustainable job, MSPs have heard. Unpaid work experience or training are amongst the only alternatives on offer at the Jobcentre for low-paid underemployed workers, MSPs were also told.

Officials from the Department for Work and Pensions (DWP) told a committee the new Universal Credit (UC), which will replace jobseeker's allowance and tax credits from April, may alleviate the problem of underemployment.

Jobcentre staff will be tasked with helping underemployed people, as well as unemployed people, for the first time as HM Revenue & Customs will no longer administer tax credits, making the DWP the lead department for employment and benefits.

However, the DWP officials told Holyrood's Economy, Energy and Tourism Committee they have little evidence to support their belief that UC will help alleviate underemployment.

Labour MSP Rhoda Grant said: "There are a lot of people whose hours have been cut and who are trapped in underemployment, not because they set out to be underemployed but because their employers are cutting hours and trying to keep people on the books.

"It comes to a point where they are not qualifying for any benefits, but their hours are not enough to sustain them in any way. They are then in poverty. Where is the answer for those people who are trapped in this horrendous situation?"

DWP work services director for Scotland Richard Cornish said: "I don't think this is the answer you might want, but from the Jobcentre Plus perspective we would do everything we can to help them find work."

Ms Grant said: "But there's no safety net for those people?"

Mr Cornish continued: "On the face of it, we would look to find support for more hours for other jobs, but under the current system, until UC comes in, then that case is as you present it."