The new figures for takeup of means-tested benefits show an interesting trend. Takup is falling, and the initial impression given is that there has been a slow, marginal fall in in takeup overall. However, the fall is not the same across the board. The takeup that has most clearly fallen relates to the housing costs of private tenants. It seems unlikely that this is driven by increasing ignorance about benefits, and that tends to suggest that something is happening in the private rented market – most likely, that landlords are restricting access for claimants.
The Brexit agreement is largely a pragmatic document which tries to steady the ship, rather than a major breakthrough in any direction. Fisheries, for example, are not resolved – they’re simply put into abeyance before for the next round. The whole document looks like a draft, with loads of white space around sections – when a Labour spokesman talked yesterday about it being 600 pages and ‘tightly spaced’, it was clear he’d not even looked at it, because he couldn’t have said that if he had.
Some elements in it are disappointing, but to my mind the sections which most prompt concern almost certainly reflect the negotiating position of the British Government. I’d point in particular to
- Article 15(1), which gives people a right of residence only after they’ve been in athe host country for five years. That is an abdication of responsibility both by the EU (which guaranteed movement as a fundamental right) and the UK (which made the same guarantee to its own citizens).
- Article 92(5) and Protocol IV.7, which bind the UK not to offer state aid to business; and
- Protocols V.17 and 18, which void elements of contracts which have non-commercial justification, a principle used to negate local minimum wages and agreements with labour unions.
It’s also important to note what’s not there: protection for the rights of citizens who might reasonably expect to live and work abroad but have the misfortune to be domiciled in their home country at the moment, cross-border families in the same situations, or derogations from EU law relating to internal management of the British economy.
These are not, I know, the issues that most excite our politicians. I’m sure someone will notice that the protocol with Northern Ireland stresses the importance of access to the UK for goods from the province (pp 304 and 313), but not vice-versa. It’s possible that the whole agreement will founder on that.
The agreement could have been better. It would have been better if the government had thought through its position at the start; if it had consulted with interest groups, rather than keeping negotiations secret; and if it had used EU law to hold the EU to its treaty obligations. It probably would not, however, look a lot different from the document we have now. Ultimately I expect Parliament to fold, but even if we were to go through another election any commitment to implement the referendum decision as it stands will end up looking something like this.
Brexit should be stopped. We can debate what the duties of a government are, but I’m fairly sure that it doesn’t include a direction to drive the bus over the edge of a cliff.
However, I’m not convinced that the way to do this is by another referendum. That would imply that if the referendum was to confirm the original decision, we should abide by the majority’s decision, and I do not accept that we should.
There were three obvious problems with the referendum in 2016, and all of those problems are still there. The first problem was that several million people were directly and immediately barred from voting. Those people included British citizens living in Europe, and European citizens living in Britain. There is no possible revision to the electorate which will not lead to one side or another crying ‘foul’.
The second problem was, as we now know, the combination of illegality and downright lies that characterised the campaign to Leave. There is no reason to suppose that the next campaign would be any cleaner.
The third problem would be true of any referendum. It is democratic to encourage people to express their views, and we have a convention that decisions are decided by majority rule. However, it is not democratic for any majority, ever, to deny rights to minorities. We should not tolerate a situation where half the population votes to extinguish the rights of the other half – and that, in effect, is what has happened.
When the government accepted the brief to negotiate exit from the European Union, their first responsibility – and the first responsibility of EU authorities on the other side – was to defend the fundamental rights of citizens. Both sides have a clear, unequivocal, treaty-based legal obligation to safeguard individual rights. Both sides have failed to do so.
The House of Commons Work and Pensions Committee has reported critically on the sanctions regime. The Committee recommends that
- sanctions should stop for people who do not have capacity for work
- there should not be in-work sanctions on UC until the system is fully operational
- deductions should not be more than the benefit
- there should be clear rules about what is a good reason for non-compliance
- there should be warnings before the first sanction, and
- families with young children should not have more than 20% of benefit deducted.
They accept that “Sanctions must be a last resort and claimants should be able to challenge the decision before it is imposed.” That alone would make a marked difference to current practice.
