The PAC condemns the implementation of Universal Credit

This morning the Public Accounts Committee has published a withering report on the management of Universal Credit.  They comment on the ‘extraordinarily poor’ management, the defensive mentality, lack of financial controls and the weakness of the pilots, which are not designed to deliver the information or methods that the project will need.  None of that should come as a surprise, because the problems have been widely reported for over a year.  The PAC report notes (para 6) that the DWP first became aware of problems with the programme in July 2012.  That cannot be true.  The Telegraph reported  on 25th September 2011 that the Treasury had been warned of the coming problems, and that a team had been set up to deal with them; the DWP issued a statement that the rumours were “completely untrue and utterly without foundation”,  but you cannot deny something without being aware that people are saying it.  The first delays in the timetable for the pilots were announced in June 2012, which suggests that the DWP had already been grappling with the problems of implementation before that.

Universal Credit is still described as having cross-party support, which is disappointing: one wonders how many problems have to emerge before people realise that a scheme is not going to work.   It’s tempting for politicians to say that the idea is good in principle but that it’s been implemented badly.  That’s not the problem here; the scheme has been impractical from the outset (I said so on this blog in October 2010).  The problems, the administrative turmoil and the bluster have burgeoned as a succession of different teams have realised the impossibility of the task they have been set.

Councils doing business

My eye was caught earlier this week by the news that Travelodge, which runs budget hotels, has been approaching local authorities to get them to build hotels for Travelodge to run.  The arrangement will enable to councils to get a returrn on land, as well as a degree of city centre investment.  It needs, however, loans (or at least, loan sanction) from the Treasury.  There have been some initial developments on this basis.

I’ve long been of the view that government, and local authorities, should be able to do whatever is appropriate to advance the welfare of their citizens; that’s what they’re  there for.  I’ve suggested, too, that governments should be able to engage in enterprise and make profits for its citizens.  The intriguing thing about the Travelodge proposal is that the initiative has come from the private sector – which seems to make it politically acceptable – whereas initatives from within the public sector are knocked back.  Active government is one of the principal means of generating economic activity, employment and growth, and any policy for regeneration depends on it.

IDS and the anatomy of incompetence

Iain Duncan Smith’s reaction to the NAO’s criticism of Universal Credit has been to blame someone else.  Perhaps it’s the fault of the IT people.  He told the BBC (also reported in The Telegraph):  “The problem was that those charged with actually putting together the detail of the IT – I’m not a technologist and nor are you, we rely on people telling us that that is actually correct – did not make the correct decisions but we intervened to change that. ”  That’s odd, because on the Today programme he explained he had actively intervened as early as 2011, and a year ago he explained that he was personally supervising choices and decisions about IT:   

“For what it is worth, I take absolute, direct and close interest in every single part of the IT development.  I hold meetings every week and a full meeting every two weeks, and every weekend a full summary of the IT developments and everything to do with policy work is in my box and I am reading it. I take full responsibility and I believe we are taking the right approach.” 

Nearly a year ago, too, an inside source was cited by the Independent saying this:  “IDS, like other ministers before him, has been hypnotised by promises of what an online system can deliver. Warnings were given to him more than a year ago. They were ignored.”

Maybe it’s the fault of the civil servants, who from IDS’s BBC interview do not seem to have taken on board his repeated explanations.  The Telegraph, leaping to IDS’s defence, comments that “The Universal Credit debacle is the fault of the Civil Service, not Iain Duncan Smith.” IDS has said he has ‘lost faith’ in his civil servants, who were “just wanting to be able to say it was going well.”  That problem was also being reported a year ago. 

The basic problem, however, is the problem of the Universal Credit scheme itself: a badly misjudged project that is flawed in concept, aims, design and implementation. The prime responsibility for that, of course, rests with IDS, its leading proponent, who is also charged with delivering it. There is a wonderful article on incompetence by Kruger and Dunning (J Kruger, D Dunning, 1999, “Unskilled and unaware of it: how difficulties in recognizing one’s own incompetence lead to inflated self-assessments”, Journal of Personality and Social Psychology, vol 77 no 6 pp 1121-1134). They explain why people who are incompetent generally don’t realise it; the same skills and knowledge which would lead them to be self-critical are precisely the skills and knowledge they don’t have.

