Select Committee · Public Accounts Committee

Progress in implementing Universal Credit

Status: Closed Opened: 10 Jan 2024 Closed: 28 May 2024 2 recommendations 34 conclusions 1 report

There are currently around six million people receiving Universal Credit (UC) benefit payments, launched in 2010 to replace six-means-tested benefits for working-age households. At the end of 2022, some 2.5m households remained on legacy benefits, with the Department for Work & Pensions (DWP) starting to scale up moving people onto UC through its ‘managed migration’ …

Clear

Reports

1 report
Title HC No. Published Items Response
Twenty-Ninth Report - Progress in implementing Universal Cr… HC 458 26 Apr 2024 36 Responded

Recommendations & Conclusions

10 items
2 Conclusion Twenty-Ninth Report - Progress in imple… Rejected

Regularly track and publish Universal Credit claimant outcomes including employment, earnings, and hours.

The Department’s evaluations show that Universal Credit is having a positive impact on the labour market, but these have assessed only the short-term impact on claimants. The Department’s studies have evaluated the short-term impact for individuals who made a claim for Universal Credit in 2018 or earlier. The findings include …

Government response. The government disagrees with the recommendation, stating that tracking specific employment outcomes and duration for Universal Credit claimants was not an objective and would not provide the necessary insight into the program's impact.
HM Treasury
6 Conclusion Twenty-Ninth Report - Progress in imple… Rejected

Explain better how transitional protection is calculated in guidance and migration notices.

The Department has not explained clearly how transitional protection works so benefit claimants, and the organisations that advise them, do not fully understand how amounts are calculated. The Department provides ‘transitional protection’ designed to ensure people are not worse off on Universal Credit at the point of moving. It tops …

Government response. The government disagrees, stating that migration notices are designed to focus on necessary actions, and that claimants do not want them to convey detailed explanations of transitional protection calculations. It notes a technical guide exists for advisors and is considering …
HM Treasury
8 Conclusion Twenty-Ninth Report - Progress in imple… Rejected

Universal Credit demonstrates positive short-term labour market impact for claimants, DWP evaluations confirm

The Department has some evidence to indicate that UC is having a positive impact on the labour market based on its evaluations of the short-term impact. Its first four evaluations covered single claimants without children – the most recent of these, based on data from 2018, found new UC claimants …

Government response. The government disagrees with the implied recommendation to track job types and duration for UC claimants, stating it was not a program objective and would not provide the desired insights for evaluating Universal Credit's impact.
HM Treasury
9 Conclusion Twenty-Ninth Report - Progress in imple… Rejected

DWP's labour market impact estimates rely on selected positive findings and assumptions

We asked how the Department’s evaluations of whether UC is more likely to get people into work compared with legacy benefits enabled it to estimate how much people contributed to the economy.15 The Department said it was now difficult to compare the labour market impact of UC with legacy benefits, …

Government response. The government rejects the implicit recommendation regarding its evaluation methodology and economic contribution estimates, stating that tracking specific claimant types was not an objective and would not provide valuable insights for the business case. It affirms its commitment to understanding …
HM Treasury
11 Conclusion Twenty-Ninth Report - Progress in imple… Rejected

DWP evaluations assess Universal Credit's short-term labour market impact, not long-term individual effects

The Department’s evaluations have considered only the short-term impact of UC on the labour market.19 We asked about the longer-term impact on claimants’ employment status, beyond the six months after they started their claims. The Department acknowledged that it had measured the effects of UC on individuals only in the …

Government response. The government rejects the implicit recommendation to track long-term individual employment impacts, stating it was not an objective of the UC programme and such tracking would not provide valuable insight for business case benefits. It asserts that current monitoring and …
HM Treasury
12 Conclusion Twenty-Ninth Report - Progress in imple… Rejected

DWP evaluations focus on employment likelihood, not job security or specific types of work

We also asked the Department about the types of jobs people took up after claiming UC and whether the jobs were secure. The Department told us that its evaluations showed only whether claimants were more likely to be in employment. It added that its first evaluation did consider the levels …

Government response. The government disagrees with the implied recommendation to track job types and duration for UC claimants, stating it was not a program objective and would not provide the desired insights for evaluating Universal Credit's impact.
HM Treasury
29 Conclusion Twenty-Ninth Report - Progress in imple… Rejected

Department provides transitional protection to 330,000 migrating households to avoid Universal Credit detriment.

The Department provides financial support to claimants it moves under the managed migration process, known as ‘transitional protection’, to make sure they are not worse off on UC at the point of moving than they were on legacy benefits. The Department calculates a claimant’s UC entitlement and then adds a …

Government response. The government disagrees with the implied recommendation, stating the Universal Credit Migration Notice has been rigorously tested and that feedback suggests claimants prefer the notice to focus on required actions rather than other messages.
HM Treasury
30 Conclusion Twenty-Ninth Report - Progress in imple… Rejected

Concerns raised regarding accuracy, transparency, and consistency of transitional protection calculations.

In written evidence, organisations who work with benefit claimants raised concerns about how the transitional protection arrangements were working, specifically about how the Department calculated amounts due, how accurate its calculations were, and the risk that people were receiving incorrect payments which they could not check themselves due to a …

Government response. The government rejects the implied recommendation to address concerns about transitional protection transparency, stating the Migration Notice is effective and claimants prefer it concise. It notes a technical guide for advisors exists and is considering what other general information might …
HM Treasury
31 Conclusion Twenty-Ninth Report - Progress in imple… Rejected

Department acknowledges claimant difficulty understanding transitional protection, developing guidance with stakeholders.

We asked the Department what it was doing to help vulnerable individuals understand the transitional protection arrangements. The Department told us that during its testing phase it had found that claimants struggled to understand how transitional protection worked – it was a simple concept but a complex policy to explain. …

Government response. The government rejects the implicit recommendation to improve vulnerable claimants' understanding of transitional protection, stating the Migration Notice is effective and claimants prefer it concise. It notes a technical guide for advisors exists and is considering what other general information …
HM Treasury
32 Conclusion Twenty-Ninth Report - Progress in imple… Rejected

Automated transitional protection calculations rely on correct data input; claimant transparency is limited.

The Department also told us that it had automated much of the transitional protection process so that calculations were done on the system by a tested algorithm, but the system relied on the right information being input. It highlighted that it informed claimants how much of their UC award was …

Government response. The government rejects the implied recommendation to provide more detailed transitional protection rules to claimants, stating the Migration Notice is effective and claimants prefer it concise. It notes a technical guide for advisors exists and is considering what other general …
HM Treasury

Oral evidence sessions

1 session
Date Witnesses
11 Mar 2024 Helga Swidenbank · Department for Work and Pensions, Neil Couling CB CBE · DWP Services and Fraud, Peter Schofield CB · Department for Work and Pensions View ↗

Correspondence

3 letters
DateDirectionTitle
8 May 2024 Correspondence from Peter Schofield CB, Permanent Secretary, Department for Wor…
26 Apr 2024 Correspondence dated 26 April 2024 from the Chair to Peter Schofield CB Perman…
15 Apr 2024 Correspondence from Peter Schofield CB, Permanent Secretary, Department for Wor…