The RSA uses cookies on this website. By using this website you are agreeing to our use of cookies. To find out more read our cookie policy and privacy policy. More Info

Universal Credit – enough is enough

Blog 12 Comments

  • Future of Work
  • Employment
  • Behaviour change
  • Health & wellbeing

The claims made for Universal Credit– cost effectiveness, impact on employment, simplicity - have no evidence behind them. Its introduction has been a disaster across the board, argues Anthony Painter.

Universal Credit is but one part of a three-pronged approach to welfare reform. The other two are the extension of hard conditionality in the form of sanctions on the basis that work is all you need for economic security. The third is cuts to levels of payment with some groups, the most vulnerable such as those with long term sickness and disabilities amongst them, bearing the brunt of cuts.

This is where I drop traditional English reserve. Taken together this package of welfare reform has left a system that is cruel, punishing, bureaucratic, authoritarian, ineffective, undermining of good work, and of caring, personal development, family harmony, and public health – most particularly mental health. This system is a national scandal; it must be stopped not just patched up and as soon as possible. It has left us a society utterly morally degraded and, in many ways, repugnant. We should be ashamed of what we have done.

Why ‘we’, surely it’s the Government? Without wishing to absolve successive Governments of any blame whatsoever, we as a society have to bear responsibility too. For too long we have allowed the myth that poverty is caused primarily by character to be perpetuated. Cod science has even been used in defence of this standpoint as Atif Shafique brilliantly set out in an RSA blog last week. But we’ve been willing to drift into the lazy assumption that all that matters is a job and if you don’t have a job then there’s something suspect about you. Welfare, therefore, should not be a support, a platform of security, rather it should be a corrective.

Here we are, a quarter of a century of welfare reform later, with more in work poverty than out of work poverty, mass harm perpetuated by a punishing welfare system, and the state extended into every nook and cranny of the lives of those who are poor or destitute.

Lest you think this is just the outpourings of an angry critic of the current system – though angry as charged, why would you not be? -  it is worth dwelling on the evidence that has been published in the past fortnight. Astream of conclusive evidence observed over several years has become a torrent in recent weeks. Firstly, a multi-university five-year study into welfare conditionality found that there was little evidence on any impact on motivation to work, many were pushed into destitution, ‘survival crime’, and ill health, and conditionality had triggered negative personal, financial, and health problems. Support programmes were found to be weak which is little wonder given the behavioural premises on which the system has been constructed- why put in place decent programmes when you can carry a big stick instead?

And last week, the Joseph Rowntree Foundation produced evidence that further backed up these findings. It discovered that 1.5million people, in the world’s fifth largest economy, were ‘destitute’. And, by the way, the Trussell Trust has shown that where Universal Credit has been introduced there has been a thirty percent surge in use of food banks. The Department for Work and Pensions denied this. This National Audit Office today backed the Trussell Trust over the Department for Work and Pensions.

And the final blow to the current system was dealt today – by the National Audit Office. The costs are far higher than forecast, the impacts on individuals in terms of indebtedness, rent arrears, and destitution clear, and far from simplicity, the system is excruciatingly complex. And this is where you end up when a Government ministry embarks on a mass campaign of interventionist individual behaviour change. Universal Credit is bad because the values on which it was built are rotten, the implementation was rotten, and the impacts are predictably rotten.

This course was set in the 1990s, extended under the Labour Government and then accelerated under the Conservative-Liberal Democrat Coalition and now the Conservatives governing alone. In other words, every governing UK party has its fingerprints on the current welfare state. Quarter of a century ago we took a slow then sharper turn into a cul-de-sac. And that is now where we are – the clutch is disengaged but the foot pushes the accelerator to floor, smoke is pouring out of the exhaust.

The failure of a quarter century of reform is almost too big to comprehend. Caution amongst anti-poverty campaigners, think tanks, the media, and political parties in insisting on a fundamental change of direction is understandable. Path dependencies are ingrained and the scale of the challenge incredible. Universal Credit and the wider system of which it is a part is not going to be replaced overnight and therefore short-term mitigating measures will be needed. But there is an enormous risk to this approach without a case for more fundamental change alongside. This risk is that technical reforms do just enough to hide the scandal from view without resolving the fundamental issues.

Whilst short term changes are important and necessary, there should be greater boldness from those who can see the corrosive impacts. There now needs to be a determination to replace Universal Credit and the entire assumptions on which the wider system was built. Rather than a system based on managing caricatured individual behaviours creating new insecurities as it operates, the system should instead be based on ensuring a bedrock of economic security for all. Conditional, means-tested systems cannot achieve that. And that should be step one of a now urgent response – to call for a system based on a fundamental level of economic security. And then the real change can begin.

