John Glen is the Member of Parliament for Salisbury.
In the wake of the Tax Credits debate, it would be extremely easy to be distracted from arguably the most important legacy of a Conservative-led welfare agenda: Universal Credit.
Time and again, well-worn problems with our current welfare system demonstrate that they cannot be solved by tinkering around at the edges of the current system. Listening to representations on benefit delivery, on welfare to work, indeed on tax credits as well, makes the case for radical reform across the benefits system irresistible.
Universal Credit achieves three core aims: making benefits more like being in work (by monthly payments, and getting rid of the distinction between benefits like working tax credits and Jobseeker’s Allowance, removing the need for reapplication); piggy-backing onto PAYE via Real Time Information (which would deal with a vast number of benefit delivery issues that the Work and Pensions Committee has heard about); and benefit simplification (addressing benefit delivery and helping claimants who – quite reasonably – find it extraordinarily difficult to work out what they are entitled to).
The initial results of UC published by DWP today suggests that it is succeeding in these core aims and that, compared with JSA, claimants are much more likely to move into work.
This underlines the importance of getting UC delivered – because it does work.
It is far too easy to be distracted by focusing only on the taper rate (how fast UC gets withdrawn as earned income increases) and the level of the work allowance (how much you can earn before UC gets withdrawn). Whilst it is vital to get these right, the underlying framework of Universal Credit must be delivered. UC was actually designed to enable governments seamlessly to adjust the taper and work allowance rates into the future – for example, to encourage people into work in a recession or to encourage people to increase their hours.
The value of UC does not stand or fall on a 65 per cent taper rate or particular levels of work allowance expected by the Government in any particular year. This reform is about the next decades – not about what short-term budget constraints can allow.
DWP also announced today that UC is now in three quarters of Jobcentres, which is very welcome news and a key milestone for its implementation.
We do need to remember that roll-out of Universal Credit is in modest incremental steps, still waiting to deal with the most complex new claimants and with the digital service rollout further into the future. But as the roll-out of UC confidently continues, there is a case to be made for expanding its remit.
From what we’ve heard on the Work and Pensions Committee about the regional variance in Council Tax Benefit regimes, and the knock-on issues with passported benefits due to the delayed delivery of underlying benefits, benefit simplification must be an imperative which continues well into the future – beyond the basic implementation of UC.
The Government at least hinted, in its response to the March 2012 Social Security Advisory Committee report on passported benefits, that it would consider eventually rolling passported benefits into UC as well – by representing passported benefits as ad hoc discrete allowances within UC to pay for the relevant good (like prescriptions or eyecare). Rolling Council Tax Benefit within UC would also be important to avoid marginal effective tax rates adding up and harming work incentives. The Government must be ambitious and begin to plan for how Universal Credit can adapt to further simplify the benefits system.
Admittedly governments of all stripes do not have an excellent record in undertaking major IT projects. Political timetables and imperatives too often have priority over the practicalities of the rollout of a hugely complex system, leading to write-offs, as in the case of the NHS electronic patient record system which dated from 2002, but which after almost a decade of spiralling costs finally had to be dismantled in 2011. The fact that the Universal Credit timetable has shifted is not a reason to write it off or assume that it will never happen: rather, we have finally learned that getting the project delivered is what really matters. We must give UC the time it needs – whilst getting the relevant scrutiny from the Work and Pensions Committee, the PAC and the NAO – to ensure that it does eventually roll out having learned all we can about the glitches, rather than rushing and botching the implementation.
The Government should not lose heart. Universal Credit is likely to be the most important legacy of a Conservative welfare agenda. We must continue to make sure it arrives – and not lose any of the reforming zeal in the process: there is still more to be done.