The High Court judgment on Universal Credit payments has implications beyond the immediate issues. It condemns the DWP for simply following through an automated process for income testing rather than considering the actual circumstances of the claimants – in this case, the early payment of monthly salary.
When the idea of making assessments in ‘real time’ was first mooted, in 2010, I was critical of the idea. In the course of the last eight years – yes, it’s that long – I’ve posted a range of comments about the effect of assessing income on the basis of the current month. I’ve just been reading through my old posts to make a list:
- it deals with uncertain information
- it requires the system to process information that it doesn’t have access to
- it deals with information from diffuse sources
- it’s not applicable to the circumstances of self-employed people
- it puts claimants into default when things go wrong
- the system can’t cope with irregularities in the calendar, like bank holidays or Februaries
- it provides an income that is fluctuating, unstable and unpredictable.
To this, we can now add another point: mechanical calculation yields arbitrary and unreasonable results.
Surely, people in favour of means-testing might reasonably ask, there’s no real difference in principle between monthly assessment and the assessments we used to have? That may be true. Many of the problems we’re seeing are problems that we’ve known about for years. They include:
- the problem of offering fluctuating incomes to people on very low incomes – a system, the Ombudsman commented about Tax Credits, fundamentally unsuited to the needs of low income families
- the problems caused by tapers, which mean that people can’t tell when they’re entitled to benefits and when they aren’t
- the problems posed by changes of circumstances, and
- the devasting effect when changing entitlement to one benefit (such as Income Support) spills over into suspension or recalculation of another (such as Housing Benefit) .
Universal Credit, I’ve previously written, “brings together every major feature that has caused administrative meltdown in the course of the last forty years … It is as if the designers had painstakingly identified all of the elements of the benefit system that are known not to work and built the new benefit around them.”
One thought on “Monthly assessments for Universal Credit aren’t working”
Agreed. When I worked in a housing association a different mathematical problem caused havoc with rent accounts. Rents are traditionally charged on a monthly basis (commercial rents per quarter I believe!) but Housing Benefit is often paid 4 weekly, or 2 weekly or weekly; so with that and a time delay between rent accounts being debited with rent due and subsequently credited with HB payments it was always difficult to be entirely accurate as to whether a tenant was owing or owed money. Whilst UC paid on a monthly basis, the DWP assessment period of course will often be a different month than the landlord (usually end of calendar month). In many cases, it was only possible to fully “reconcile” a tenant account when the tenancy ended and all HB payments had been made. Council Tax (which of course has nothing to do with UC now but was previously linked to HB) is legally based on a daily liability basis but of course most folks receive an annual forecast assessment, in Scotland often divided in to ten periods, with Feb and March “free”, with Council Tax Reduction calculated on the annual bill pro rate (albeit CTR entitlement figures expressed per week!). None of this complexity and inconsistency is helpful to people on low and changing incomes.