This could have gone further. The DWP has no evidence about the effects of sanctions in most cases, and the Committee asks them to get some. That looks like a recipe for delay, because there’s no shortage of other evidence. Looking over the recommendations, the Committee clearly sees no good reason to sanction people who have no prospect or reason to go to work instead – and that is the vast majority of people who depend on ‘working age’ benefits.
The main story in the Budget is about Universal Credit, but the measures taken fall rather short of what would be needed to save the benefit. The Work Allowances are increased for some, but not for people without children – a high proportion of current claimants, because they went on the system first – and one of the main effects of cutting the Work Allowance has been that they have little reason to remain in contact with the scheme as income fluctuates. Most of the administrative problems are untouched, and a slightly slower rollout (still continuing, but slowing by a few months) is not going to make much difference to them.
The other part of the Great Plan, which is less noticeable, is a declaration of the intention to continue with the abolition of Housing Benefit by moving to a Housing Credit within the Pension Credit system. This provision was set up rather a long time ago, in 2011 – I have to admit I’d forgotten about it – and it will take a long time, now planned for late 2023, to be fully implemented. At the time the government suggested, bizarrely, that combining Housing Benefit into Pension Credit should improve takeup. It will probably have the opposite effect. Housing Benefit is more effectively accessed than PC; that’s probably true because social landlords steer their tenants towards an application, and they won’t be able to do the same with Pension Credit.
There’s another issue besides. We’ve seen in Universal Credit that the effect of transferring Housing Benefit back to the DWP has been to create confusion: DWP officers don’t necessarily know about housing (for example, what a tenancy is) or what they need to do. (We had the same problem in reverse when the DHSS initially transferred responsibility for rent to local authorities in 1982.) Killing off Housing Benefit will also finally kill off the expertise of local departments that learned the hard way how to make the system operate despite its arcane rules.
I missed it when it came out at the beginning of this month, but an interesting report from the Scottish Public Health Observatory has been trying to identify the possible impact of new benefit policies in Scotland on the health of the population. The figures are complex, but the basic principle behind them is reasonably straightforward. Their argument is built on the case that higher income leads to fewer deaths and less health inequality. Effectively, then, their report is an assessment of the potential distributive impact of different policies in Scotland. Critically, however, the distributive impact they are considering is not the distribution for individuals or households, but for deprived areas.
Part of their summary is a fairly confusing graph, which seems to suggest that the best method by far would be to increase means-tested benefits by 50%. The comparison being made, however, is with other policies with very different sizes and shapes – for example, increasing takeup by 1% (a very marginal increase, costing little) or introducing Citizens Basic Income and abolishing all other benefits (a very major change, costing a great deal). The details about what’s covered and what’s not are sketchy, and the figures are, of course, indicative rather than certain. The core of the message is this:
increasing means-tested benefits by 50% is modelled to have the biggest effect on reducing premature mortality (5% prevented) and narrowing inequalities in premature mortality (-8%). The results also suggest that the real Living Wage, Local Income Tax and increasing devolved benefits by 50% would be good policies for reducing premature mortality (~2% prevented for each). The two illustrative CBI schemes are also likely to be effective at narrowing health inequalities (-4% for CBI, and -6% for CBI Plus).
In the supplementary papers, Table 2a, it’s possible to find a statement of costs per outcome. This also needs to be treated with caution, because the costs of CBI cannot be introduced in part; but the best value for money, in the sense of effect for each pound spent, comes from CBI , improving DLA and PIP, increasing takeup and increasing basic means-tested benefits. The powers of the Scottish Parliament don’t cover all these options, but they do include powers to improve disability benefits and to increase takeup. There’s a case to consider, but there has to be a major reservation: at the level of individuals and households, there would be losers among those who are poorest.
The Economist this week describes Universal Credit as a good idea, badly done. We can agree at least on the second part. Here are three justifications they offer for thinking it’s a good idea.
“Streamlining benefits into one monthly payment will eventually make the system easier to deliver.”
Combining six benefits into one doesn’t actually streamline anything. Universal Credit ‘brings together’ a range of benefits, but unemployed people are still subject to rules on benefits, sick people are still subject to rules on sickness (and work conditionality, too!), the housing components are still subject to all the rules on housing benefit, and so on. Lumping everything together in one mass makes for one, highly complicated benefit. It also adds one potentially catastrophic complication: actions which lead to the revision of entitlement in one component (such as changes in household details, or the application of conditionality) can lead, catastrophically, to an interruption or cessation of entitlement.
