Don’t write off universal credit yet – it can still be a success story

Samuel Prosser

March 7, 2019

On its current trajectory, universal credit is poised to become the next political buzzword for bungled government incompetence; an overly-ambitious and shallow policy with little actual thought put into its implementation, plagued by problem after problem and promptly left to fall by the wayside when it becomes too politically toxic.

From a completely inadequate IT system used by the Department for Work and Pensions to a crudely implemented six-week waiting period leaving many claimants without proper support, universal credit has had more than its fair share of well-documented embarrassments.

It is a shame, as the policy is, in theory at least, a solid idea that could form one of the cornerstones of Conservative domestic policy post-Brexit. At the time of its initial conception in 2010 by then work and pensions secretary Iain Duncan Smith, the proposal was well received.

Streamlining different welfare support payments into one single care package which encourages people to enter the workforce and become self-sufficient is a smart and sensible principle. But its utility in practice has been far less promising. Instead of simplifying the welfare process and making it easier for all parties involved, universal credit has succeeded only in achieving the opposite. A lack of proper infrastructure supporting the new system has meant it was hindered in its effectiveness from the very start of its rollout.

In its review of the progress of the policy so far, the National Audit Office stated that the project had been “driven by an ambitious timescale” and had suffered from “weak management, ineffective control and poor governance”. In its rush to push the policy out into full use, the government lost sight of actually ensuring the project could cope with trying to bring eight million households off the old system of segregated payments onto one unified one.

As well as this, the effective six-week drop off in support for claimants moving from six payments to one has been a major cause of controversy. Naturally, those transitioning to the new system have felt undercut by the government for being left without support as their income is assessed and their claim is processed, despite already receiving support from the old system.

The government had clearly recognised the potential issue that this gap in payments could pose and attempted to alleviate it with the option of advance payments for claimants to pay back later. However, for those with significant rent arrears or who would end up burdened with them while waiting for payments, a restricted advance upfront means little for their situation and leaves them under pressure from the very start of receiving their new payments.

Despite this, some of the criticisms levelled at universal credit have been unfair. It is hard to justify the criticisms of the DWP for simplifying the administrative work by moving the process largely online, affecting a small minority of claimants who do not have online literacy or direct internet access at home, as it makes the process much more accessible and easier for both the government and the vast majority of claimants.

As well as this, some have criticised the move to end many direct payments of rent and council tax that were covered under previous benefits and give those responsibilities to claimants themselves. While this should not be put on those unable to handle the payments themselves, for everyone else it is a necessary move to prepare them for fully entering work and budgeting for themselves. Employers won’t handle paying their employees’ landlords and covering their council tax bills, so the government should not be expected to do that either.

But there is now a serious temptation on the part of the Conservatives to overcompensate for this debacle, abandoning the path of much-needed welfare reform and embarking on a Butskellism-style splurge on welfare spending, in an attempt to match Labour’s rhetoric. The Tories tried this move at the 2017 election and it failed spectacularly, and there is a significant possibility the same folly could be repeated again.

Welfare should, as the Conservatives have been fond of saying, act as a “hand up”, not a “hand out”. The government is there to support people in times of need and encourage them to be financially independent, not to oversee their continued dependence on the state to provide for their every need.

With the deadline for universal credit’s full rollout being pushed back further and further, it is unclear whether the government is providing the time and breathing space needed to properly rework its core domestic policy, or if it is simply kicking the can down the road for another time.

Either way, the foundation for a solid welfare policy has already been laid out in front of them. What’s required now is a serious rethink of how to properly utilise it in practice.


Written by Samuel Prosser

Samuel Prosser


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