Universal Credit MUST fail

Cameron says Universal Credit will fail!

A headline easy to write after Sue Cameron in the Daily Telegraph said it will fail and specifically there isn’t a hope in hells chance of the IT working or on time.

What the Telegraph didn’t write is that even in theory Universal Credit is bound to fail as no government could ever afford it.  There is a fundamental flaw in UC that its creator Iain Duncan Smith, who funded and started the think-tank that came up with it, must know.

Very simply UC is a one-stop assessment for all benefits.  So a one-time IT or perhaps phone-based based interview which assesses the applicant for Income Support, Carers allowance, Employment Support Allowance and every other welfare benefit as well as Housing Benefit and Council Tax Benefit.

If such as system could work then what a great idea you might think?  Massively reduced administration costs and every claimant getting what and only what they are entitled to!  Even setting aside teething troubles as all new systems have the idea is so good.  Yet it is so incredibly and fundamentally flawed.

In June 2011 the DWP published reports which revealed the take-up of benefits by the general public.  One of these for example stated that the DWP (a) know what percentage this is meaning they know how many are entitled to it, and (b) they know that up to £6.7bn per year of Housing Benefit goes unclaimed.

So the Universal Credit proposal for a one-stop assessment of all benefits would see a massive increase in the total benefits the government would have to pay.   This would see HB payments alone increase by 30% from £22.4bn to £29.1bn overnight. It alone would add increase the overall £192bn benefit bill by 3.5%.  Add on the non take-up of Income Support, ESA and all other benefits and…You get the picture!

The inevitable IT problem Sue Cameron discusses (and the inevitable cost overruns in every large public sector IT development she doesn’t) are frankly inconsequential compared to the massive increase the Universal Credit MUST mean for the overall welfare benefit bill.


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