Category: Social security

This blog includes discussion of issues in British social security policy, along with new material to complement my book, How Social Security Works.

Draft regulations have been published for funeral benefits. We should have a universal benefit instead.

The Scottish Government has published draft regulations relating to ‘Funeral Expense Assistance’.  They are a disappointment; the Government seems to see the purpose as being to replicate, to the greatest extent possible, the existing scheme of funeral payments, and that scheme largely fails in its objectives. Funeral payments fail to reach probably half of the people who should get them.

The core problem is that the benefit is simply too complex.   The draft regulations have these objectives:

3 (2) Regulations 5 and 6 describe eligibility conditions relating to the applicant’s relationship to the
deceased person and multiple applications.
(3) Regulation 7 describes eligibility conditions relating to the applicant’s residence, the last
residence of the deceased person and the place where the funeral takes place.
(4) Regulations 8 and 9 describe eligibility conditions relating to the financial means of the applicant,
based on receipt of income related benefits, and of the estate of the deceased person.

There are too many moving parts for this ever to work.  Look at this regulation:

5.—(1) To qualify for funeral expense assistance the applicant, or the partner of the applicant, must
have accepted responsibility for the expenses of the funeral, and the Scottish Ministers must
consider it to be reasonable for that responsibility to have been accepted.
(2) In determining whether it was reasonable to accept responsibility, the Scottish Ministers must
consider—
(a) whether someone other than the applicant, or the partner of the applicant, would be the
nearest relative of the deceased person in terms of section 65(3) to (6) (arrangements on
death of adult) of the Burial and Cremation (Scotland) Act 2016; and
(b) any other relevant circumstances that the applicant brings to their attention.

There are five  elements in this process: the circumstances and resources of a claimant, the circumstances and resources of the deceased, the arrangements made for a funeral, the relationship between the claimant and the deceased and the situation of other relatives who might potentially pay instead.   Of course it can’t work.

What else could the government have done?  We already have public funerals for isolated cases where people have no resources.  We could go for a much simpler, universal approach: remove local authority fees for lairs and cremations.   The cost is certain and relatively predictable, and I don’t think we need to worry about abuse, fraud, incentives to die or stimulating take-up from undeserving cases.

There is a general point to consider, too.  The Government is beginning with funerals because they’re relatively straightforward, but their approach has been to take the existing scheme and “drag and drop” the regulations with a few tweaks.  Far better to rethink.

The worst social security policy ever?

In a recent blog, Jonathan Bradshaw has suggested that limiting Tax Credits and Universal Credit to two children is the “worst social security policy ever”.  There’s a lot of competition for the title.  As Jonathan writes,

There are many competitors for this accolade in our history — less eligibility in 1834 Poor Law Amendment Act, the 1934 Unemployment Assistance Board household means-test, the 1991 Child Support Act, the 2017 lower benefit cap and, probably forthcoming, Universal Credit.  But the two-child policy is just morally odious.

That set me to wondering: aren’t there worse examples?  Here are a few other contenders.

Settlement and removal.  The effect of the settlement laws under the Poor Laws meant that the local parish had to support certain people, and that if they were in need elsewhere they’d be “removed” to their parish of origin.  That meant both that parishes did their utmost to avoid illegitimate children being born on their patch – if necessary, picking up a pregnant woman and dumping her on another patch – and that people in need were transported back to their original parish, regardless of their reasons for leaving.

Housing Benefit.  The Housing Finance Act 1972 set about demolishing the system of housing subsidies, and trebled rents in the process.  Housing Benefit was introduced initially in the form of Rent Rebate and Rent Allowance, supposedly representing a shift from subsidising bricks and mortar to subsisising people.  The benefit was staggeringly complex, the costs and management span out of control.  The effects were catastrophic, especially when they were combined with the costs of rent from Supplementary Benefit.  The first stage might be thought of as a blunder – the theory said that it would be more efficient to direct resources to people.  The second stage, introduced when it was evident that the first stage hadn’t worked, was a fiasco.  We’re still suffering from the consequences: a destruction of housing subsidies, a diversion of resources to private landlords, a horrendous poverty trap, and the introduction of restrictions (including the benefit cap) because the system is unworkable.

