Latest Public Sector News


Universal Credit could backfire – Social Market Foundation

The Government’s flagship welfare policy, the introduction of Universal Credit, has been criticised in a new report that suggests it could endanger the people it seeks to support.

The Social Market Foundation has published a report, ‘Sink or Swim’, which highlights concerns with switching to a once-monthly benefit, and the impact this will have on low-income claimants as they attempt to budget for household spending.

Universal Credit will replace the means-tested elements of six different benefits, including jobseeker’s allowance and housing benefit, and will be paid once a month rather than weekly or fortnightly as a consequence of being integrated with the tax system. Roll-out begins from October 2013, with final implementation from 2017.

People living in social housing will be required to make their own rental payments, but the SMF recommends that the Government should introduce an online budgeting tool to help people move towards better management of their benefits.

The think tank believes people may run out of money towards the end of the month, although the Government has stated it will be ‘flexible’ with those who struggle to cope.

Nigel Keohane, the think tank’s deputy director and co-author of the report, said: “The Government’s laudable aim that Universal Credit should prepare families for work, boost their resilience to financial shocks, and simplify the system is at risk of backfiring.

“By moving to a single monthly payment for all benefits, the Government is removing the markers and aids that families currently rely on to budget effectively. Our research shows that this will throw people in at the deep end leaving them either to sink or swim.

“This laissez-faire approach will create real problems not only for families themselves, but also for public service organisations, such as social landlords and childcare providers, that families will end up owing money to.”

A Department for Work and Pensions spokeswoman responded: “Universal Credit will be paid monthly because most people in work are paid that way and the system should help people get used to the patterns of working life.

“But we will make sure that no one falls through the cracks, and we are working with local authorities and the financial industry on how best to support individuals. We have always said we would be flexible with people who might struggle to manage their money.”

There have also been concerns over a lack of clarity in the details of how Universal Credit will work. The Government expects 80% of people to claim online, despite a growing ‘digital divide’ between those with the knowledge and access to the internet and those without.

Labour has called for the introduction of UC to be delayed for a year to ensure the policy is effective.

Dame Anne Begg, who chairs the cross-party work and pensions select committee, said: “We have found Treasury officials complacent. They don't understand how people lead their lives. Their expectations of employers and individuals are unrealistically high.”

The report is at:

Tell us what you think – have your say below, or email us directly at


There are no comments. Why not be the first?

Add your comment



public sector executive tv

more videos >

last word

Collaborative working is the key to the future at home and abroad

Collaborative working is the key to the future at home and abroad

David Hawkins, operations director at the Institute for Collaborative Working (ICW), on why ISO 44001 is a new evolution in collaborative working. The past 12 months have seen seismic changes b more > more last word articles >

public sector focus

View all News


An integrated approach to greening public transport

28/04/2017An integrated approach to greening public transport

Dave Pearson, director of transport services at West Yorkshire Combined Aut... more >
Unlocking the combination to criminal justice reform

28/04/2017Unlocking the combination to criminal justice reform

If new mayors want to improve the life chances of their communities, help t... more >


Maintaining the momentum for further devolution

25/04/2017Maintaining the momentum for further devolution

Ahead of this year’s mayoral elections, Lord Kerslake, the former hea... more >

most read

Shared Services and Outsourcing Week

the raven's daily blog

A watershed moment in British democracy

02/05/2017A watershed moment in British democracy

The upcoming mayoral elections represent a watershed moment in the history of British democracy, reports PSE’s Luana Salles.  On 4 May, voters across six regio... more >
read more blog posts from 'the raven' >

editor's comment

11/04/2017A watershed moment in British politics

The government has now officially triggered Article 50, formally starting the process of Britain’s exit from the EU. How this will affect local government, the wider public sector and the Civil Service remains to be seen, but the likelihood of it being plain sailing with the enormity of the task ahead seems rather unlikely.  It is, therefore, quite appropriate that in this edition of PSE Professor Chris Painter reflects on the profound changes that have taken place in the... read more >