“It removes perverse incentives whereby somebody moving from welfare to work can lose about as much in benefits as they earn.”
There is a slight mitigation of the ‘poverty trap’, because the interaction of Housing Benefit and Tax Credits are removed for some; but since the taper is 63%, further deductions are made from salary for National Insurance and tax, and the system doesn’t include Council Tax rebates, the marginal rate of deduction is typically 70-74%, and can be more.
“Allowing people to make a single application for all their benefits should improve take-up, and so reduce poverty.”
Requiring people to negotiate a complex system, with limited flexibility about application details, has caused major problems in access – check, for example, this blog entry on the NAO report in July – and that can be expected to appear in takeup figures in due course.
It seems, however, that the myth that Universal Credit was sound in principle refuses to lie down and die, despite being shot, stabbed, buried, set on fire and otherwise subject to refutation. When the scheme was first mooted in October 2010, I wrote that it was over-simplified, impractical and couldn’t achieve what the government claimed it would achieve. If government sets up a scheme that can’t possibly work, it shouldn’t be surprising that it will make a mess when it’s put into practice.
I never used my legal training, and in some important ways I’m sadly out of date: this is one of them. Confidentiality agreements used to refer to the protection of internal information relating to a business; they have become a means of silencing criticism, something quite different. I was sufficiently perplexed by the reports of the current affairs relating to Philip Green to want to read the Court of Appeal’s judgment.
The fundamental problem, barrister Jolyon Maugham has written, is that the Court of Appeal has failed to take account of the imbalance of power. Obviously enough, the gagging orders are taken by people in a position of privilege against less powerful employees, usually women. “How did the Court miss this?” It didn’t miss it, but it did wave it aside. In paragraph 42, the Court notes that it is hard to get a settlement of litigation without an NDA; in paragraph 43, they refer to agreements as valid if they are not subject to pressure. Pressure is built in to the process.
The Court takes the view that a settlement of litigation can routinely include a rule of confidentiality. At the start of the judgment, the Court considers the NDA as a subordinate part of the Settlement Agreement. “There were terms in each of the Agreements under which both sides undertook to keep confidential the subject matter of the complaints themselves and various associated matters, including the amounts paid by way of settlement. … We will refer to this aspect of the Settlement Agreements as non-disclosure agreements (NDAs).” After that, however, it refers consistently to “the duty of confidentiality”. The Court took it that confidentiality should be presumed to be upheld unless there is a strong element of public interest which requires otherwise – and held the hearing in private session on that basis. That should not be taken for granted.
There are three problems with applying a rule of confidentiality. First, it has not been established whether there is such a duty; the Settlement Agreements apparently make exceptions for certain lawful actions and, as the Court itself recognises, “confidentiality could not be relied on to conceal wrongdoing.” The rules are supposed to protect confidential information, but there is no “information” in this case; the main thing being held in confidence is the agreement. Openness is fundamental to justice.The presumption of confidentiality on the basis of a Settlement Agreement is illegitimate; it has to be justified.
Second, if there is a duty, it is not owed by the Daily Telegraph, which on the face of the matter had already been informed about the existence of the Settlement Agreements and the NDAs. That already constitutes, in the terms of another set of laws, publication: the knowledge in question has been conveyed to a third party. If there is any breach, the breach is by signatories, and action lies against them. The substance of this action depended on a supposition that if there had been a leak by one of the parties to an NDA – that has not actually been established – any duty of confidentiality they owed to the other party must be extended to the newspaper. I think it could be argued that talking to a newspaper magnifies the offence of someone breaching an agreement; I cannot see that the newspaper owes any duty of confidentiality to either party. There is no justification for preventing publication, unless in some way the newspaper itself violates the complainant’s rights in the process. In this case, there is no indication that the Telegraph has acted improperly in any way.
The third point is the one that runs deepest. The Court of Appeal has taken a view about the confidentiality of settlements which is inconsistent with the Rule of Law. The Supreme Court’s recent judgment in the Unison case emphasises the essential nature of access to justice.
