Making Universal Credit work, and making work pay

5th Sep 2013

Blog: Universal Credit needs to be put on the right track, not abandoned, says Katie Schmuecker.

Universal Credit needs to be put on the right track, not abandoned, says Katie Schmuecker.

“Weak management, ineffective control and poor governance.” These seven words sum up a damning report today from the National Audit Office (NAO), looking at the early implementation of Universal Credit (UC).

This doesn’t come as great surprise, as earlier this week the new man in charge of delivering UC admitted there had been “missteps along the way”. The findings are, however, deeply concerning as Universal Credit marks a major reform to the welfare system that will ultimately touch the lives of around 10 million families. If it is not properly designed and implemented, it is the worst-off people who will suffer.

JRF research has also raised a number of concerns about the delivery of UC. These include the decision to move to monthly benefit payments, posing a significant challenge for some low-income families; the ‘digital by default’ claims process; and the lack of clarity about the transitional support that will be on offer as people are moved from one system to the other. A review of the evidence also questions whether the tougher sanctions regime will deliver the desired outcomes, as people who are sanctioned are more likely to drop out of the benefit system altogether or take particularly poorly paid and unstable work that sees them very quickly back on out-of-work benefits.

You could argue that these are simply problems of delivery and process that can be rectified. But they have the effect of undermining confidence in what is, in theory, the right idea. UC is founded on the principles of a simpler system that is easier to navigate, that smooths the transitions in and out of work and makes sure it always pays to work. This is in contrast to the current system, which is confusing and unreliable, and makes taking what is often low-paid and insecure work too big a risk for many people.

But UC is in danger of not even managing to live up to the core goal of ensuring it always pays to work more. Our research published in the summer found lone parents and second earners could be worse off working full time than when they worked part time.

Poor implementation and a design that doesn’t live up to the principles of UC are in serious danger of undermining what is, at heart, a good idea. Listening to the media interviews this morning it seems that the Department for Work and Pensions accepts much of the criticism set out by the NAO.

What we need to see now is a new plan and a realistic timetable for the delivery of UC. This is a reform that needs to be put on the right track, not abandoned.

Read more about our work on The impact of Universal Credit