The Labour Party has called for a “hard-headed” review of the coalition government’s flagship welfare reform, Universal Credit, following the publication of an independent report today (23 June 2014).
The Universal Credit Rescue Committee was asked by Labour to explore ways of rescuing the government’s “mismanagement” in delivering the Universal Credit system and whether the new benefit “is delivering value for money”.
Labour say they support the “principle of Universal Credit, but we will not accept the huge waste and delays which have brought the government’s flagship welfare reform programme shuddering to a halt”.
The damning report (pdf) found that Universal Credit will never be delivered successfully across the country without leaving the new system open to fraud and error. The committee slammed the government for “repeated refusals to provide detailed information” which “makes it almost impossible to assess the current state of the project”.
According to the report, the introduction of Universal Credit risks damaging work incentives and that council tax support should not have been left out of the new system.
Universal Credit also poses a “significant risks for many women” who are often the main carer of a child, because the new system only allows for payments to be made to “one member of a couple”.
“Delays and waste have plagued Universal Credit since its inception”, the independent report says, and that a “culture of secrecy and ‘good news reporting’ within the Department for Work and Pensions” has “hampered effective scrutiny of the project”.
Labour’s shadow secretary of State for Work and Pensions, Rachel Reeves said:
“Universal Credit is in crisis. Mismanagement by incompetent ministers has wasted millions of pounds of taxpayer’s money and caused huge delays to this £12.8 billion programme.
“A Labour government will conduct an urgent review of waste, mismanagement and whether Universal Credit is delivering value for money. And we’ll call in the National Audit Office to make sure the review’s conclusions are robust.
“Labour’s review will lead to hard-headed decisions about whether Universal Credit can be rescued.
“If Universal Credit goes ahead we will make major changes to help families and businesses by cutting red tape for the self-employed and making payments of benefits for children to the person who is caring for them, not just the main earner. These changes that will be funded from within the existing budget.
“Labour supports the principle of Universal Credit, but we will not accept the huge waste and delays which have brought the government’s flagship welfare reform programme shuddering to a halt.”
Cllr Kieran Quinn, Leader of Tameside Council, Chair of the Universal Credit Rescue Committee said:
“This government tries to talk tough about welfare reform but the facts are clear they have failed at every key milestone to make work pay and support people into work.
“Universal Credit was rolled out late, millions of pounds in set up costs have had to be written off and it has continually been beset with IT problems.
“By now over 1 million people should have been moved onto this new benefit but so far only 6000 people have completed the process. A failure by any standards.
“Because this government have no idea what’s gone wrong with Universal Credit they have no understanding of what needs to change to make it work.
“The rescue committee’s work programme has looked into every aspect of Universal Credit and made clear recommendations that should help inform any review implemented by an incoming Labour government.
“Helping to get this key benefit back on track, will ensure that work pays and the journey into work is simpler and more successful.”
Iain Duncan Smith’s Universal Credit has been beset with delays and added costs since the Work and Pensions Secretary introduced the policy as part of widespread changes to the welfare system.
The DWP’s 2013 annual review revealed that £40 million in IT costs had been written off and that this figure could increase by a further £90 million over five years.
Labour’s call may satisfy some critics but others are demanding that Universal Credit be scrapped and that its architect, Iain Duncan Smith MP, be removed from his position as Work and Pensions Secretary.