The constitutional right of access to the courts is inherent in the rule of law. … Access to the courts is not … of value only to the particular individuals involved. … it is not always desirable that claims should be settled (my emphasis) … the value to society of the right of access to the courts is not confined to cases in which the courts decide questions of general importance. People and businesses need to know, on the one hand, that they will be able to enforce their rights if they have to do so, and, on the other hand, that if they fail to meet their obligations, there is likely to be a remedy against them. It is that knowledge which underpins everyday economic and social relations.
It seems to me that the Court of Appeal has lost sight of this fundamental principle. They have treated a settlement agreement as virtually equivalent to access to justice; it cannot be. A private agreement to avoid litigation may be beneficial, but it cannot bind others, it cannot remain secret, and it cannot be treated as the last word.
The report on Universal Credit by the Public Accounts Committee is pretty damning, but that should come as no surprise. The PAC argues, amongst other things, that
The Department’s systemic culture of denial and defensiveness in the face of any adverse evidence presented by others is a significant risk to the programme.
Universal Credit causes financial hardship for claimants including increased debt and rent arrears, and forces people to use foodbanks.
The Department is failing vulnerable claimants because it places too much reliance on the discretion of its work coaches to identify and manage the needs of people requiring extra support.
The package of support to help claimants adjust to Universal Credit is not fit for purpose
Universal Credit is pushing costs onto the local organisations that support claimants – including local authorities, housing associations, and foodbanks.
We are seriously concerned about the Department’s ability to transfer around 4 million people from existing welfare benefits to Universal Credit without causing further hardship to claimants.
They also comment that the DWP can’t assess or justify its claim that UC will push another 200,000 people into work, but that’s hardly a major criticism; the suggestion that a rollout causing hardship to 6-7 million people can possibly be justified by changing the behaviour of 200,000 of them simply reinforces the lamentable distortion of perspective and priorities that has blighted this system from the start.
The flurry of criticisms that people have been making in the last couple of weeks are of different kinds. Some are about poor administration. Claimants are supposed to track changes in their online journals, and the DWP can’t absorb information that’s presented in this way. (Even The Sun has noticed.) Claimants who fall into rent arrears – that’s most – may have direct payments to landlords, but there is evidence from Citizens Advice that in some cases the DWP is deducting the rent from the benefit and not passing it on. A disturbing proportion of new claims are paid late, or not paid enough. The DWP is holding claimants to standards that it’s unable to meet itself.
Other criticisms, however, concern the way the benefit has been designed. The concern about women at risk of abuse was raised formally more than five years ago. UC has also been criticised for not being able to deal with people who don’t fit in its boxes, but the problems with dealing with non-standard “pathways” were identified right at the start. In 2003, the DWP commissioned a report which told them that segmentation, or working to ‘typical’ profiles, wouldn’t work: “Profiling outperforms the random allocation of treatments but wrong denial and wrong treatment rates are not trivial”. That didn’t deter pilots of segmentation for unemployed people in 2005, presenting details of segments in 2010 (when UC was first announced) and further commissioning of a ‘proof of concept’ on it in 2014. The problem is basic. This system is supposed to offered a personalised response to millions of people, and with that many people, there will always be some who just don’t fit.
It’s being reported that Universal Credit is to be delayed again. There are also suggestions that a small number of minor tweaks will be made – allowing legacy benefits to run on for two weeks, changing direct payment rules and altering rules for self-employment. None of that really gets to the heart of the problems. The system is simply not designed for the variety and complexity of conditions it is supposed to deal with.
The BBC offers this graph of delays, citing the National Audit Office as source. It’s kind to the record, because it waves aside the failed attempts that led to the system being “reset” in 2013. The original deadline for the completion of the rollout was not 2019, but 2017. The planning has, of course, been going on since 2010, and at no stage has it ever seemed likely that UC could be delivered, as Iain Duncan Smith repeatedly claimed it would be, on time and within budget.
I’ve been blogging about the problems with Universal Credit since October 2010, and complaining about the bogus claims made for it since the first glimpse of a business case in 2013. The Treasury failed altogether to follow its own procedures, undertaking massive expenditures before any plan had been submitted. The lack of routine scrutiny has been scandalous; but not as scandalous, I regret, as the way that claimants have been treated in the hope of sparking life into the monster.