The past week’s whirlwind of critique of Universal Credit is quite overwhelming because it brings together so many different kinds of problem, each with a large impact on the lives of low income families. Some are to do with delays people have already experienced by new claimants and the huge suffering that will cause if existing claimants are ‘migrated’ onto UC by being forced to reapply for benefits. Some is to do with the large number of significant losers being created by UC entitlements – contrary to the original design which was claimed to create mainly winners. And a lot is to do with the world waking up to the impact of severe cuts affecting benefits, tax credits and UC, such as the failure to uprate them with inflation and the two-child limit.
Out of this depressing list, the toughest question now emerging is whether there is a case for abandoning Universal Credit entirely. There are two main arguments against this. The first is that it would just cause further chaos. The second that it is still possible to achieve the original advantages of UC, if only it were implemented in a different way.
The first argument, that you’re too far down the road to reverse this policy now, becomes weaker as the road itself seems to extend ever further into the distance. It’s just emerged that a full ‘migration’ of existing claimants onto UC will now start in ‘November 2020 at the earliest’. That’s ten years to the month since the policy was announced in a white paper. It’s all very fine the government making a virtue of a ‘cautious’ schedule for implementation, but its constant revision of this schedule raises the obvious question of whether there’ll ever be a time when people can be moved onto this benefit without severe risks, while in the meantime thousands of new claimants are already feeling battered by the system. And the coherent case made last week by the Resolution Foundation’s Torsten Bell that any incoming Labour Government will inherit a system with millions on UC is starting to look much less clear-cut, whenever you think the next election will occur.
So the case for a ‘pause and review’ for UC, with all options on the table, becomes stronger by the day. Such a review would need to look at the second and even bigger issue of whether major changes to UC could still produce its claimed advantages, including a more seamless and responsive system for claiming working-age benefits, which would encourage greater take-up and improve work incentives. Some say that the very fundamentals of UC, with its monthly payments and online, real-time system for adjusting them, were always flawed. But would it really be impossible to adapt such a system to make it supportive rather than hostile to the claimant? When Gordon Brown’s tax credits created a serious problem of having to repay overpayments incurred after people’s earnings changed, he responded by making it much more supportive to people in such situations, disregarding the first £25,000 of increase in earnings from one year to the next. Among improvements to UC, one might envisage ‘run-on’ periods under which reassessments that caused reductions were not implemented instantly, but only after a period that ensured people were not left short. Similarly, emergency payments when people first apply could be far better designed to support those in dire need, without saddling them with debt to repay later.
In other words, the key question is whether Universal Credit applied with greater generosity of cash and spirit could be made to work properly. I don’t know the answer to this question, but it at least needs to be seriously examined, as does the question of what new administrative problems might be caused by moving people on UC back onto tax credits. We can’t let revulsion at the cruel way that the system is presently being applied cause a rush into a reversal that, hastily applied, could yet create new cruelties of its own.