Universal Credit Still in the Doldrums.
James Bloodworth writes, “Just a fraction of the people the government wants to move to Universal Credit have been put on the new payment system, according to new statistics from the Department for Work & Pensions (DWP).
13,260 people have been moved onto universal credit since it began in April 2013. Of these, 11,070 were still claiming by the end of August 2014.
This means that work and pensions secretary Iain Duncan Smith is 986,740 short of his original target of one million people to be moved to universal credit by April 2014. IDS is also far short of his revised target of 184,000.
The latest statistics show a large disparity in the number of claimants across the country. Oldham, which was one of the original pathfinder sites, had a caseload of 2,240 claimants at the end of August. Meanwhile Birmingham and Rochdale had 10 (see chart). The low number for Rochdale is probably explained by the fact that the system only went live there recently.
A report from the Work and Pensions committee of MPs warned in April of this year that it was still not clear whether the universal credit roll-out would actually work.
“Whilst it is right to ensure that the system works properly before extending it, there is a difference between cautious progress and a snail’s pace,” said committee chair Anne Begg MP.
“Given the excruciatingly slow pace of roll-out to date, it is hard to see how the most recent implementation timetable can be met,” she added.
Given today’s figures from the DWP, the roll-out of universal credit doesn’t appear to have significantly picked up the pace.
More on Left Foot Forward.
This, by David Finch from the important Public Finance bulletin (10th September) , raises wider concerns,
Universal Credit attempts to be a big bang solution to the complexities of the welfare system but new incentive structure could undermine the intended benefits
Despite parties gearing up for the next election and the chancellor already placing further spending cuts to welfare firmly on the table, attention has moved away from the expected impact of Universal Credit on families, and has instead turned to the implementation issues that have dogged it so far.
Cuts in welfare spending have already made Universal Credit less generous than originally envisaged and it is unclear what the impact of Universal Credit will be when it does arrive.
As a paper published today by Resolution Foundation argues, simplification of the benefit system is certainly a positive step. Universal Credit is a radical and big bang approach to dealing with the often confusing complexities of the current benefit system. A single benefit will ease the process of moving into work by removing the need to claim different benefits.
Financial rewards to start work are improved through work allowances (effectively earnings disregards) which mean that the initial earnings of a household, up to 20 hours of work at the minimum wage for a couple with children, are kept before any benefits are withdrawn. Once earnings go beyond this point UC is withdrawn at a single rate of 65p for every additional pound of earnings.
But this new incentive structure creates its own problems. For some, particularly those claiming support with their housing costs, the point at which this allowance runs out is much lower, for a couple with children claiming support with housing costs it is equivalent to working eight hours at minimum wage.
A new regime of in-work conditionality is expected to counter the risk that people who now find it more worthwhile to enter work at a low number of hours get stuck in those jobs. People will be expected to be earning the equivalent of 35 hours at minimum wage or risk having their Universal Credit award reduced.
Finch then states,
“… the radical nature of this system should not be underestimated. Little evidence exists to inform its design which is a huge departure from the current role of Jobcentre Plus. Yet the policy design is still not complete and it is unclear whether the default of an evolved Jobcentre Plus is the correct agency to deliver such support. “
Is this news item related?
Iain Duncan Smith’s department has raked in nearly £120,000 from calls to Government helplines.
Pensioners and redundant workers are among people forced to pay the rip-off phone charges.
Work and Pensions Secretary Mr Smith – already under fire over his discredited Bedroom Tax – may now have to explain why his department still has 0845 numbers for its helplines.
The Government has pledged to stop using the numbers, which cost up to 41p a minute from a mobile phone.
But Labour MP Roger Godsiff has discovered the DWP has made £117,000 during the past five months from the high-rate numbers.
Among the DWP helplines with the 0845 prefix is the Future Pension Centre which gives pension statements and information.
Higher rates are also charged on the Redundancy Payments helpline.
The DWP gets 0.3p per minute from every call to its 0845 numbers, which is then spent on operating other phonelines.
The new system, and the present system, are unfathomably complex and people often ring up the DWP to try to get help.
The benefits system increasingly relies in Call Centres, and we learn they may introduce (as with other government agencies) voice recognition questions.
The application by phone system will be another hurdle for people to jump over.
Remember: we will all end up on Universal Credit….sometime, or Never?
Labour in power could abandon universal credit (19.9.14. Inside Housing)