A Review of Universal Credit

Transcription

1 A Review of Universal Credit Deven Ghelani Useful links: - Benefit Cap White Paper - Outcome- based sodware - Free Universal Credit Calculator - Universal Credit: Toward an effec2ve poverty reduc2on strategy

2 A review of Universal Credit Policy impact Prac2cal Impact Efficiency or Effec2veness? Doing more with less

3 About Policy in Prac2ce

4 The current benefit system

5 Universal Credit

6 The aggregate impact of Universal Credit is posi2ve Universal Credit will put more money in people s pockets and improve work prospects. 16/ Month 1.5m 14% 2.1m 4% Pockets: - Higher take- up - Keep more in work Prospects: - Higher work allowances - Lower MTRs

7 A Universal Credit Claim The Universal Benefit Calculator: brings the benefit system to life

8 but we know that some people will need support Low Need Number of Claimants 50% of JSA claimants find work with no extra support 60 80% online Medium Need Some claimant groups have predictable support needs. Who delivers these in your area? Job Search, Work Readiness, Childcare, Debt, Complex Need Local Authori2es work with Households that have significant and unpredictable support needs Educa2on, Criminal Jus2ce, Health / Care needs Vulnerability / Distance from Work

9 Efficiency vs Effec2veness DEL is about making services more efficient ; reducing running costs and avoiding duplication in service delivery. AME: DEL: AME where most welfare spend lies savings are easier to manage savings accrue to you DEL AME society and economy benefit... 93% of 49bn working age spend DEL JCP Effort DWP Cost AME is about making services more effecpve ; achieving outcomes and thereby reducing future demand. The current benefit system focuses on administering benefits It should focus instead on providing effecpve support

10 Process vs Outcomes DEL: Annual cost of a JSA claim ( ) New JSA claim 92 JSA Interview (new, 13wk, 26 wk) 59 JSA review (fortnightly) 8 Maintain JSA claim (p.a.) 306 ESA / IS claims are more expensive Plus HMRC administered benefit (Tax- credits) Plus LA administered benefit (Housing Benefit) AME: Weekly taxpayer saving in work (UC) Full 2me (35 x 6.08, ED= 10) Full 2me (35 x 7.10, ED = 10) Part 2me (16 x 6.08, ED = 10) Plus the economic benefits of work Plus the social benefits of work DEL cost of UC support ( ) Universal Credit: New Claim?? Universal Credit: Maintain Claim?? Universal Credit: CondiPonality?? Total DWP costs DEL Cost ( ) AME Cost ( ) A one per cent saving in AME is equal to more than a thirteen per cent reducpon in DEL expenditure 3.4bn 45.0bn A reformed welfare system that offers employer- led, customer focused support could get more people into work, sooner. Welfare Reform has the potenpal to save the country literally billions Out of work claimants (5m) spending on average one week less on UC would save the taxpayer 700m

11 Engage Residents VS

12 85% more likely to look for work Deliver Outcomes

13 Summary: Let s remember why Universal Credit is coming in The principles behind Universal Credit are sensible, and have broad cross- party support. UC will have a broadly posi2ve impact Both pockets and prospects improve for the majority, but the overall effect of welfare reform is mixed. Local authori2es have a cri2cal outcome- focused role to play Suppor2ng those that lose out from the overall package of reforms. Local support services will need to take an outcome- focused approach. Learn from each other evaluate what works in one area, and scale it up. Policy in Prac2ce can help Local authori2es need to design effec2ve local support, and engage residents. Frontline advisors need to Illustrate Universal Credit and other welfare changes quickly and clearly at a household level, to inspire ac2on. The local role will not be about how much is spent on the welfare system, but how well it is spent.

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15 To learn more about the impact of Universal Credit, and how local authori2es can take an effec2ve, outcome- focused approach contact me: Deven Ghelani Thank you. Consultancy Policy Outcome- based Sohware