NAO say Universal Credit could cost more than old benefits system

The National Audit Office (NAO) has issued a report highly critical of the new government flagship welfare system, Universal Credit. The NAO assess that the new single benefit payment could cost more than the old multiple benefits system.

It also said that it is possible we will never know if the stated goal of getting more people into work will ever be achieved.

Unversal Credit (UC) has so far only been rolled out to 10% of benefit claimants and that 25% of new claims were not paid on time or in full. 20% of late payments were actually 5 months or more in arrears.

It should come as no surprise that many landlords mistrust UC and now prefer not to let to tenants claiming it.

Amyas Morse, head of the NAO, said: “The Department has pushed ahead with universal credit in the face of a number of problems, but has shown a lack of regard in failing to understand the hardship faced by some claimants.

“The benefits that it set out to achieve through universal credit, such as increased employment and lower administration costs, are unlikely to be achieved. Yet the Department has little realistic alternative but to continue with the programme and hopefully learn from past mistakes.”

To view the NAO Rolling Out Universal Credit report click here

Report Conclusions:

We think that there is no practical alternative to continuing with Universal Credit. We recognise the determination and single-mindedness with which the Department has driven the programme forward to date, through many problems. However, throughout the introduction of Universal Credit local and national organisations that represent and support claimants have raised a number of issues about the way Universal Credit works in practice. The Department has responded to simple ideas to improve the digital system but defended itself from those that it viewed as being opposed to the policy in principle. It does not accept that Universal Credit has caused hardship among claimants, because it makes advances available, and believes that if claimants take up these opportunities hardship should not occur. This has led it to often dismiss evidence of claimants’ difficulties and hardship instead of working with these bodies to establish an evidence base for what is actually happening. The result has been a dialogue of claim and counter-claim and gives the unhelpful impression of a Department that is unsympathetic to claimants.

The Department has now got a better grip of the programme in many areas. However, we cannot judge the value for money on the current state of programme management alone. Both we, and the Department, doubt it will ever be possible for the Department to measure whether the economic goal of increasing employment has been achieved. This, the extended timescales and the cost of running Universal Credit compared to the benefits it replaces cause us to conclude that the project is not value for money now, and that its future value for money is unproven.

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