The Griffiths report.  Creating a quasi-market system in social care was widely welcomed by many people who ought to have known better, and the system still has its defenders.   The system depends on intrusive personal assessment, penal means tests, market distribution (which always leaves gaps) and lengthy delays in service delivery.  Some of the defences begin with feeble excuses, such as the claim that it would all have worked if only there was more money and the thing had happened more; some try to deny that we’ve been trying to do this for nearly thirty years and it’s never worked.   (It’s a social security policy, because it directs cash towards a test of need rather than  providing a basic service.  A large part of the funding came from the  resources for residential care that were being paid for in social security benefits. )

Reclaiming overpayments.  The practice saddles people on low incomes with long-term debts. It used to be the case that claiamnts could only be directed to repay money if they had misrepresented or failed to disclose a material fact.  That was overturned with the Tax Credits system, which presented people with demands for repaying thousands of pounds they had no reason to suppose they weren’t entitled to.  The Ombudsman laid into the system as being fundamentally unsuited to the needs of the low income families it was supposed to help.  Now the same principles are being rolled forward into Universal Credit – and, it seems, the new Scottish system of benefits, including benefits for disability.

Disability assessments.  I’ve already referred to personal intrusion.  Why is every person who is sick required to undergo an assessment?  Why are medical records disregarded?  Why is everyone being asked about going to the toilet?  Why are most of the people who are too sick to work being required to attend sessions to indicate a readiness to work?

Suspending benefits.  When the “four-week rule” was applied, research (by Molly Meacher) reported that about a third of the people subjected to suspensions were convicted of their first criminal offences afterwards.  Now lengthy, indiscriminate suspensions have become a major aspect of the social security system, with getting on for a quarter of all claimants having benefits sanctioned for a period, and some having benefits cut off for three years.    There are no circumstances where leaving people without enough to buy food is ever justified.

These policies have something in common.  In every case, it’s not just that the policies didn’t work; it’s that after they had been tried out and were shown to have bad effects, the responsible governments ploughed on regardless, and rolled them out more generally.  That’s the point at which incompetence crosses over into immorality.  And that’s why Universal Credit is such a horror: it takes every element in recent years that has been shown not to work (tapers, sanctions, delays, assessments, obstructions to redress, transfers of process across agencies, multiple moving parts, and so on), and builds a whole system round them.

 

 

What benefits are for

A response to my post yesterday on Twitter asks:  “Wondering what “directed to the wrong purposes” really means?” Twitter isn’t a good medium for discussion, so I’m going to try to deal with it here.  This government believes, I think genuinely, that the primary purpose of benefits is to help people into work.  That was the view not just of the Coalition before them, but the Labour government after 1998:  people may remember the slogan, “work for those who can, support for those who cannot”.

I tackle this point in my book, What’s wrong with social security benefits?  Most people on benefits aren’t expected to work (actually, most of them are pensioners); most people of working age aren’t expected to be in the labour market; most of the rest are working.  Benefits are there for lots of reasons – among them, meeting need, relieving poverty, economic management, social inclusion, subsidy, compensation, and so on.    When we get to particular categories of people, such as disability, the aims multiply; for example, I gave a special presentation last year about the provision available for people with mental health problems, and the list I’ve just given here doesn’t cover the ground at all.  When we get to the issues of Universal Credit, pat formulas about work miss the point; and the incongruity of lumping together issues such as self-employment together with incapacity, homelessness and child care  helps to explain not just why the system isn’t working, but why it can’t.

 

Tinkering with Universal Credit

The announcement of modifications to Universal Credit in the Budget fall a little short of what is needed.  Para 6.14 outlines proposed changes:

  • advances on entitlements for those ‘in need’ – effectively an interest free loan repayable over twelve months.  UC will continue to be paid in arrears.
  • the reduction of waiting time by 7 days; it will still be 5 weeks for most claimants.
  • continuation of Housing Benefit for two weeks.  That should reduce rent arrears by two weeks – it is not enough to ensure continuous payment.
  • ‘easier’ arrangements for payment of rent to landlords.
  • a slower roll out, still to be completed by December 2018; and
  • a limited trial of ‘innovative” approaches to improve earnings.

What the proposals didn’t include was

  • a review of tapers
  • a review of work allowances – the current allowances are too low to lead to continuity of contact
  • a review of the treatment of children
  • pause and fix, or
  • any announcement of measures to deal with the administrative problems.

Para 6.12 and 6.13 defend the system’s design. The government evidently thinks that the scheme is okay because people on it are working, and that if there are residual problems it’s because people are not getting out and working.  They haven’t realised that most of the people on working age benefits, and so most of the people the scheme is going to deal with in due course, are unable to work, and most of the rest are working already.  (Universal Credit should ultimately be there for 6 to 7 million people; only 1.4 to 1.5 million of them are ‘unemployed’, that is not working and available to work.)  The roll-out of Universal Credit began by focusing on a particular category of claimant, mainly younger single applicants; but as the scheme expands, more and more of the people who are being dealt with will be in other categories. That’s why problems such as self-employment or telling people who are working to come in to the office are only really emerging now.  The scheme is not so much ‘unfit for purpose’ as directed to the wrong purposes – and that means that no amount of reinforcement is ever going to make it appropriate to people’s needs.

