People say Universal Credit is a failure, but it’s achieved an astonishing political feat: it’s united the executive editor of ConservativeHome, the entirety of the parliamentary Labour Party, Conservative MPs from Heidi Allen to Jacob Rees-Mogg, and now Labour’s last Prime Minister Gordon Brown.
Brown today warns that if the Conservatives do not halt the Universal Credit roll-out, it will trigger a “summer of discontent” for the party next year.
The overarching problem with Universal Credit is that it has always been the servant of two masters: an Iain Duncan Smith project to make work pay and a Treasury project to reduce the size of the social security bill. That battle was decisively lost by Duncan Smith which is one reason why he quit the Cabinet in 2016. The reality is that Universal Credit has exacerbated the problem of in-work poverty and has made it harder, not easier, for people with dependent children or disabilities to enter the workforce, while being an inadequate safety net for people who are unable to work.
The one thing it has been any good at – other than provoking astonishing political unity – is in allowing the Treasury to make illusory savings by grandfathering in politically contentious cuts to in-work benefits into the new system, rather than doing them to the existing welfare system.
But the political problem is that the reason why these cuts had to been grandfathered in is that they cause too much pain to the people on those benefits, which in turn causes too much electoral pain to the Conservative Party. Now those cuts are being rolled out to Universal Credit and the actual and political pain is back.
Is Gordon Brown (and Mark Wallace, and most Conservatives in marginal seats, and every Labour MP, etc. etc.) right? Well, yes. The remaining defenders of Universal Credit in its current form are putting way too much faith in the fact that most people who are currently on the benefit are satisfied with it. But most people on Universal Credit are the easiest and least complex cases – young people without dependents – who also benefit from the things about Universal Credit that do work well. (The ability to take out a chunk of your benefits in advance is great if you are a graduate looking to buy a decent interview suit and you have no credit card debt or mouths to feed, for instance.)
But most people in the benefits system aren’t young people without dependents, and for most the reality will be a benefit that looks and handles much like their old in-work benefits: but with much, much less money to go around.
Even the promise of these cuts was enough to majorly destabilise David Cameron’s government back in early 2016, and essentially end George Osborne’s hopes of becoming Prime Minister. Given what it did to Cameron’s approval ratings there is good case to be made it helped cause Brexit into the bargain. The potential for real and enduring damage both to people’s lives and to the government is very real if Universal Credit is rolled out in its current form.
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