Alex Clegg, Deven Ghelani, Zoe Charlesworth, Tylor-Maria Johnson
Policy in Practice finds that the total amount of unclaimed income related benefits and social tariffs is now £18.7 billion a year
Maximising income through the take up of benefits is essential to support households during the cost of living crisis and prevent further financial crises. Designing an effective safety net that supports struggling families demands an accurate understanding of the level of unclaimed benefits and who is not claiming.
A new robust estimate of unclaimed support
The lack of official and up to date data means that estimates tend to rely on experimental methodologies and figures that are sometimes years old. The methodology employed for estimates provided in this paper is calculated from claim and award data where feasible.
- We estimate that £7.5 billion of Universal Credit goes unclaimed by 1.2 million eligible households. Caseload take up varies between 70% and 90% for national means tested benefits
- Take up is lower for locally administered benefits. Council Tax Support is the most underclaimed, with 2.7 million people missing out on £2.8 billion of support
- Social tariffs are also significantly underclaimed. Broadband social tariffs have the lowest take up, with 97% of eligible households missing out on the tariffs. People on means tested benefits should check for eligibility with their utility providers.
Why are benefits underclaimed?
Benefits go unclaimed due to administrative complexity, a lack of awareness, stigma, and the increasingly fragmented nature of support.
- Administrative complexity: The sheer complexity of multiple application mechanisms, administering organisations, eligibility criteria and conditionality creates a barrier for many people who are trying to navigate the system and access support
- A lack of awareness: Many claimants are simply unaware that they can claim support given their circumstances or income
- Stigma: Negative perceptions around claiming benefits may discourage eligible people from engaging in the benefit system
- Increasing fragmentation of support: Inadequacy of means tested benefits is driving a growing plethora of discretionary and other support schemes. This creates postcode lotteries for available support and unequal conditions to access it.
Recommendations for policymakers
- Address the insufficiency of core social security benefits: Inadequate benefit levels contribute to an ever-increasing web of support, used to fill the gaps in the mainstream system. Making sure benefits cover the essential needs of a household is crucial.
- Reduce complexity and increase awareness of local and national benefits: The DWP should be made responsible for increasing take-up of support. Data sharing can streamline access to support and raise awareness of benefits at all points of contact with the household.
- Change the messaging around benefits: Government messaging is critical to ensuring that all those that are eligible access support. We urge the government to adopt a supportive approach towards claimants by lessening conditionality.
Recommendations for practitioners
People need to be protected from the rising cost of living. People can check their eligibility for benefits using one of the benefit entitlement checkers on GOV.UK including Better Off Calculator. Companies should also check for eligibility on behalf of their customers.
Local authorities can use the Low Income Family Tracker analytics platform to launch benefit take up campaigns. Data analytics can be used to proactively identify residents in need and contact them about the benefits they are missing out on.