Progress | Centre-left Labour politics

Labour must expose serious failings behind universal credit

The evolution of universal credit from a radical change in the social contract to a means to reach Tory savings targets has been extraordinary. We were told that this ‘once in a generation scheme’ would make work pay and transform the lives of millions. However, it has been dogged by implementation blunders and a clear lack of departmental oversight. The plans have now attracted the attention of the chancellor as he battles to achieve the welfare cuts promised in the Conservative manifesto following his tax credits U-turn.

If it genuinely offered benefit claimants a much-needed route into full-time employment, then universal credit would be worth considering, as Labour politicians recognised from the scheme’s inception. The truth, however, is that the rationale behind the scheme is shaky and every pilot reveals problems that are in need of far more than a sticking plaster.

In my own local authority, where universal credit is currently open to single claimants, the evidence shows that 95 per cent of recipients head straight into arrears and more than half are hit by severe delays during the change. It was also apparent that the support from the Department for Work and Pensions and the local job centres is simply not able to find the jobs necessary to make up for the financial shortfall. A similar issue has emerged in North-east Lincolnshire, where the DWP’s mapping was out by 150 per cent and neither the local authority – or the Citizens’ Advice Bureau – can provide the crucial work coaches due to the government’s incompetence.

Other pilots, such as the one in Ashton-under-Lyne, reveal serious problems with the transitional arrangements. The beleaguered work and pensions secretary, Iain Duncan Smith, earmarked a £69m support fund to tackle the problems associated with universal credit, but DWP officials have subsequently admitted that this money will be spent on several other ‘departmental priorities’ as well.

The haste with which the government intends to implement these proposals – Duncan Smith indicated he wants to introduce universal credit nationwide from April 2017 – suggests it is not serious about dealing with the difficulties those on benefits will face. Never mind that councils and housing associations are still concerned about not having enough information to steer people through the transition, or that the information given to individual claimants at the beginning of their transition is simply not clear enough.

The fundamental problem remains that the scheme is no longer going to achieve its grandiose goals. George Osborne told Andrew Marr in November, shortly after his tax credit reversal, that he had cut £3bn from universal credit and the Institute for Fiscal Studies has bluntly revealed that the project is merely now about saving more money. What this means in practice is that 2.6 million families are set to lose £1,600 a year through the transition.

The impact on those in greatest need of support will be severe. Labour’s own research suggests that a total of 5.5 million working parents will lose £950 per year and the disabled, according to statistics from Liverpool Economics, could lose up to £2,000 a year. Labour’s opposition day debate on universal credit last week showed a willingness to forensically examine the flaws in the scheme and the fact that 20 Tory members of parliament voted against the tax credit changes showed that Conservative parliamentarians are willing to disobey their government when presented with empirical evidence that their cuts will lead to greater hardship. Labour must continue to expose the serious failings behind universal credit and hold the discredited DWP to account on behalf of those whose benefit struggles seem set to go on and on.


Daniel Crawford is a councillor in the London borough of Ealing. He tweets @DanCrawford85


Photo: Andrew_Writer

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Daniel Crawford

is a councillor in the London borough of Ealing


  • I completely agree that this is a huge potential area of weakness for the Tories. Cutting support to working families totally undermines their claim to be the “party of working people”, yet if they back down over the cuts (as they did over tax credits) then Osborne’s fiscal targets will be in tatters.

    However, we need to be careful. Cutting welfare spending to those out of work is – rightly or wrongly – popular. One of the things that did for us at the last election was the perception that we were taking hard-working taxpayers money and giving it away to people who didn’t necessarily deserve it. Just saying “don’t cut benefits” isn’t enough. We need a coherent alternative to the Tory plans that is seen to be fair to everyone.

    Personally I think we should move closer to what I think IDS’s original vision was before it was turned into a slash and burn money saving exercise by Osborne, i.e. genuinely encouraging those who are out of work, back into employment. At the moment, job centre staff are motivated by trying to deny claimants as much money as they can, rather than by actually helping them find a job. Despite the fact that getting more people into work would ultimately save the Treasury more money than sanctioning benefits.

    Properly trained and genuinely helpful job centre staff are more essential than ever. Technology and globalisation are destroying existing jobs, but creating new ones at the same time and there are a lot of people who need some support to guide them to find those new opportunities – rather than just being financially being beaten up every other week over technicalities. We should be able to demonstrate that this is a win-win for everyone, for the taxpayer who no longer has to support the unemployed, and those who are unemployed who can be helped to find a job.

  • But we cant just merry along supporting Family Credit which has subsidised employers and lowered wages or Housing Benefit which is subsidising excess profits for private landlords. As well as opposing Universal Credit, have to think something new – i thank you

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