A new direction for social security tribunals?

In February, Sir Ernest Ryder, the Senior President of Tribunals, was suggesting that tribunals were likely to move into online hearings, and that social security tribunals would be pioneering the approach.  That announcement was received with some apprehension, because the experience of digital communication and systems supposed to be “digital by default” has not been good for claimants; it assumes access to resources and a level of competence with IT that many people would find challenging.  The technology for managing group meetings is improving, but it’s still buggy and difficult to access; the added security needed for tribunal hearings is liable to add to that.

In a recent talk, however, Sir Ernest has been offering more insight into his thoughts about the conduct of social security tribunals, and it may not be what the critics expect.  He has been complaining that the incompetence of the DWP has clogged up the tribunal system.  Mandatory Reconsideration is no help – the number of bad decisions has been mounting.   In most of the cases submitted by the DWP, “there could be no argument in law or on facts that the appellant wouldn’t win.”   Ryder would like to give tribunals the right to reject the DWP’s papers without wasting time on a hearing.

Why the Scottish Government should not be using Mandatory Reconsideration

I was told yesterday, rightly or wrongly, that the Scottish Government is planning to stick to their proposed system of mandatory reconsideration –  the requirement to submit issues for review before an access to appeal can be allowed.  The government’s justification is, apparently, that there will be an important difference between their approach and the current practice of the DWP:  benefits will continue in payment until the issue is resolved.

There are three sorts of misapprehension here.  The first is about what happens when people’s benefits are stopped.   There is a problem, but this measure is not going to resolve it.  Benefits are often stopped first – that’s why people have to challenge the decision.  If it proves that someone is not entitled, any benefits paid under this arrangement can be recovered.  So, under these proposals, the benefits will stop, restart, stop again after review, restart after appeal, and possibly stop again – with repayment demanded every time.

The second misapprehension is that a formal review process is useful or necessary. Under the previous system, all grounds for appeal were scrutinised and acted on by the Department for Work and Pensions before the introduction of MR; so MR adds nothing to the actions of the agency.  What the introduction of MR did was to create an extra hurdle for claimants – a barrier to access to justice.

That leads to the third point: that the operation of MR is unlawful.  The Policy Memorandum issued by the Scottish Government argued that

“Without a re-determination stage, it would mean that all decisions being challenged would go to a tribunal. This could lead to the tribunal being inundated with large volumes of appeals, which will increase the likely waiting times for individuals to have their cases heard, resulting in a frustrating experience.”

It’s not so frustrating as bening denied access to justice.  In Unison v Lord
Chancellor, the Supreme Court stated in terms  that the creation of administrative barriers with the intention of preventing people reaching court is unlawful. Appeals are not just there for the appellant.  They are there to make sure that the system is done right for everyone else.   If the Social Security Bill is passed in this form, expect it to be challenged.

 

Soviet Russia was not kind to benefits claimants

At a session about social security yesterday, one of the speakers invited us to celebrate the inspirational anniversary of the  Russian Revolution.  As someone mainly concerned with security rights and dignity in social security, there’s some incongruity in that request.   Soviet Russia was not wholeheartedly supportive of people who needed benefits to survive.  The laws against “parasites, tramps and beggars” varied between the different republics of the Soviet Union, but they included penal policies and fora for public humiliation. There are three articles about it by Beerman in the journal Soviet Studies:  “A discussion on the draft law against parasites, tramps and beggars”, 1958, 9(2), 214-222; “The law against parasites, tramps and beggars”,  1960 11(4), 453-455, and “The parasites law”,  1961, 13(2), 191-205.  No doubt a similar law would go down well with certain sections of the UK press, but it’s not a model to be followed.

The Scottish Government edges towards a social security policy

The Scottish Government has released a series of ‘position papers’ outlining its approach to social security provision.  Some of these papers are very thin, but in the hope that people will find the reference useful, here’s the list:

I’ve previously commented on most of these issues.  I’d like to see a system that is less geared to replicating the DWP’s adversarial approach and more to a ‘learning organisation’, that takes the responsibility itself for correcting mistakes and learning from them.

Universal Credit: what took everyone so long?

There’s been a flurry of calls for the rollout of Universal Credit to be delayed (e.g. from two reports from Citizens Advice, and concerns from  Louise Casey and a clutch of Conservative MPs).   It’s still possible to hear people saying what a good idea Universal Credit is, how it was going to simplify everything and how it would help work incentives. “The trouble with Universal Credit”, a New Statesman article tells us, “is that everyone thinks it’s a good idea.”

