Editorial: A prudent start to the ‘welfare revolution’

The final test will be whether universal credit does indeed ‘make work pay’

Share

As of this week, Ashton-under-Lyne’s benefits claimants – or those in uncomplicated circumstances, at least – took their place at the vanguard of Iain Duncan Smith’s overhaul of the welfare system.

For those on universal credit, there will be no jobseeker’s allowance, working tax credit, housing benefit and so on; instead, there will be a single monthly payment, managed through an online account and automatically adjusted according to hours worked.

In abstract, the plan is a good one. The welfare system’s nigh-impenetrable thicket of disbursements, credits and entitlements is at once unwieldy, difficult to navigate and costly to administer. Both the claimant and the state would gain from its being made more responsive and more straightforward.

Yet putting a simple system in place is anything but. First, there is the new technology to consider. Indeed, such are the technical complexities – not least in linking Department for Work and Pensions computers with those of the Revenue – that the universal credit pilots have already been scaled down and the plans for wider implementation delayed.

The Welfare Secretary’s critics deplore the scheme as late, over-budget and in general disarray. There is certainly cause for unease. The long history of government IT failures hardly inspires confidence; and the impact of payments missed or wrongly calculated would be devastating for many claimants. But the tweaks to the timetable should therefore be welcomed, not decried. With so tricky a task, it is surely better to take more time and get it right.

Nor are the logistical hurdles the only challenge. A bigger question is whether the new system will work better for those who use it. True, a single payment will be clearer and more predictable. But the move online will be problematic, at least until IT skills and internet access become ubiquitous even among the poorest and most vulnerable.

The plan for monthly, rather than weekly, payments is also potentially troublesome. Mr Duncan Smith may argue – reasonably enough – that those on benefits are better served by a system that parallels the world of work. Yet someone struggling to make ends meet over a week might come seriously unstuck over a month. The proposal to pay housing benefit to claimants, rather than landlords, raises similar issues: for those with the lowest incomes, it may prove impossible to balance the claims of debts, say, or feeding the family, against the need to pay the rent.

The universal credit may be a commendable shift away from state paternalism, but the risks of a rash of rent defaults, or of families running out of money with weeks to go, cannot be ignored. And although such issues need not be insurmountable over the longer term, the transition will need to be carefully managed.

The final test will be whether the scheme achieves the Government’s aim of “making work pay”. Here, the jury is out. Mr Duncan Smith claims his newly responsive system will ensure that more hours always mean a higher income, regardless of benefit cut-off points and tax credit thresholds. Without any more money to spend, however, the Welfare Secretary can only up the incentives for some by penalising others. The most likely outcome is that more people will work, but for fewer hours. Only a qualified improvement, then, if that.

The benefits system is crying out for reform and universal credit has some potential. But it is neither the panacea that Mr Duncan Smith bills it to be, nor is it guaranteed to deliver, in practice, all that is promised by the theory. Ashton-under-Lyne is a small – justifiably tentative – beginning.

React Now

Latest stories from i100
iJobs Job Widget
iJobs General

Recruitment Genius: Cleaner

£15000 - £16500 per annum: Recruitment Genius: If you've got first class custo...

Recruitment Genius: Mobile Applications Developer / Architect - iOS and Android

Negotiable: Recruitment Genius: This is a great opportunity to join a medium s...

Recruitment Genius: Telesales Account Executive - £40K OTE

£11830 - £40000 per annum: Recruitment Genius: Working in a friendly, sales ta...

Recruitment Genius: Web Designer

£15000 - £27000 per annum: Recruitment Genius: One of the UK's leading web des...

Day In a Page

Read Next
The Pentagon has suggested that, since the campaign started, some 10,000 Isis fighters in Iraq and Syria have been killed  

War with Isis: If the US wants to destroy the group, it will need to train Syrians and Iraqis

David Usborne
David Cameron gives a speech at a Tory party dinner  

In a time of austerity, should Tories be bidding £210,000 for a signed photo of the new Cabinet?

Simon Kelner
Greece debt crisis: What happened to democracy when it’s a case of 'Vote Yes or else'?

'The economic collapse has happened. What is at risk now is democracy...'

If it doesn’t work in Europe, how is it supposed to work in India or the Middle East, asks Robert Fisk
The science of swearing: What lies behind the use of four-letter words?

The science of swearing

What lies behind the use of four-letter words?
The Real Stories of Migrant Britain: Clive fled from Zimbabwe - now it won't have him back

The Real Stories of Migrant Britain

Clive fled from Zimbabwe - now it won’t have him back
Donna Karan is stepping down after 30 years - so who will fill the DKNY creator's boots?

Who will fill Donna Karan's boots?

The designer is stepping down as Chief Designer of DKNY after 30 years. Alexander Fury looks back at the career of 'America's Chanel'
10 best statement lightbulbs

10 best statement lightbulbs

Dare to bare with some out-of-the-ordinary illumination
Dustin Brown: Who is the tennis player who knocked Rafael Nadal out of Wimbeldon 2015?

Dustin Brown

Who is the German player that knocked Nadal out of Wimbeldon 2015?
Wimbledon 2015: Nick Bollettieri - It's time for big John Isner to produce the goods to go with his thumping serve

Nick Bollettieri's Wimbledon Files

It's time for big John Isner to produce the goods to go with his thumping serve
Tour de France 2015: Twins Simon and Adam Yates have a mountain to climb during Tour of duty

Twins have a mountain to climb during Tour of duty

Yates brothers will target the steepest sections in bid to win a stage in France
John Palmer: 'Goldfinger' of British crime was murdered, say police

Murder of the Brink’s-MAT mastermind

'Goldfinger' of British crime's life ended in a blaze of bullets, say police
Forget little green men - aliens will look like humans, says Cambridge University evolution expert

Forget little green men

Leading evolutionary biologist says aliens will look like humans
The Real Stories of Migrant Britain: An Algerian scientist adjusts to life working in a kebab shop

The Real Stories of Migrant Britain

An Algerian scientist struggles to adjust to her new life working in a Scottish kebab shop
Bodyworlds museum: Dr Gunther von Hagens has battled legal threats, Parkinson's disease, and the threat of bankruptcy

Dying dream of Doctor Death

Dr Gunther von Hagens has battled legal threats, Parkinson's disease, and the threat of bankruptcy
UK heatwave: Temperature reaches 39.8 degrees on Central Line - the sweatiest place in London

39.8 degrees recorded on Tube

There's hot (London) and too damn hot (the Underground). Simon Usborne braved the Central line to discover what its passengers suffer
Kitchens go hi-tech: From robot chefs to recipe-shopping apps, computerised cooking is coming

Computerised cooking is coming

From apps that automatically make shopping lists from your recipe books to smart ovens and robot chefs, Kevin Maney rounds up innovations to make your mouth water
Jessie Cave interview: The Harry Potter star has published a feminist collection of cartoons

Jessie Cave's feminist cartoons

The Harry Potter star tells Alice Jones how a one-night stand changed her life