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The Tories only have themselves to blame for Labour’s threat to Universal Credit

28 September 2019

5:29 PM

28 September 2019

5:29 PM

The Labour Party is buzzing about in Iain Duncan Smith’s constituency today, threatening both to unseat the former Conservative leader and scrap the reform he introduced: Universal Credit. Jeremy Corbyn made the promise, saying the changes to the benefits system have been an ‘unmitigated disaster’. The party will first get rid of the most controversial aspects of UC – including the fitness-to-work tests, the two-child limit, and sanctions which dock benefits from claimants who miss appointments – before scrapping it entirely.

This has naturally prompted protests from the Tories, including some of the many MPs who served as work and pensions Secretary at one point or another. But the truth is that the Conservatives have brought this on themselves with a series of avoidable mistakes.

The first was to become so enamoured with the good principles of their reforms – simplifying the devilishly complicated welfare system, making work pay, and so on – that they were slow to acknowledge that there were problems with the implementation. This is a common problem in politics, where the distinction between a good idea and the steps necessary to realise it isn’t fully understood. Duncan Smith would often tell critics of aspects of his reform that they didn’t care about making work pay and life easier for people caught in the benefits system. It was the sort of retort you hear from all ministers, but in this case it seemed that Duncan Smith really believed it and did view critics as opponents, rather than people who might have a point. I wrote about one aspect of the reforms, the work capability assessment, back in 2013, warning that if the Tories didn’t realise that there really were valid concerns about these tests, then they could doom the whole welfare reform project early on. I’m sad to say that this has been proved correct.


A second serious flaw wasn’t Duncan Smith’s fault. There wasn’t enough money. In Opposition and in the early days of the Coalition government, he had always argued that the government would need to spend more money upfront on Universal Credit in order to save money down the line. This is the sort of argument that you regularly hear from campaigners: if the Treasury would just invest £10bn in this clever reform now, then it will save £100bn in the next ten years. It sounds attractive and sensible to many of us, but not to the Treasury even in good times. And these were not good times: Duncan Smith and his colleagues were trying to introduce UC at the same time as the then chancellor George Osborne was trying to cut the welfare budget. Osborne and IDS didn’t see eye-to-eye on many things, and each man had a different priority. These competing priorities meant that welfare reform quickly appeared to be a vehicle for swingeing cuts, rather than something that was supposed to change lives.

Osborne reportedly doubted IDS’ intellectual ability to carry out the reforms, and there were other ministers around at the time who agreed. Chris Grayling, who was employment minister in the Work and Pensions department between 2010 and 2012, would tell colleagues that he was the man who had a better grip of the various spreadsheets involved than his senior minister.

Backbench MPs didn’t understand the full detail of the changes, and so fell into the trap of supporting them without checking that they would lead to what was being promised. They would then frequently panic when something that they’d fail to pay attention to in parliament was implemented in their own constituencies. The ‘bedroom tax’, whereby social tenants were only paid housing benefit for the bedrooms they were actually using, so surprised some Tories that they wrote angrily to local housing associations complaining that they were making it impossible for their tenants to afford their rent. The social landlords coolly replied that the reason the tenants couldn’t afford the rent was that the government, of which these MPs were supporters, had cut their benefits without giving them an alternative place to live. When the roll-out of UC began, MPs were once again shocked by the impact it was having on their constituents, having failed to heed repeated warnings in Westminster about the impact of the six-week delay on paying out the benefit, and of some of the sanctions involved.

This takes us back to the point about failing to check the detail of an important reform because you are so caught up defending its principle. Tory MPs wanted UC to work, and they wanted their government to succeed. They had such a short-term view of what success meant, though, that they didn’t think it would be wise to check that everything was going to work just as promised.

This is a lesson that will doubtless by lost on Labour, too, as it draws up its own plans to reform the welfare system once again. If the party does end up in government, it will swat away criticisms of its policies as coming from Tories who don’t care about benefit claimants, rather than as potentially serious flaws in the system. And so on rolls the mess of welfare reform, made so much worse by the way our current political system rewards inattention until it is too late.


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