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Universal Credit: Marks out of 10 on its 10th birthday

April 27, 2023 – entitledto
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This Saturday marks an important milestone in the evolution of the UK’s benefit system. Ten years ago, on 29 April 2013, the first claims to Universal Credit (UC) were made by newly unemployed people living in the North West.

According to Iain Duncan Smith, Work and Pensions Secretary at the time and architect of the reform, these new claimants would enjoy a better, simpler system, with support from six different benefits combined into one. In particular, rather than switching benefits when entering or leaving work, there would be one system whatever an individual’s employment status. Launching the benefit, he claimed that UC will “help people to move into and progress in work…it will be simple to understand and administer.”

Since 2013 UC has been rolled out to all parts of the UK and 4.3 million households currently receive a payment. Even so, around 2.5 million households are still on the old ‘legacy’ benefits that UC replaced. And it’s true to say that UC had a mixed reception from recipients, at least during its first few years.

So where does UC stand now as a public policy reform?

We decided to mark UC’s tenth birthday by providing an assessment of what’s good, bad and indifferent in the way UC’s been designed and implemented.

We’ve given it marks out of ten in each of ten categories: adaptability, administration, connectivity, durability, effect on poverty, effect on work incentives, scalability, simplicity, system migration and take-up.

The table below provides a summary but the full report digs a little deeper. You'll see we’ve given UC top marks in relation to scalability but nothing for system migration, with a range of marks in between.

Overall, we give it four marks out of ten and our view is that Universal Credit is not a complete disaster, particularly compared to some other reforms introduced since 2010, but it’s very far from a triumph.

Social security policy definitely deserves better.

Download the full report for more detail about each category.

'Universal Credit Marks out of 10' report front page

entitledto’s Universal Credit scores

Adaptability score = 2

It only works for ‘typical’ monthly-paid employees. Weekly-paid workers see awards systematically vary.

Administration score = 6

It’s got much better. But digital-only application is still a challenge to many.

Connectivity score = 3

The system was not set up to share data.

Durability score = 4

Might limp on to 15 years, the standard duration for means-tested benefits for working-age people.

Effect on poverty score = 2

The minimum income standard has fallen.

Effect on work incentives score =  4

The taper rate is now down to 55%, but by getting rid of work hours rules UC has created a new ‘cliff edge’.

Scalability score = 10

The online system was proven to scale well in the Covid-19 pandemic.

Simplicity score = 4

If you are new to benefits it’s better, but as a whole the system is more complex.

System migration score = 0

Only two thirds there after 10 years, and unlikely to ever be completed.

Take-up score = 5

Half marks as unknown.

Average = 4/10

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