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MPs to quiz Iain Duncan Smith over Universal Credit delays Duncan Smith defends Universal Credit from growing criticism
(about 2 hours later)
Problems surrounding the implementation of a central pillar of government changes to the welfare system are to be examined by MPs. Iain Duncan Smith has rejected claims his flagship welfare policy will miss key targets and insisted the IT system underpinning it "seems to be fine".
Work and Pensions Secretary Iain Duncan Smith will be asked to explain why the new Universal Credit will not be paid to about 700,000 people until after a planned 2017 deadline. The work and pensions secretary said he had "never been specific" about the number of people expected to move onto Universal Credit before 2015.
The Work and Pensions Select Committee will also ask about IT system problems. Labour claims only a fraction of those planned will be transferred on time.
Ministers have said the initial roll-out was a success. Mr Duncan Smith said changes had been made to protect the most vulnerable and ensure the technology works properly.
Mr Duncan Smith told the Work and Pensions Select Committee in July and the Commons in September that the 2017 plan remained in place. Universal Credit will merge six working-age benefits - income-based jobseeker's allowance, income-related employment and support allowance, income support, child tax credit, working tax credit and housing benefit - into a single payment in a far-reaching change designed to encourage work incentives and to reduce fraud.
'Total failure' The project has been beset by problems since it began in 2010 and Mr Duncan Smith, who will be questioned by MPs on the work and pensions committee later, acknowledged on Thursday that Universal Credit will not be paid to about 700,000 people until after a planned 2017 deadline.
But he has now said some people receiving Employment Support Allowance may not be transferred in time. 'Original plan'
Both Mr Duncan Smith and the official in charge of the project, Howard Shiplee, will give evidence to the committee. Labour has claimed the £2bn project is "in tatters", citing figures in last week's Autumn Statement that only a handful of people will be claiming Universal Credit next year and figures for 2015-6 will be about 400,000 compared with initial expectations of 4.5 million.
Universal Credit merges six working-age benefits - income-based jobseeker's allowance, income-related employment and support allowance, income support, child tax credit, working tax credit and housing benefit - into a single payment. But Mr Duncan Smith told BBC Radio 4's Today programme that the project - which he insists will deliver £38bn of long-term economic benefits - was on track and the "vast, vast majority" would be claiming the benefit by 2017.
Labour said official figures showed only a tiny fraction of the numbers due to be using the new system by the time of the next general election in 2015 would be transferred on time. "It is on budget and 6.5 million people will be on the system by the end of 2017," he said.
Shadow work and pensions secretary Rachel Reeves accused Mr Duncan Smith and Prime Minister David Cameron of "a total failure of leadership". "Some 6.5 million people, all of those who have a job requirement on them - which is the key to Universal Credit - all the benefits that are relevant to Universal Credit will be on."
She said Labour, which agrees in principle with Universal Credit, had repeatedly told Mr Duncan Smith it was clear the project was in "disarray" and called for cross-party talks to try to get it back on track. Currently about 2,000 people are claiming the single benefit in a series of "pathfinder" pilots.
The offer was rebuffed and Labour had set up its own group to look at how to implement the project should they come into power at the next general election, she told BBC Radio 4's Today programme. Mr Duncan Smith said he "disagreed" with claims that targets for the next two years would be missed, suggesting that he and his officials had "never actually been specific" about intermediate milestones.
"We never really wanted to dwell on figures because they move and change but I do accept, of course, that this plan is different from the original plan."
Learning lessons
He said he had accepted that it was right to stagger the programme, so that those people receiving Employment Support Allowance would only be transferred after 2017.
"We have been urged to do this by the committee and a number of others who have said 'look it's fair to get the most vulnerable more slowly and not to fix them in to meet a timetable'. That's fine. I agree with that."
The project was "reset" earlier this year following a review by infrastructure and IT experts from the Cabinet Office and amid criticism of poor leadership by civil servants at the Department for Work and Pensions.
The DWP is expected to confirm how much of the initial investment in IT equipment is likely to be written off - meaning that it will have no long-term commercial value.
Mr Duncan Smith insisted the IT system being used to roll out Universal Credit "seems to be absolutely fine" following recent tests and that it was right to get the system fully operational before pressing ahead.
"The lesson we learnt from the roll-out of tax credits by the last government, where they put huge volumes through early on and the whole system crashed costing £30bn in fraud, that was the lesson I was very certain we needed to learn and not repeat and we won't be repeating that this way," he added.
The Government's Digital Service would oversee testing of the system, he added, to see how it "behaves" for different types of claimants before large numbers of people were migrated onto the new benefit.
"We believe it will work and they believe it will work," he insisted, adding that in the longer-term the system could be delivered entirely digitally through mobile phones and tablets.
"No-one had been affected by this so far," he added. "What we are going to do is to set a system so the system works first. "
'Complete mess'
But shadow work and pensions secretary Rachel Reeves accused Mr Duncan Smith of "a total failure of leadership", saying the opposition's call for cross-party talks on the issue had been rebuffed.
"David Cameron and Iain Duncan Smith repeatedly promised to deliver their flagship policy, Universal Credit, 'on time and within budget'. That claim, and the credibility they staked on it, now lie in tatters."
"Eight months ago the prediction was that 1.7 million people would be receiving Universal Credit in 2013, now they admit next to nobody will be receiving it.
"They have been forced to admit that they have completely missed their targets and Universal Credit will not now be rolled out before the election."
"David Cameron and Iain Duncan Smith are presiding over a complete mess and it is taxpayers who are picking up the bill with at least one hundred million pounds of their money written off."