Universal Credit: Changes urged as Government's flagship benefit reform 'veers off track'

The Universal Credit risked being reduced to little more than a complicated vehicle for cutting the benefits bill, says the Resolution Foundation

The MP withdrew from the Conservative leadership race last week after conceding he did not have adequate support from other MPs within the party (Rex)

The Government's flagship benefit reform has "serious" design flaws that must be resolved before being rolled out across the country, a new report has claimed.

The Resolution Foundation said Universal Credit had been taken too far away from its original purpose because of changes driven by planned savings in the welfare budget.

The think-tank said Work and Pensions Secretary Stephen Crabb, who pledged to press ahead with Universal Credit after taking over from Iain Duncan Smith, should "reclaim" the benefit from the Treasury.

Universal Credit, being put into place across the country, replaces income-based jobseeker's allowance, income-related employment and support allowance, income support, child tax credit, working tax credit and housing benefit.

The Resolution Foundation said it risked being reduced to little more than a complicated vehicle for cutting the benefits bill.

David Finch, senior economic analyst at the foundation, said: "As Universal Credit begins the roll-out of its full service this month, now is the right time for the new Work and Pensions Secretary to take stock of progress to date.

"It is a reform with lots of potential, but it has veered off track over recent years, particularly following a series of sharp cuts in support to workingfamilies.

"With UC's main goal of making work pay now under serious threat, the Secretary of State should reclaim the project from the Treasury.

"He should prioritise support on those most likely to respond, such as single parents and second earners, ensure UC does more to help those already in work to progress, and iron out some of the practical concerns that have arisen during the initial pilots."

The Government announced that UC was now in every jobcentre across the country for single jobseekers.

Over 450,000 people have made a claim so far, with over 9,500 new claims made every week.

Mr Crabb said: "All new single jobseekers across the country can now receive modern and improved personalised support through Universal Credit, marking an important milestone in the delivery of our welfare reforms.

"UC is transforming welfare and is central to our vision for our society where people of all backgrounds can earn a decent wage and provide for theirfamilies, with claimants moving into work faster and earning more than under the old system. Our focus now is on continuing its expansion to all claimants."

Welfare Reform Minister Lord Freud added: "The driving force of our reforms was to create a welfare system that allows people to break free of dependency and move into work.

"Universal Credit is that system - it is giving people the confidence, self-esteem, and security that only a job and a pay-packet brings. Across the country nearly a quarter of a million people are claiming Universal Credit and tens of thousands of them are now in work."

Responding to the Resolution Foundation report, a Government spokeswoman said: "The reality is that Universal Credit - which is now in all Jobcentres across the country - is transforming lives, with claimants moving into work faster and earning than under the previous system.

"For the first time we are also helping people to progress in their careers, and for families we are removing one of the biggest barriers to getting into work by paying for up to 85% of eligible childcare costs - something which was ignored by the Resolution Foundation."

Press Association