Universal Credit: “shocking absence of control” will lead to £140m Write Off

A Parliamentary accounts committee report published today says management of Ian Duncan Smith`s flagship Universal Credit programme has been “extraordinary poor”

The Reports says some of the IT assets that have been delivered cannot be used in the programme and so “must be written off whilst initial estimates suggest the write-offs could amount to at least £140 million”

The cross party committee of MP`s also doubt whether the flagship programme can be delivered “on time and on budget” as Mr Smith has repeatedly claimed

The committee uncovered “shocking absence of control” it said;

“We saw evidence that purchase orders with a total value of £8.7 million were approved by a personal assistant to the Programme Director”

“In another case, two purchase orders, one for £22.6 million and one for £1.1 million, were approved by a personal assistant to the Programme Director”

The pilot programme -Pathfinder, which Shotton job centre is part of, has also been heavily criticised, the report says;

“The scope of Pathfinder is much narrower than originally planned. It is now restricted to only the simplest new claims of people who are single, have no dependants and would otherwise be seeking Jobseeker’s Allowance, the Pathfinder does NOT deal with most claimants.

Other highlights;

• The committee said it is extremely disappointing that the litany of problems in the Universal Credit Programme were often hidden by a culture prevalent in the Department which promoted only the telling of “good news”

• There has been a shocking absence of control over suppliers with the Department neglecting to implement basic procedures for monitoring and authorising expenditure.

• The pilot programme is inadequate as it does not deal with the key issues that Universal Credit must address: the volume of claims; their complexity; change in claimants’ circumstances; the need for claimants to meet conditions for continuing entitlement to benefit; and the security of information to prevent fraud.

• The lack of oversight allowed the Department’s Universal Credit team to become isolated and defensive, undermining its ability to recognise the size of the problems the programme faced and to be candid when reporting progress.

• There has been a shocking absence of control over suppliers with the Department neglecting to implement basic procedures for monitoring and authorising expenditure.

Margaret Hodge said

“From the outset, the Department has failed to grasp the nature and enormity of the task; failed to monitor and challenge progress regularly; and, when problems arose, failed to intervene promptly.

“Lack of day-to-day control meant early warning signs were missed, with senior managers becoming aware of problems only through ad hoc reviews.”

Responding to the report a DWP spokesperson said;

“Universal Credit is a vital reform that rewards work instead of trapping people on benefits. It will ultimately bring a £38 billion economic benefit to society.

“This report doesn’t take into account our new leadership team, or our progress on delivery. We have already taken comprehensive action including strengthening governance, supplier management and financial controls.

“Since we have last spoken to the PAC, we have also launched Universal Credit in Hammersmith, which will expand to further areas later this month and the Claimant Commitment is rolling out to Jobcentres across the country

 

Links:

Public Accounts Committee report 

Response to the Public Accounts Committee (PAC) report