A solid paper by Jane Millar and Peter Whiteford emphasises the problems of trying to refine means-tests by recording and responding to changes in circumstances. The problems of managing simple changes of circumstance, unpredictable incomes and overpayments have overwhelmed a series of benefits designed to be ‘responsive’. They cite a recommendation from the OECD:
In order to ease access barriers to social protection, policy makers should consider: … making means tests more responsive to people’s needs by shortening the reference periods for needs assessments and by putting appropriate weight on recent or current incomes of all family members.
I’ve been banging on about this for years – you’ll find about 25 relevant entries about changes in circumstance or fluctuating incomes on this blog, and a longer argument in my book, What’s wrong with social security benefits? The benefits that work best, like pensions and Child Benefit, are long-term. There is no practical way to obtain the sort of information required for responsive income-testing and deliver a system that is efficient, fair and workable. These systems are designed by those who are convinced that the problems can always be resolved by the technology, when we all know they can’t. We need to smooth things down, to ask only for information that makes sense to claimants, and to stabilise income. In other words, we need to be less responsive, not more.
I thought it a good paper as well and shared it. I wish it had extended its Universal Credit analysis to point out that it doesn’t just deal badly with varying circumstances, but it creates variation of benefit for people with unchanging circumstances. The structural design of assessment periods that interact bizarrely with pay periods, seems completely opposite to the original intent, set out in the CSJ paper that began the process.
“For many looking to enter the world of work, a potentially unstable pattern of earnings poses many risks, and deters the first steps into work. A better benefits system will take account of the realities faced by those entering low wage jobs. Security of income is important, especially when a potential worker has a partner and children to consider. Benefits should be provided quickly:they are to supplement the income of those who cannot afford a decent living otherwise. They should be managed in a way to reflect or compensate for the natural cash-flow issues of those transitioning into and out of work.”
Dynamic Benefits – Towards welfare that works
Centre for Social Justice
September 2009