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 – the difficulties of introducing the new benefit at the same time as managing a large injection of additional rules about waiting time, 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?

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