Immediately, the roll out of Universal Credit should be suspended. Those who have ended up in debt or rent arrears should be compensated. Conditionality should be softened pending a full evidence review into conditionality and the culture and actions of Job Centre Plus. This review should be free to recommend the end of conditionality and, should the culture of Job Centre Plus be seen to be irreversible in a reasonable time frame, the replacement of it with an agency tasked with promoting economic security and support could be recommended.

Alongside this review, there should be a full independent inquiry into how this debacle happened with a view to laying out how to avoid it once again as the welfare system is replaced. This inquiry would provide lessons for wider public policy. In tandem, experimentation in how support for individuals and families could operate differently should be widened. Hillary Cottam has some intriguing ideas for how relational, civic welfare could work, explored in her new book, Radical Help. New support measures must rest on a firm base. Reforms to how we provide cash support need to be explored. A Basic Income, grounded in economic security as a fundamental, unconditional level of support, should be understood more deeply. The Scottish Government has sensibly funded feasibility studies into Basic Income pilots. The rest of the UK should be supported in doing so also.

Finally, a Commission should be established to recommend options for the replacement of the current welfare system over the course of decade and a half (welfare reform takes time). It should be tasked, amongst other things, with exploring possible pathways to a Universal Basic Income. The RSA has suggested what one of these pathways might be. That would be but one element of change. The whole system including support for housing, disability, child care, and into and in work support should be considered. A whole system reform is now necessary.

As the original Beveridge report stated: “A revolutionary moment in the world’s history is a time for revolutions, not for patching.” As we embark on the 2020s - a likely decade of disruption as society ages, technology spreads, the world of work restructures, and Brexit takes hold – we already face chronic and acute economic insecurity. And here we are grappling with a monumentally failing system. This national scandal can be pivoted into deep and profound progressive change. Let’s not turn away.

Join the discussion

12 Comments

Please login to post a comment or reply

Don't have an account? Click here to register.

  • I agree wholeheartedly with your criticisms Anthony.  If you had been following the Facebook group on Universal Credit and the Self-Employed you would probably conclude that you are being far too emollient and reserved even so....  but your remedy is asking for nothing less than a political revolution (and I don't mean figuratively).  


    An exceedingly simple and easy reform to implement would be to just repeal conditionality.  


    The University study you cite makes it pretty clear that conditionality is almost completely ineffective and seriously harmful.  Conditionality applied to self-employment is the the mechanism of the Minimum Income Floor and it is catastrophic.  One affected person today said, "I feel like giving up on self-employment and just engaging in utterly pointless job search in order to get full rate Universal Credit."   

    Such a powerful disincentive to initiative and self-help is disastrous and the precise opposite of that Universal Credit was supposed to provide.

    Scrap conditionality and restore most of the allowances back to prior to George Osborne's last budget and the scheme could still live up to its higher aspirations.

     

  • Oh, Anthony how I wish you were wrong, and there was no need to write this article. It represents a failure on so many levels. This outcome was predicted to occur by those who understand complex systems and how to design them.
    Looking at this systemically, and in the wider context of helping people in need, you are so right that we have hardly moved on from three decades ago. We would re-assess the principles and approaches that are causing the same outcomes. I see this root cause as primarily short term decisions driven by politicians. I dont blame politicians, how can they assess and agree such complexity? The solution here would be a cross party decision-making mechanism that would help govern nd define strategy - with access to experts who can help politicians to work on a long term plan.
    Then looking at other similar and complex problems - the central emergency control rooms, the NHS unified customer system.  Both of these were also predicted to fail because of the same causes.
    The solution is for several things to be in place:
    - Any serious idea like these is first analysed as a whole system, not as a technical solution. The NHS system is about communication patients information - not an IT problem.
    - Variation and value must be part of the analysis. Highly variable systems like universal credit cannot be simply regarded as transactional systems.
    - A complex new approach has to be gradually developed, in modules. Allowing learning to inform further development. There may come a time when the project reaches conclusion because partial completion of key modules is sufficient to achieve outcomes and further digitalisation is the wrong thing to do.

    - Stop believing that everything that can be digitalised should be digitalised. A dangerous mentality. Highly variable systems, involving the complexity of people, families, their needs and issues, are not just complex, they are often uncertain and impossible to define.

    Can this be a watershed moment., to galvanise those who can advise and have knowledge, to get together and design solutions for some of these fundamental problems?  The people of this country who are in need, deserve far better. We know what needs doing, many pilots and case studies have illuminated solutions. It just needs the right kind of leadership. Why should those least able, have to suffer in this way, AND pay for austerity? Something is very wrong.