“We propose that those with limited knowledge in a domain suffer a dual burden: Not only do they reach mistaken conclusions and make regrettable errors, but their incompetence robs them of the ability to realize it.”

If Iain Duncan Smith had had the resources and knowledge to understand what was wrong with his policy and approach, he probably wouldn’t have done it. If there is a criticism to make of his civil servants, it’s that no-one seems to have been prepared to tell him, as Sir Humphrey once said to Jim Hacker: “If you are going to do this damn silly thing, don’t do it in this damn silly way.”

The NAO casts doubt on Universal Credit

The critical report on Universal Credit from the National Audit Office arrived during the Jewish New Year, so it’s taken me longer than usual to get round to it.  The progress towards UC has been slow.  The IT pilots are too limited to indicate whether they are capable of a national roll-out; the iterative, ‘agile’ approach was untested.  The oversight from the DWP has been inadequate, the process was not transparent and it was not put to the test.  Planning, process and project management were all wanting.

While none of this is unexpected, the report does not go as far as it might.  The key problems in IT are not just the product of poor implementation; they reflect a fundamental failure to understand the nature of the activity they were supposed to address.  When I was first asked about the scheme in the media, nearly three years ago, now, I argued that no computer could possibly do what the government was asking it to do.  More than 45 years ago, Richard Titmuss attacked ‘computermania’ and the folly of ‘expecting the computer to solve the problems which human beings have not yet adequately diagnosed’.  There is hardly a word of his critique that does not apply to Universal Credit.  He pointed to the complexity of family lives, the lack of common characteristics, and the particular difficulties of applying general rules oto the working age population.  He pointed out the problems employers would have in collating information, esepcially on information beyond the workplace, and the difficulty of coordinating benefits and tax.  And he emphasised, above all, that the rules and principles governing benefits called for issues of ‘moral values, incentives and equity’ to be taken into account.  “Computers cannot answer these questions.”  (It’s all in a well-known essay, “Universal and selective social services”, in Commitment to Welfare.)

For the rest, of course, it’s been obvious for some time that the implementation was not going well.  The procedure was never ‘agile’.   The secretive nature of the process  meant that even the most basic mistakes weren’t picked up.    The chaotic movement of civil servants is the predictable outcome of a project that no-one could be happy about.

Charities and charismatic leadership

The announcement, that some chief executives of major charities have high salaries, didn’t come as a great surprise.  Charles Moore, writing in the Daily Telegraph, attacked charity chiefs in general, but he also opined:  “Large charities need professional competence and charismatic leadership.”

The cult of the charismatic CEO does have its place.  Half of the activity undertaken by CEOs, possibly more, is outward facing – negotiations with the government, approaches to funders, speaking to the media and representation of the charity’s case.  ‘Charisma’ can help; for example, there are CEOs who can talk money down from the trees.  That’s a great skill to have, but it’s got nothing to do with ‘leadership’.  Whether leadership is about vision, direction, inspiration or motivation, that’s not what the CEO of a very large organisation generally does.

There are some outstandingly charismatic, competent individuals who work in the third sector, but they are not necessarily senior officers.  There are youth workers who can relate to, motivate and inspire young people who are disheartened, excluded and disengaged.  Community  work relies heavily on people who can inspire and motivate others to work together – in France, the task is sometimes called ‘animation’.   Neither of those professions commands the sort of salary that these rare  talents apparently justify.   I wonder why that is?

Putting money in the wrong bucket

A bequest left by a former nurse has embarrassed senior politicians.  She directed that her money should be used by the government of the day ‘as they see fit’.  Her solicitors misinterpreted the will and sent the bequest to the political parties that were in power.  Following public exposure, the coalition partners have agreed that the money should go to the Treasury, where it will disappear into general funds.

