Should Theresa May halt the roll-out of universal credit?
Even the best-laid plans of Whitehall run into problems when they come into contact with the messy reality of people’s lives. Nobody would accuse the beleaguered Universal Credit scheme of being Whitehall’s finest project, and it is no surprise that it is running into serious problems already.
There are currently 530,000 people who have been moved on to the new system, and research from Citizen’s Advice makes it clear that it has been far from a smooth transition.
The problem is the huge wait between payments when people make the switch, leaving 39 per cent waiting up to six weeks, and over half having to borrow money to make ends meet.
Experts say that continuing the full rollout would be “like jumping off a cliff” and it would be the poorest who hit the ground the hardest.
Theresa May talks a good game about helping those with least. Now it’s time to show she means it, step back from the cliff, and hit pause on Universal Credit until these problems are sorted.
Universal Credit is a good idea. Before Iain Duncan Smith announced much-needed welfare reform, the system was a mess. It was too complicated, with more than 50 different benefits.
It was – and still is – poorly administered, with thousands of pages of guidance and fraud and error costing taxpayers billions each year. And it meant those in work were financially penalised, facing sky-high effective marginal tax and benefit withdrawal rates – sometimes 95.5 per cent.
There are reports of people facing stressful situations in which they are awaiting payments and as a result are having to access emergency loans. That needs to be addressed immediately – it’s crucial that those who need support get it. These issues seem to have root in the IT systems, which is yet another example of a badly managed government project. Again, given what is at stake, it is vital to fix those problems as soon as is practically possible.
But rather than halting Universal Credit, we should instead be talking about other ways to simplify the system.