As Universal Credit extends its icy grip, the tone of press coverage has been changing; it is more focused on personal experiences, and it is ever more serious. These are from the last few days; the headlines speak for themselves.
There are a couple of days left to comment on the draft Scottish Social Security Charter, but I’m not going to do that, for a simple reason: it’s excellent, and I have no criticism to make. I’m going to pick out just five points:
- the Charter promises that the agency will listen to people and to trust them. There is long-standing evidence that threatening people with prosecution during the process of claiming is simply destructive.
- the Charter promises that the agency will learn from its mistakes. I commented during the passage of the Bill that while the UK system treats complaints, rectification and review as a quasi-judicial, adversarial process, “other public services attempt to learn from complaints and use them as feedback to improve their processes.” They’re on it.
- Payments will continue while people are appealing a decision. In the UK system, penalties are routinely imposed without a hearing.
- People will be told about their entitlements, including services delivered by other agencies.
- People will not have their time wasted. They promise to “recognise that your time is precious and handle your application and enquiries as quickly as we can.”
This may be a challenge, but can anyone spot the difference between this and the DWP?
Personal Independence Payment has proved to be more costly than the system it replaced. If only we had realised, the Office for Budget Responsibility complains, we shouldn’t have accepted that PIP would deliver the savings that the DWP was predicting.
“At the time of its use in our December 2012 forecast, the results from [the DWP survey] appeared the best available guide to the assessment process. But hindsight has revealed several issues with the nature and use of the results … including: the voluntary nature of participation; the hypothetical nature of the assessment; subsequent changes to assessment criteria; and a sample that was unlikely to be representative of new PIP claims. It is now clear that the results were biased rather than merely uncertain.”
Among the excuses, the OBR notes that the forecasts are subject to changes in the composition of the peopopulation which is making claims, legal challenges about the scope of the benefit, and changes in the way that benefits are delivered.
Oh, my: who’d have thought it? Well, as it happens, I did. I wrote in this blog on 15th December 2012:
I think the predictions are likely to be wrong. The common experience of selective benefits has been that when governments try to impose firmer boundaries, they are liable to discover that needs are deeper, more complex and more difficult to reject than they imagine. The distinction between the lower and middle care rates on DLA has always been confusing, and many people can argue persuasively for higher banding. There are new opportunities to include people with psychiatric disorders. And the PIP rules do not exclude the growing numbers of older people claiming DLA. Short term reductions have to be offset against the general trend, and as time goes on, inexorably, there will be pressure to extend protection. That happened with Single Payments, it happened with Incapacity Benefit, it has happened with DLA, and it will probably happen here, too.
The High Court judgment on Universal Credit payments has implications beyond the immediate issues. It condemns the DWP for simply following through an automated process for income testing rather than considering the actual circumstances of the claimants – in this case, the early payment of monthly salary.
When the idea of making assessments in ‘real time’ was first mooted, in 2010, I was critical of the idea. In the course of the last eight years – yes, it’s that long – I’ve posted a range of comments about the effect of assessing income on the basis of the current month. I’ve just been reading through my old posts to make a list:
- it deals with uncertain information
- it requires the system to process information that it doesn’t have access to
- it deals with information from diffuse sources
- it’s not applicable to the circumstances of self-employed people
- it puts claimants into default when things go wrong
- the system can’t cope with irregularities in the calendar, like bank holidays or Februaries
- it provides an income that is fluctuating, unstable and unpredictable.
To this, we can now add another point: mechanical calculation yields arbitrary and unreasonable results.
Surely, people in favour of means-testing might reasonably ask, there’s no real difference in principle between monthly assessment and the assessments we used to have? That may be true. Many of the problems we’re seeing are problems that we’ve known about for years. They include:
- the problem of offering fluctuating incomes to people on very low incomes – a system, the Ombudsman commented about Tax Credits, fundamentally unsuited to the needs of low income families
- the problems caused by tapers, which mean that people can’t tell when they’re entitled to benefits and when they aren’t
- the problems posed by changes of circumstances, and
- the devasting effect when changing entitlement to one benefit (such as Income Support) spills over into suspension or recalculaltion of another (such as Housing Benefit) .
Universal Credit, I’ve previously written, “brings together every major feature that has caused administrative meltdown in the course of the last forty years … It is as if the designers had painstakingly identified all of the elements of the benefit system that are known not to work and built the new benefit around them.”
A couple of recent announcements suggest that planning Universal Credit has been subject to a “rethink“. The actual changes amount to something less than that. There is a delay in the rollout, which will affect those people currently being transferred from existing legacy benefits. The largest group of people affected by the decision are those who are currently on Employment and Support Allowance, because that is the largest group of people of working age who receive benefits for longer periods. Most people who were unemployed and in receipt of JSA have already been transferred, and anyone who signs off benefits and then needs to make a claim will have to claim through the Universal Credit. Amber Rudd has said that even with the ‘pause’, the numbers of people receiving Universal Credit is expected to grow to three million in the normal course of events – more than double the existing figure.
The other major change has been the revision to the two-child policy, which limits support to the first two children. That does not mean that two children will get fed when the third doesn’t; it means that every child in a larger family gets less support, and that is why the policy is exepcted to have such a large effect on child poverty. The change is confined to children born before April 2017, which is why it will only benefit 15,000 families.