There are four sorts of problems.  First, there were the basic flaws in the design.  I wrote this in a paper published in 2013:

Means tested benefits are not, of course, the only benefits which are subject to problems.  There are other aspects of the benefits system which are cumbersome, badly designed and problematic for claimants and administrators alike. They include, for example,

  • benefits which people cannot work out they’re entitled to
  • the problem of repaying money that people did not know they should not receive
  • rules that tell people they must work at the same time as recognising that it‟s not reasonable to work (the current position for ESA)
  • the medical reassessment of claimants
  • benefits which penalise claimants for circumstances outside their control
  • the cohabitation rule, and
  • complex assessments that require people to report changes across multiple dimensions.

Universal Credit has the lot. It is as if someone has started with a list of everything in the benefits system that causes problems and designed the new benefit round it.

Then there was the abandonment of all the benefit’s objectives, one by one. All the primary objectives – such as simplification, work incentives, reducing in-work poverty, smoothing transitions and cutting back on fraud and error – have been fatally compromised. The marginal rate of deduction is much higher than intended. The cuts in work allowances have removed any incentive for most claimants to remain in contact with the system if they find work.

Third, there were the problems of implementation.  None of the innovative methods envisaged – real-time processing, smooth tapers, digital by default – was achievable. There is no effective system for coordinating and pooling all the information required in one place – the new system has come to rely primarily on returns from claimants about changes. The system makes complex demands of claimants (for example, those relating to security, agreements by couples or job search) which are almost impossible to police.  It system relies on accurate information from claimants, and people cannot respond sensibly to questions they do not know the answer to.

And then, last of all, there are the so-called ‘teething’ problems – miscommunication, lost payments (surely that ought to be a priority concern?), and the difficulties of introducing the new benefit at the same time as managing a large injection of additional rules such as  conditionality and housing. With or without Universal Credit, we are already in the position where nearly a quarter of unemployed claimants have had benefits stopped.  Universal Credit is not just threatening  a major breakdown in the safety net; it has already happened.

I did wonder, before I started, if I really needed to bother writing all this again.  I’ve been making the same sorts of criticisms of Universal Credit for nearly seven years now – try this blog from October 2010,  when I was arguing that the scheme was simplistic, impractical and wouldn’t either enhance work incentives or reduce administrative errors.  While it’s encouraging that so many people are waking up to the problems – it’s never too late to make things a bit better, at least – I have to ask: what took everyone so long?

“Well, here we go yet again … another sorry tale of HMRC institutional incompetence and inefficiency”

The judgment of Justice Nicholas Wikely in the Upper Tribunal in VO v HMRC (TC) [2017] speaks for itself:

“Well, here we go yet again.  I used the phrase “Well, here we go again” with a sense of frustration, bordering on despair, to open my decision in NI v HMRC [2015] UKUT 160 (AAC), a case in which I criticised Her Majesty Revenue and Customs (HMRC) for both its decision-making processes and its conduct of appeals in relation to tax credits claims. .. So, yes, in short this is yet another sorry tale of HMRC institutional incompetence and inefficiency which could well have led to injustice, were it not for the persistence of the Appellant.”

But of course, it did lead to injustice: the denial of entitlement and redress for five years. The judge explained the case as follows:

The HMRC written response to the Appellant’s appeal made the case look very
straightforward. In a nutshell, the Appellant had failed to reply to a request from HMRC to provide evidence of her entitlement to tax credits. She was therefore no longer entitled to tax credits for the relevant tax year and was liable for a substantial overpayment. So, according to HMRC, it was an open and shut case. End of story. … In her notice of appeal, the Appellant stated that “as I previously explained, I forwarded all the information required from me and to my surprise you never received the documents” (emphasis added). I interpose here that I have underlined the phrase “as I previously explained” as this statement alone should have rung alarm bells for the FTT. This is because there was nothing at all in the HMRC evidence provided with the appeal response to suggest that the Appellant had made any contact with HMRC before her notice of appeal … In the parallel universe that is tax credits adjudication, the file does not actually include something as elementary or fundamental as the actual decision notice. As HMRC’s original response to the FTT appeal explained, the HMRC computer cannot provide a copy of a decision notice – only the claimant can do that. So, in a classic Orwellian doublespeak, the response continues: “HMRC has not omitted to include the decision notices from the bundle; it is simply unable to provide copies”. How are we supposed to respond to this? “Oh well, that’s alright then.” Who designed this computer system? Did anyone think to check it was compatible with basic tenets of good public administration, let alone the principles of administrative justice?

He warns first-tier tribunals not to take HMRC’s statements on trust.

The basic principles of administrative justice include the right to know what the argument is against you, and the right to have a hearing. The same disregard for citizens’ rights, of course, is found in decisions about sanctions, where penalties are frequently imposed before the claimant has any opportunity to object.