Universal Credit update

02 May 2014

There remains uncertainty about the Universal Credit IT system, according to a report by the Work and Pensions Committee, including how it will work, how much it will cost, and who will develop it.

National roll-out of UC (the driver behind real time information) was due to begin in October 2013. But problems with IT systems meant that major changes to the implementation timetable were made in July and then again in December 2013. Currently, UC claims are still limited to 10 Pathfinder Jobcentres. New claims are not expected to be extended to the whole of Great Britain until 2016; and the bulk of existing claimants will not move over to UC until 2016-17.

Commenting, Dame Anne Begg MP, Committee Chair, said:

"Only 4,280 people were claiming Universal Credit by December 2013 and the majority of these claims were of the simplest nature. By comparison, in the same month, 1.22 million people were claiming Jobseekers Allowance. This demonstrates the scale of the challenge still facing the Government in trying to implement UC by 2017.

Whilst it is right to ensure that the system works properly before extending it, there is a difference between cautious progress and a snail’s pace. Given the excruciatingly slow pace of roll-out to date, it is hard to see how the most recent implementation timetable can be met."

The Department for Work and Pensions (DWP) is trying to resolve the IT problems by developing a new “end-state solution” for UC IT which will eventually replace the IT system currently in use in the UC Pathfinders. This is costing £25-32 million to develop up to November 2014, with no indication of how much more it will cost in the long-term. And it will only be clear that it works once it has been tested at scale. However, it is still some way from being tested on the first 100 claimants.

The Government should provide more detail on what the end-state solution means in practical terms, including how much it will cost, when it will be ready to test on the first claimants, how it will be extended, and when it is expected to be fully implemented.

The current "twin track" approach to UC IT development also means that the Government is still spending money on the existing IT being used in the Pathfinder while the end-state solution is developed.

The Committee Chair said:

"The money wasted on Universal Credit so far – £40 million on IT software that now has no use and £90 million on software with a useful life of only 5 years – is a matter of deep regret. It is vital that DWP learns the lessons of past mistakes.

At the same time as developing the "end-state solution" the Government intends to spend £37-£58 million on further developing the existing IT system. Given the small number of people currently claiming UC, the Government should consider whether it would be a better use of taxpayers’ money to abandon further development of the existing system and focus solely on the end-state solution.

Despite the millions being spent on the end-state IT solution it is still not clear when the system will be ready or even how it will work. It is still not ready for testing on the first 100 claimants, and we have no indication of when it will be possible to test it on a bigger and more representative group of claimants."

 

CIPP comment

Having rushed employers down the route of submitting information in real time to HMRC, the CIPP are extremely disappointed to learn that Universal Credits is still not fit for purpose. The CIPP is very much in favour of utilising the electronic world including the submission of data to any government department, but has always maintained the timeline was far too short.

Karen Thomson, Associate Director of the CIPP’s policy and research team said:

“Whilst overall RTI is working, it hasn’t been without hard work from the payroll industry and HMRC to achieve the success it has had. If the timetable had been longer I am sure some of the issues the industry has experienced for example, the reconciliation problems, would have been sorted out long before the project was live. It might have also been possible to provide employers with useful tools such as a dashboard that shows figures in real time. We are where we are, so would now urge the government to do whatever is necessary to ensure UC is fit for purpose and take advantage of RTI submissions as originally intended.”

 

Further information