The treatment of Universal ‘Credit in the press has become increasingly critical, but I’m not sure that most have yet appreciated just how deep the hole is. It doesn’t help that benefits are paid monthly, that it expects people to be online, or that strict and lengthy penalties are being applied for non-compliance, and the idea that people with no other income can have their benefits stopped for 5 weeks or more is simply outrageous. Any of those could be stopped in short order. That would still leave us with all the other problems with the scheme. MPs are well aware of those problems – their constituency surgeries are inundated with them. The government is trying to offer enough tweaks to defuse the discontent. It will take more than a few tweaks.
Brexit has used up all the oxygen of political debate. There are few proposed changes in policy for real life, but it’s important to realise that while all this has been going on politically, Universal Credit has been rolling out. David Webster’s invaluable briefings on sanctions also tell us a lot about the process.
- 1.3 million people are now on Universal Credit. (The November figures make that more than 1.4m.) With more than 100,000 new recipients each month, the numbers are increasing rapidly – even if it will still take four or five more years at that rate to reach the target figures.
- 580,000 of the UC claimants are unemployed. 339,000 unemployed claimants are still in receipt of JSA. That means that UC is now the main source of support for unemployed people.
- 190,000 UC claimants are working.
That leaves 530,000 others to account for. Most benefits for people of working age are there, not for unemployed people, but other people of working age. As the numbers receiving UC continue to grow, that must mean that progressively higher proportions of people who are sick, or otherwise out of the labour market, will be receiving UC instead. But the whole focus of UC, such as the requirement for people to form a claimant agreement with ‘work coaches’, is on the very small minority of people who are unemployed and unlikely to find work in their own right. That can only mean that problems of UC get worse.
I went today to a seminar for early career researchers, most of whom are working on issues related to social security. That is, of course, a terrible idea; I spent most of my career trying to interest people in social security issues, and look what happened to me.
Adrian Sinfield, who reflected about the changing situation in Scotland, gave one of the presentations, He was very kind about a book I wrote more than 25 years ago, Poverty and Social Security: concepts and principles. However, as I’ve explained to Adrian, I’ve had some reason to think again about that book, and I wonder if I didn’t make a strategic error in writing it. If we want a social security that treats people with respect and dignity, it’s important that people should see it as a part of everyday life, not as provision for the poor, or even a safety net for exceptional circumstances. It’s not necessarily a good idea either to focus a discussion of social security on its effects on poverty, or conversely to identify poverty with the receipt of social security benefits. The discourse has shifted since, and discussions of social security tend to be hijacked by discussions of employment; that is even less appropriate.
The new figures for takeup of means-tested benefits show an interesting trend. Takeup is falling, and the initial impression given is that there has been a slow, marginal fall in in takeup overall. However, the fall is not the same across the board. The takeup that has most clearly fallen relates to the housing costs of private tenants. It seems unlikely that this is driven by increasing ignorance about benefits, and that tends to suggest that something is happening in the private rented market – most likely, that landlords are restricting access for claimants.
The House of Commons Work and Pensions Committee has reported critically on the sanctions regime. The Committee recommends that
- sanctions should stop for people who do not have capacity for work
- there should not be in-work sanctions on UC until the system is fully operational
- deductions should not be more than the benefit
- there should be clear rules about what is a good reason for non-compliance
- there should be warnings before the first sanction, and
- families with young children should not have more than 20% of benefit deducted.
They accept that “Sanctions must be a last resort and claimants should be able to challenge the decision before it is imposed.” That alone would make a marked difference to current practice.
This could have gone further. The DWP has no evidence about the effects of sanctions in most cases, and the Committee asks them to get some. That looks like a recipe for delay, because there’s no shortage of other evidence. Looking over the recommendations, the Committee clearly sees no good reason to sanction people who have no prospect or reason to go to work instead – and that is the vast majority of people who depend on ‘working age’ benefits.
Additional note, 24th November: Michael Adler has posted a detailed summary and critique of the Committee’s report.
The main story in the Budget is about Universal Credit, but the measures taken fall rather short of what would be needed to save the benefit. The Work Allowances are increased for some, but not for people without children – a high proportion of current claimants, because they went on the system first – and one of the main effects of cutting the Work Allowance has been that they have little reason to remain in contact with the scheme as income fluctuates. Most of the administrative problems are untouched, and a slightly slower rollout (still continuing, but slowing by a few months) is not going to make much difference to them.
The other part of the Great Plan, which is less noticeable, is a declaration of the intention to continue with the abolition of Housing Benefit by moving to a Housing Credit within the Pension Credit system. This provision was set up rather a long time ago, in 2011 – I have to admit I’d forgotten about it – and it will take a long time, now planned for late 2023, to be fully implemented. At the time the government suggested, bizarrely, that combining Housing Benefit into Pension Credit should improve takeup. It will probably have the opposite effect. Housing Benefit is more effectively accessed than PC; that’s probably true because social landlords steer their tenants towards an application, and they won’t be able to do the same with Pension Credit.
There’s another issue besides. We’ve seen in Universal Credit that the effect of transferring Housing Benefit back to the DWP has been to create confusion: DWP officers don’t necessarily know about housing (for example, what a tenancy is) or what they need to do. (We had the same problem in reverse when the DHSS initially transferred responsibility for rent to local authorities in 1982.) Killing off Housing Benefit will also finally kill off the expertise of local departments that learned the hard way how to make the system operate despite its arcane rules.