A blog from LSE, and a recent article in the Times (behind a paywall), suggest that we should acknowledge that politicians have “good intentions”, even if the policies go wrong: Universal Credit is the model. There are certainly many people who accept the view that Universal Credit was intended to be simpler, more effective and capable of getting people into work. I’m sceptical that that captures the true intention. In 1994, Iain Duncan Smith made a case in the Daily Mail (13 April 1994) for a single, unified benefit in very different terms.
ODD, isn’t it, that as Britain’s standard of living has steadily improved, the number of people claiming State benefits has increased, rather than declined?
… The problem lies in the very way the system works. Far from merely providing people in need with a national minimum level of subsistence, it encourages dependency. … Vast sums of money are lavished on running something which is, inevitably, prone to abuse on a massive scale. What we need are fundamental changes – and soon. …
At present we make payments to the old, the sick and those with children, regardless of their financial situation. This nonsense means that a major part of the expenditure goes to help people who don’t need the money in the first place. … people become trapped, remaining dependent on the State rather than on their working abilities. No matter how much someone wants to work, a job is not a particularly attractive option if it means financial loss. What’s more, the system actively encourages people to change or disguise their lifestyles in order to maximise their benefit entitlement. Who can doubt, for example, that some of the mothers now claiming single-parent benefit are actually living with a partner more or less full-time? … It should make us all angry that while many deserving cases are failed by the system, the greedy and workshy profit from it.
So what can be done… ? … There should be just one, income-assessed benefit, with all the relevant factors taken into account to cater for the needs of the individual and his family. This should be administered by one body, instead of the multitude of offices, each handling one type of benefit, we have now. … The new benefit must also aim to make going back to work a more attractive option for the unemployed. The benefit should not be set too high and would need to be ‘tapered’ so that if people took jobs paying less than current benefits, they would not lose all their benefits immediately.
This is not, of course, the account famously given by IDS, as a New Statesman article showed, but the elements of Universal Credit were there long before his supposed ‘conversion’. The basic argument for what became Universal Credit was that it was going to save money, prevent abuse and discourage dependency – not that it would give people a more secure, predictable income when moving in and out of work.
I’ve pointed to many of the deficiencies in the design of Universal Credit, but the worst problems with Universal Credit are not there just because it is a clunky, means-tested benefit. There are two other aspects of the reforms which have created particular problems. The first was the assumption that benefits were aimed at people who ought to be working instead. Most benefits go to pensioners – something else that Duncan Smith disapproved of in his Mail article. Most of the rest of the benefits have no direct relationship to people who are not working – Tax Credits, disability benefits and housing benefits go to people in or out of work. Most of the rest after that were people who were not expected to work – single parents and people with incapacities, both the target of punitive and work-related action. And most people claiming as unemployed – about 80% – return to work in the course of a year regardless. Universal Credit was initially supposed to go to 7 or 8 million people (the target numbers have been falling); the primary target group for employment-related action was certainly less than half a million, if we include single parents and people on ESA, and less than 200,000 if we don’t. Redesigning policy around readiness to work – a process begun by the previous Labour government – is an imposition of the wrong policy on the wrong people.
The second problem has been the abandonment of the idea that no-one should be left completely destitute. Benefits are being stopped cold for a variety of reasons – sanctions, reappraisals, revisions and, unjustifiably, administrative transition to the new system. Some people have been driven to our “uplifting” food banks. Here are a few more outcomes to lift you up: