Universal Credit: National Rollout

Lord Freud Excerpts

Monday 28th October 2013 Lords Chamber

[Lord McKenzie of Luton]

To ask Her Majesty’s Government when they will publish an agreed plan for the national rollout of Universal Credit.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud) (Con)]

Our priority is to deliver universal credit safely and securely over a four-year period to 2017. We remain committed to that objective, these timescales and the budget. We have already announced plans to expand universal credit into additional jobcentres from today and to roll out the claimant commitment nationwide by next spring. We have also said that we will provide more details around our implementation plans later in the autumn.

[Lord McKenzie of Luton (Lab)]

I thank the Minister for that Answer. Any confidence that we may have had in the Government’s ability to deliver universal credit was dramatically shaken by the NAO report last month. It concluded that the DWP was not achieving value for money and that there was,

“weak programme management, over-optimistic timescales, and a lack of openness about progress”.

Alarmingly, it stated that the department does not know to what extent its new IT systems will support national rollout. When will those systems be fit for purpose to support national rollout as well as enable detection of fraudulent claims? I also note that the department has written off £34 million-worth of abortive IT expenditure. How much more will be written off as abortive before the Government get their act together?

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[Lord Freud]

My Lords, first, I take the opportunity to congratulate the noble Lord on taking up a slightly more relaxed lifestyle on the Back Benches with this portfolio. I pay tribute to him for his formidable contribution over many years from the Front Bench. To deal with his latest and just as formidable contribution, I remind noble Lords that the NAO said in its report:

“Spending so far is a small proportion of the total budget … and it is still entirely feasible that [universal credit] goes on to achieve considerable benefits for society”.

[Lord German (LD)]

Would my noble friend agree that the introduction of universal credit represents one of the largest system changes we have ever seen in the public sector in this country, sitting as it does on a hugely complex IT platform? Given the significance of universal credit in that it will always make work pay more than being on benefits, does my noble friend agree that getting it right is more important than making mistakes as we go along? But, if he will forgive my impatience, when will we see the first families with children being able to receive universal credit?

[Lord Freud]

My Lords, I entirely agree with the sentiment. When you are introducing a large cultural change like this, it is important to do it in a careful and controlled way, and to make sure that it is safe and secure. That is how we have been introducing our series of changes, such as child maintenance, PIP and benefit cap. I am not in a position, until we announce Howard Shiplee’s plans later this year, to give a timetable of when couples and children are brought into the migration strategy.

[Lord Foulkes of Cumnock (Lab)]

My Lords, this is really depressing. Why do the Government not pay attention to Sir John Major? Last week in the Press Gallery he advised the Government not to pay attention to the bean counters and cheerleaders, but to the people working with the disabled, the elderly and others who are suffering. John Major also said that this was going to fail, that all these reforms were going to fail, unless Iain Duncan Smith was a genius, and he saw no proof of that. Does the Minister have any proof? Unless he does, is it not about time that for the sake of our disabled people the Government started to think again?

[Lord Freud]

My Lords, the party opposite is not saying that universal credit is not the right transformation. Although it voted against various aspects, it is actually saying that it is the right way to go. The issue is how to introduce it. We are introducing it safely and securely, and we are doing that exactly for the kind of people to whom the noble Lord was referring. We are making sure that we do not produce shocks by introducing a new system on one day in the way, for instance, that tax credits were introduced and which was a failure. We are doing this slowly and securely.

[Lord Cormack (Con)]

My Lords, as this is such a profound change, would it not be sensible to have a Joint Committee of both Houses to monitor and supervise its introduction and development?

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[Lord Freud]

My Lords, I can assure noble Lords that there is no shortage of people overseeing this particular programme. I do not really think that there is a need for another layer.

[Baroness Royall of Blaisdon (Lab)]

My Lords, undoubtedly the Minister is right that there are an awful lot of people overseeing the process, but the suggestion made by the noble Lord, Lord Cormack, is a good one. There may be better people to oversee the process. The noble Lord was generous in his tributes to my noble friend, but he did not answer the Question. My noble friend is still a valued member of the Front Bench and speaks on the Department for Communities and Local Government.

The DWP has estimated that a three-month delay in transferring cases to universal credit would reduce savings by £240 million in the current spending review. Will the Minister please tell the House how this reduction is to be funded?

[Lord Freud]

My Lords, I am not aware of any such mathematics. We have always said that we will introduce universal credit in a safe way and that we will adjust the timetable in the light of experience. We now have Howard Shiplee on board, and he is immensely experienced. He produced the Olympic Park on time, and he is working to make sure that we have a plan that will introduce this programme effectively.

[Baroness Wheatcroft (Con)]

My Lords, our welfare system is broken. If it takes a little while longer than we had originally hoped to put it right, surely it is right that we should take the time. Universal credit is a massive step in the right direction. Does the Minister agree that the real tragedy would be if benefits claimants were reduced to such desperate circumstances that they had to superglue themselves to benefit desks?

[Lord Freud]

My Lords, when you introduce a big programme of change, the important thing is that you test and trial it thoroughly. We have a major programme of testing and trialling, whether it is the intensive-activity programme, the in-work conditioning pilots, the housing demonstration projects or the 12 local authority pilots. I am hoping soon to publish the next issue of the local support service framework that is designed exactly to make sure that there is a support network for people who might otherwise look for the superglue.

[Baroness Hollis of Heigham (Lab)]

Like others in this House, I support universal credit and I welcome it, but I am deeply worried that it is going to be a paperless system accessible only online. A very large number of people in their 40s and 50s in limited financial circumstances on benefit do not possess computers, smart phones or computer skills. They will not be able to interrogate or correct errors on the system, and even if the Minister successfully delivers the structure, which I hope he is able to do, although I have my doubts, I am profoundly worried that an awful lot of people who should receive their full benefit will not be able to do so because they will not have access to a paper system.

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[Lord Freud]

My Lords, we are designing the system to be digital, which must make sense in the 21st century. It also makes enormous sense to get people into the digital environment, not least because 94% of all jobs now require that kind of capability. However, our plans do not rely on everyone having to interrogate the digital system themselves. We will have back-up systems in a telephone service and a face-to-face service for those who absolutely need it. We will have a system to encourage people into the digital environment.