Does this Government know what it’s doing?

This is, unusually for this wording, a genuine question.

There’s a general, professional, political and academic, consensus that the White Paper was rushed, incomplete and not thought through.  There are a number of technical design flaws in the little detail that was included and much of the missing detail is yet to be decided.

But, worse than this, in the past week or two, the sound of backpedalling, bell-ringing and squeaky brakes has been getting louder and louder.

The mutterings are that Council Tax will be brought back in to Universal Credit after local authorities pointed out the difficulties that ‘localism’ would bring.

Then the mortgage industry rejected government suggestions that it would make things much easier all round if lenders made interest rates, for those on benefits, match the standard SMI rate used in benefits assessments. 

Next the government, I understand, has gone back to the lenders to suggest that, in return for a few hundred million pounds a year, they freeze the mortgage accounts of those on benefits - no interest accrual, no repayments - while they continue to claim.  The issues of the practicalities of such an approach, particularly to some of the mortgage types now in use such as offsets, seem to be ‘for later discussion’.

The UC itself, dependant as it is on a new HMRC computer system, may see its timetable slip, even earlier than many of us expected; Dame Lesley Strathie, Permanent Secretary and Chief Executive, HM Revenue and Customs appeared before the Public Accounts Committee a couple of weeks ago and it’s worth reading that:

http://www.publications.parliament.uk/pa/cm201011/cmselect/cmpubacc/uc502-ii/uc50201.htm

Some of the comments (out of context)

“Dame Lesley Strathie: ... real-time is the next big leap, ..However… real-time will never be designed for 100% of the population-that is impossible ....  I believe that we need to work with businesses for probably about two years and have a plan incrementally to bring them on board this system, if we want to do it well.

.. Dame Lesley Strathie: The DWP will not build in real-time information. It will be relying on HMRC building a real-time information system for PAYE. There will be a reliance on sharing that data.

Dame Lesley Strathie: Yes, the universal credit. We will have to share the same information.

Q241 Matthew Hancock: The DWP will be using real-time payments information in order to deliver the universal credit within two years, but you are saying that over those two years is when you will start to talk to people.

Dame Lesley Strathie: No. ...we have put out advice on the basis on which we would bring this next change on board, and consultation has yet to take place….the speed at which we have to build the technology and start this process is, to a large extent, determined by the welfare reform needs. ...DWP has a big, hard dependency on HMRC.

...The idea is that the IT for real-time information should be in place by April 2012.

Q243 Matthew Hancock: In HMRC as well as DWP?

Sarah Walker: In HMRC. But we won’t put all employers straight on to it at that point. There will be a period over which we will gradually bring employers on to it .... The information will then be available and can be used by DWP .
..
...Does that mean that the DWP time frame is predicated on HMRC getting its act together? The Secretary of State says that he has a two-year time frame for introducing something…that cannot be introduced unless HMRC gets the foundation stones laid and the building halfway built.

Dame Lesley Strathie: I think it is important that I don’t answer for DWP any longer.

Q245 Mrs McGuire: But you have sown a seed of doubt in terms of the time scale.

Chair: DWP is dependent on HMRC, and HMRC cannot deliver in a time frame to enable DWP to do it within two years.

Dame Lesley Strathie: No. We are planning to deliver to support universal credit. Let me reassure you. “

Any slippage would, of course, present the DWP with a perfect excuse for delay, or failure, for UC.

And that would be tragic. UC, I now think, has the potential to become a better support system that the existing structure. The danger lies in two areas.

The first is the headline demand for speed and simplicity. It won’t work if the systems can’t support it and it won’t work if it’s made too simple; there are too many flaws and traps in the current outline.

The second danger is that it will be too cheap. Too cheap in what it pays to support people, in particular the outliers, and too cheap in the way that they propose to run it. It’s a service and it must provide customer service which lets vulnerable people have simple, easy to access, methods of contact and dispute resolution.

But, to solve those dangers will require thought and a coherent policy development process within government and the departments rather than panic and kneejerk reaction.

At the moment there’s little evidence of that.

of course they don’t, to answer your heading question.  all they are interested in is removing as many people from as many benefits as possible as quickly as possible, and reducing what benefits they pay, and aren’t much interested in the practicalities - which is why, as you say, much sound of brakes slamming on as they are told the facts of IT and HMRC and DWP life…

Universal Credit is the coalitions Magic Pony.

If one accepts the Coalitions premis that the current system is unsustainable (for what ever ideological or resourse reasons) and given that UC will be little different from the current means tested benefits in practice (as far as can be determined from the lack of detail) isn’t introducing UC (regardless of any technical issues with IT etc) like re-arranging the deckchairs on the Titanic?

Incidently speaking to two DWP fraud investigators yesterday apparently their budget is being squeezed and they are restricted in the amount of travel, observations etc they can undertake. So that will be a good way of coming down hard on fraud then?

Does this government know what it is doing?  Absolutely not.
Does this government know what it wants to do?  Absolutely.

Colleagues may be interested to read an article by Nick Pearce and Gavin Kelly writing for the IPPR on ‘Welfare: thinking the thinkable’ at http://www.ippr.org/articles/?id=4265  .  They seem to agree with Gareth and other contributors.