Criticisms of Universal Credit: How has the government responded?

Posted in: UK politics, Universal Credit, Welfare and social security

Fran Bennett is a Senior Research Fellow in the Department of Social Policy and Intervention at the University of Oxford, and a Visiting Fellow at the University of Bath Institute for Policy Research (IPR). Jane Millar is Professor of Social Policy at IPR. Alongside Marsha Wood and Dr Rita Griffiths, Fran and Jane are currently working on a three-year ESRC-funded research project, ‘Couples balancing work, money and care: exploring the shifting landscape under Universal Credit’.

Universal Credit has been subject to many criticisms, both before and after roll out began in 2013. The range of responses by the UK government shows an interesting mix of tactics to counter this, some of which have been more successful than others.

Early in the roll out, the problems of implementation posed the real possibility that Universal Credit might be scrapped altogether. One initial reaction by the Department for Work and Pensions (DWP) was to close ranks and become defensive, often refusing to engage with outside organisations or to give independent researchers access to Jobcentres to investigate what was going on. It was only after the National Audit Office and Select Committees had suggested this response was counter-productive that it began to change.

However, in the meantime, to combat the serious reputational damage that Universal Credit was beginning to suffer with claimants, would-be claimants and the public, the government also conducted a public relations exercise, to combat the fear of Universal Credit and try to salvage its reputation. Several editions of the Metro newspaper were taken over by the DWP in 2019 to promote positive news stories about Universal Credit, in order to dispel the ‘myths’ - until the Advertising Standards Authority ordered it to stop. Television programme arrangements were entered into by the DWP with similar aims. Here it is perhaps worth recalling philosopher Onora O’Neill’s suggestion that increasing trustworthiness is a more appropriate goal than trying to increase public trust.

When Universal Credit was attacked, ministers were particularly likely to mount a defence of it as being ‘personalised’, and therefore an improvement on the ‘one size fits all’ legacy benefits system. One former Secretary of State, Esther McVey, argued that it was personalised as well as digitised; another, Amber Rudd, also described Universal Credit as personalised. This description belies the emphasis in Universal Credit on standardised procedures and digitised processes. And the points made by Amber Rudd largely refer not to the claiming process itself but instead to the role of work coaches in managing Universal Credit conditionality. But the degree of personalisation in employment support seems to vary in practice, and is likely to depend on a work coach’s caseload. Those still claiming the equivalent legacy benefits with work conditionality attached will also be likely to have similar interactions with a work coach.

The difference in the Universal Credit system is instead that there is far higher reliance on discretion. Some might argue that this allows flexibility; but equally it may be seen as permitting unfair treatment. Work-related requirements can be waived for lone parents; but this is now contained only in guidance, rather than in regulations as before, so allowances may not always be made. The rate of sanctioning of Universal Credit claimants was as high as 8.5 per cent in March 2018, for example, but fell to 2.3 per cent in August 2019; it is unlikely that claimant behaviour, rather than Jobcentre practice, changed to this extent. In addition, whilst discretion at the margins of entitlement can have positive impacts, in order to do so it must be built on the basis of a framework of fundamental rights and rules, rather than form the core of policy and practice.

Another, more innovative, response by the government to criticisms of Universal Credit has been to attempt to rely on the commercial sector to resolve problems identified. Initially, for example, it suggested that the banking sector might be able to help claimants budget, once they were deprived of the labelling of benefits and more frequent payments in the legacy system, and instead had to cope with one monthly indistinguishable payment.

But it became clear that the so-called ‘jamjar accounts’ - that could divide up a monthly lump sum paid into an account into different pockets - would be far too costly for claimants to afford without subsidy; and the government was only willing to promise one year’s subsidy to the banks.

This did not stop the DWP from trying external solutions again. In recent court cases about the timing of wages payments not matching the automated calculation for Universal Credit, the DWP argued that employers might modify their salary payment schemes in order to accommodate claimants’ monthly assessment periods.

So far, these attempts to involve commercial partners in solving Universal Credit problems seem to have failed. The same cannot be said, however, for outsourcing to others. For example, the government could be argued to be managing the costs of coping with so-called ‘edge cases’ - the casualties of the emphasis on digitalisation in Universal Credit - by outsourcing these. This includes those costs borne by the families and friends of claimants, as well as by a range of third sector organisations, who may be asked to help with problems with the online claim form. The 2018 survey of claimants found that a fifth of them needed help to complete their Universal Credit claim online.

The government’s first port of call for more organised forms of support of this kind, with funding attached, was local authorities, via Universal Support; but this was superseded from April 2019 by Help to Claim, run by Citizens Advice and Citizens Advice Scotland. This funding only covers help up to the time of the first Universal Credit payment, however - although Citizens Advice, like many advice agencies, may nonetheless continue to provide support after the initial assessment period. This service will be put out to competitive tender from 2021.

The latest attempt by the UK government to rehabilitate Universal Credit is through highlighting its role in the COVID-19 pandemic. Given the lack of an adequate social insurance system in the UK, alternative arrangements such as the Coronavirus Job Retention Scheme and the Self-employment Income Support Scheme had to be rapidly deployed. But the centrepiece of the safety net has been Universal Credit, which the government has urged people to apply for if they need to, and which it has increased by some £20 per week, at least temporarily. It has denounced so-called ‘scaremongering’ about Universal Credit and lauded the ability of automation to deliver benefit in full and on time to a substantial proportion of claimants. But, as the author of a recent report for Z2K pointed out, getting Universal Credit to high numbers of claimants is not the same as saying that it is working well for all those who claim.

It is true to say that there are now much closer relationships between the DWP and stakeholders working on Universal Credit, with regular meetings being held to discuss issues of common concern, and more information being made available. These arrangements are much more likely to lead to an open exchange of views and, where possible, to closer collaboration on remedies.

This does not mean, however, that the basic structure and fundamental design of Universal Credit are likely to change – indeed, the current Secretary of State emphasises that its ‘underlying principles … have not gone away’. It is highly unlikely therefore that any of the tactics adopted to date by the UK government in response to criticisms of Universal Credit will be sufficient to address the core problems underlying these, which are precisely this basic structure and this fundamental design.

All articles posted on this blog give the views of the author(s), and not the position of the IPR, nor of the University of Bath.

Learn more about the project, ‘Couples balancing work, money and care: exploring the shifting landscape under Universal Credit’, and read the report ‘Uncharted territory: Universal Credit, couples and money’.

Posted in: UK politics, Universal Credit, Welfare and social security


  • (we won't publish this)

Write a response