I doubt there is a local authority or a hospital trust anywhere in Britain that would have acted in the same way.  It is a standard principle in British public administration that public bodies can only act in accordance with the powers they hold within the law.  In most circumstances, that means that money can only be spent in ways that have been specified by law,  but there is an important exception.  Where funds become available that are not subject to those constraints, they can be used on a discretionary basis, without direct restraints, subject to the general reservation  that the governing body is acting in trust for the benefit of the public.  Then the money can be used for the kind of thing that normal funding can’t  – prize competitions, pilot projects, public amenities, events, charitable art-works, donations, whatever.  The patterns of accounting vary, but local authorities and pubic trusts will almost always have an ultra vires fund, designated unrestricted funds, a charitable arm or a separate account, distinct from other funding, so that they can manage bequests, donations and the like appropriately.

The current government, by contrast, seems to have been nonplussed by the situation.   The parties’ first reaction was to accept the solicitor’s statement at face value; the second, to drop the embarrassing money, like a hot potato, into the nearest bucket.   It might be, of course, that the UK cabinet considers that they already have unlimited authority to use money in any way they please (if they did, they would be mistaken).  It might be that they couldn’t think of anything better to do with the bequest, which begs the question why anyone should donate money to the government  in the future.  I suspect there is another reason for the misunderstanding.  It rests in the dominance of a new political class , whose preparation for public  office relates entirely to Westminster politics, and who have no previous  background in public service.   If more of them had the relevant experience, they would known what to do with a routine donation.

More benefits to be administered by hand

It seems that the DWP is appointing 112 additional staff to administer the benefit cap, a policy estimated to affect 40,000 people nationally. They will have to process the changes manually. The Independent attributes this to the failure to develop the new IT scheme for Universal Credit, but it’s not clear that if the system had been in place, it could have easily been adapted to do what the government hopes; the decision depends on lots of moving parts, including rent, family circumstances, the assessment of personal needs and income.

The problem is, bluntly, that decisions about the benefit system are being made on the basis that they look like a wizard wheeze that will make for good headlines; but when it comes to the dirty details of how to do things, the politicians can’t be bothered with the practicalities. This has been the pattern of a series of inept policies – the cuts in child benefit, procurement, IT commissioning, the Work Programme, the Universal Credit system itself. Nothing in the benefits system can be made to work on that basis.

"An historic culture of chasing targets"

I’m in the process of updating my textbook on Social Policy. Today I was putting together material on targets and performance indicators, when along came a prime specimen.

The report on Kent Police by Her Majesty’s Inspectorate of Constabulary provides a remarkable insight into the impact of targets on administrative practice. Some crimes are easier to resolve than others, so Kent Police had developed a practice of making sure that the easy crimes got the attention. They put the effort into clearing up cases of shoplifting and cannabis use, and recorded ‘no crime’ for some more difficult problems, including crimes of violence, burglary and rape. The Inspectors attribute this to ‘an historic culture of chasing targets’.

Later this week I’ll be looking at corruption and abuse of power, but of course I can’t expect anything new to happen there.


My polemical paper on leadership (and why we shouldn’t be using the idea) has been selected as winner of last year’s ‘Outstanding Paper Award‘ in the International Journal of Public Sector Management. The article is on-line here and the publishers have told me that itis going to be available free for a year.

A typsescript of the paper is also available on the Robert Gordon University‘s open access repository.

The Work Programme hasn't got any better

The Commons Work and Pensions Committee has just published their report about the Work Programme, and I”ve been talking about it on Good Morning Wales.   There are problems in trying to get information about the way the system works, but those problems were entirely predictable.  The government was warned in previous reports, from the Office for Government Commerce and the National Audit Office, that sub-contracting arrangements made by the DWP lead to a basic loss of control and accountability; their response was to encourage a ‘black box’ where they asked for even less information about the process.

The report raises particular concerns about vulnerable groups who are not receiving support, but the evidence they describe is mainly focused on the mainstream groups, and the position is not good.  The prime contractors have failed to meet their targets, and the Committee argues for the bar to be lowered. The strategy followed by the contractors is not, however, one to be encouraged.  There is little indication of effective systems for individual support; caseworkers have 120-180 cases apiece, and the general approach seems to be that they throw anyone to hand at available jobs in the hope that someone will stick.  There is little involvement of sub-contractors – out of 348 organisations, 74 thought they were not part of the Work Programme and 45 had not yet had any referral.

The system is however saving money.  Part of that is money that the Government had made available for the contracts, which will not be paid; part is the effect of penal sanctions on unemployed people.