Universal Credit costs £36,222 per claimant (excluding the claim) – Campaign4Change

Iain Duncan Smith has told MPs that the costs of the Universal Credit project are £652m to March 2014 – which is about £36,222 per successful claimant, writes Tony Collins on Campaign4Change.

The figure includes the money paid to the DWP’s Universal Credit IT suppliers which was £303m by the end of 2012/13.  An updated figure will be published in a UC report by the National Audit Office due to be published near the end of this month.

The costs of Universal Credit per successful claimant are disproportionately high for an IT-enabled programme that has been running for more than three years because numbers on the system are small.

If the UC programme were complete, at a forecast cost of £1.8bn, and the predicted 7.7 million people were receiving the benefit, the scheme’s delivery costs per claimant would be only about £234.

As at October 2014 17,850 people were on the Universal Credit caseload.  IDS told the Work and Pensions Committee on 5 November, in a hearing that lasted more than 2 hours,  that the costs of UC were £652m by March 2014.

That works out at about £36, 222 per successful UC claimant.

Total delivery costs for the programme are expected to be £1.8bn, down from an original prediction of £2.4bn, IDS told the committee.

IDS and the DWP hope many more successful claimants will be added to the systems next year when Universal Credit is rolled out to all jobcentres and local authorities across the country. But the scheme is subject to growing uncertainties, as the DWP’s permanent secretary Robert Devereux and IDS made clear to the committee.

DWP drops firm end date for UC

When an MP put it to IDS that he no longer has a concrete end date for when  7.7 million people will be on UC, he paused. Then he said the plan was for UC to be complete “by the end of 2018″. He gave no commitment and did not deny that there is no concrete end date.

“Er yes, yeah,” replied IDS. “We do envisage UC being complete by the end of 2018. That’s our plan.”  He said that UC would handle singles, couples, then families. In the meantime the DWP is developing an “end-state digital process” that will deliver benefits for claimants and the departments.

“The roll-out gives us phenomenal understanding of what we need to do to make sure the digital service ultimately comes in and completes that process properly. There is a de-risking of the process.”

UC may never be fully automated

Another uncertainty for UC is its ability to handle an estimated 1.6 million changes per month to people’s claims.

Changes in circumstances are handled manually at present.

Robert Devereux, permanent secretary at the DWP, told the committee that the UC systems are, for some claimants,  part manual, part automated. Devereux said:

“The peculiar nooks and crannies with individual circumstances  – we have deliberately not tried to code every permutation as we go along. We are trying to make sure it can be safely delivered within costs in a sensible fashion.

“It would not be sensible to code every possible permutation back at the start while you are still learning.  There are different elements of the system, some of which will be [digital] all the way through, some which are not.”

The committee chair Dame Anne Begg questioned whether UC will ever work effectively if manual processing is applied to some of the 7.7 million claimants. She received no clear answer.

Read more on the Campaign4Change website.

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9 thoughts on “Universal Credit costs £36,222 per claimant (excluding the claim) – Campaign4Change

  1. Jeffery Davies

    When a person working for a company does work like this man they would get the sack long ago but on he’s allowed to go about his wreckless waste of public monies yet he triumphantly blows hes getting people back to work yet ask whot work then theres more silence but whot has he got on cams and co has this devil should be locked up for his deeds jeff3

  2. JJ

    Universal Credit will NEVER work as planned. IDS once claimed that over 1,000,000 claimants would be on Universal Credit by last April; in fact less than 7,000 people were and so I would take everything he says about time-frames with a shovel of salt. Based on anecdotal reports UC has been a nightmare for many claimants in the pilot areas where it is being trialled, sometimes leaving claimants with no income while very minor problems in respect to claims have to be resolved and are not handled quickly enough by clerks manually processing claims to enable the needy to receive monies due to them in good time.

    Universal Credit is a disaster.

    God alone knows what will happen if/when it is rolled it out countrywide.

    1. Jonathan Wilson

      It will be just like the previous “expansion/roll out” a big fanfare by the “DWP spokesperson…” ‘we are rolling it out to X more areas’ but no one will actually go on it which will be found out about 3 months later when the figures have hardly increased.

      It already/still can’t handle 90% of changes related to “living arrangements” (someone moving in, shared accommodation, the addition of a child to the household, etc) and these have to be done manually by a data clerk entering “fudge factors” to get it to work (IDS, or his oppo, admitted this at the last inquisition) it does however handle the simple case of earnings changes although it seems that the delay means if you get a good month followed by a bad month (work wise) then you end up with sod all, but its sorted by the following month so technically you are no worse off :-/ )and as once you are in the clutches of UC you cant get off if your circumstances (household) change you get shafted by the manual side of things introducing delays and incorrect payments.

      In summing up… it does not work, it can not work, it will never work. but who cares so long as IDS takes the flack away from Camoron and Gidiot.

  3. keithmcmanus

    Being on the front end and seeing UC flounder day in day out, it was always going to be a disaster – no two individuals have the same claim, each has to be treated on its own merits.

  4. Tim

    The only people piloted onto Universal Credit have been fully unemployed single people and a small number of fully unemployed childless couples who would only receive Jobseeker’s Allowance and Housing Benefit. More difficult cases which involve recalculation of benefits regularly in real time, e.g., part-time workers, self-employed persons, people on zero-hour contracts, men, women and families with children and people with other kinds of variable circumstances – non of these people have ever received Universal Credit in a single pilot area.

    When IDS talks about rolling UC out to all Jobcentres he’s only talking about new claims made by fully employed single people and not other kinds of claimants. In other words the very simplest of simple claims. When it comes to more complex categories of claimant Universal Credit fails big time.

    I really don’t know how Iain Duncan Smith can get away with his lies.

  5. Thomas M

    UC is meant to get rid of what is left of the power of the workers by making them totally dependent on their employer like in the 1800s.

  6. joanna may

    Mike how is it that IDS is so arrogant about UC? If a different government comes in, then why would they continue with an edsel? Wouldn’t it be like flogging a dead horse? And anyway I thought a present government couldn’t force another to take on their policies?

    1. keithmcmanus

      I stand to be corrected, but It was the Labour Government who introduced the Welfare Reform Act via the Queens Speech 2009 prior to be Kicked out of office in the Elections of 2010 Only difference being Labour wanted a slower introduction whereas the Conservative went hey ho lets go for it. I don’t see any party changing anything, its all about blame game when the Conservatives will lose the Election next year. The only possible relief I see might be the bedroom tax overhauled. Personally I see a UKIP and Labour Coalition with the Lib Dems losing deposits up and down the country.

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