This report aims to provide a description of Universal Credit as a digital welfare system and make recommendations for its future development.
Universal Credit is a hyper-means-tested benefit based around a monthly payment and a regime of activities that change in response to the earnings, circumstances and behaviour of claimants, and a digital account. It is highly opinionated in how it relates to family and financial circumstances, and is based around a particular view of what constitutes ‘personal responsibility’. It is at once a political project that attempts to reward or compel particular behaviours from the public and a more prosaic reform of the welfare system in the digital age.
The Universal Credit ‘digital account’, along with other digital services developed by the Department for Work and Pensions (DWP), has been critical to the delivery of Universal Credit. DWP has been able to develop these services, and respond to policy changes, in part, because of the effective digital team it created in response to the initial failure of the project in 2013. With this capability in place, the department has demonstrated it can not only deliver new digital services but make changes quickly and competently.
DWP’s competence in delivering and iterating its digital services means it is increasingly hard to ‘blame the IT’ when it comes to the impacts and effectiveness of Universal Credit. This raises questions about the trade-offs the department is making between reducing costs, the intent of the policy, and the needs of claimants.
Only by examining how the digital elements of Universal Credit manifest themselves to end-users is it possible to make practical recommendations for the future. It is also key to improving the debate around Universal Credit for policymakers and campaigners alike. However, the lack of public documentation, the personalised nature of Universal Credit, and the bi-weekly changes DWP makes to its digital services, makes this a difficult task.
Part 1 of this report documents the development of the political origins and conceptual framework of Universal Credit, how DWP develops its digital services and responds to policy changes. Part 2 summarises what is in the public domain about how Universal Credit manifests itself to claimants and details the gaps in information about how it functions. Part 3 uses this background information to identify issues with the digital aspects of Universal Credit and make recommendations in the five broad areas below.
1. How the Universal Credit policy framework functions in practice as a digital system
The complex and opinionated nature of Universal Credit has conspired with the variation of real people’s lives to push administrative, financial and cognitive burdens onto claimants. Far from encouraging responsibility, it makes decisions for claimants, sets defaults in line with a policy vision that, ten years on, fails to ‘mirror the world of work’, and puts the majority of applicants immediately into debt to the department.
Despite some changes to the policy over time, core principles such as the monthly payment cycle and how payments are split between claimants and landlords, remain unchallenged. No amount of user centred design can remedy these and it is time to seek alternative options.
The concept of ‘responsibility’ in Universal Credit should be redefined to become less about conformity with a particular worldview, and more about ensuring the desired outcomes are met with the grain of people’s lives, rather than against it.
2. An assessment of whether the advantages of digitisation are being shared fairly between DWP and claimants
DWP has shown that it is entirely possible to offer claimants alternative payment cycles and ways of splitting the payments between partners and landlords. Continuing to treat these as exceptions, rather than options that can be easily chosen by claimants, is a policy choice rather than a constraint of the technology.
In addition to issues of digital inclusion, which have been covered in detail by others, there is a key question about the digitisation of the welfare system: are the benefits of digital being shared equally with the public? Currently, the answer appears to be no.
Critical parts of the Universal Credit policy, such as appeals, have not been digitised at all, and options that empower claimants to take greater responsibility by choosing how Universal Credit works for them are obfuscated or missing.
DWP’s focus on automation prioritises its efficiencies over those of the public. There are huge opportunities to use the data that DWP holds to reduce administrative burden, speed up payments and improve how it communicates with claimants, but these have not been prioritised. It is also not sufficiently transparent to claimants when and how automated decisions have been made.
3. The case for rethinking Universal Credit as an open platform, so that civil society might better support claimants, and government might operate more effectively
Universal Credit remains a stubbornly closed system. Third parties find it hard to support claimants and must interact with the digital account on DWP’s terms. By rethinking Universal Credit as a shared platform, and by understanding the needs of civil society organisations, there is an opportunity to meet needs that DWP either cannot or will not meet.
This approach could also improve how data is used within government. Today, too many claimants fall down the gaps between government systems, particularly the systems of DWP and HM Revenue and Customs (HMRC). Taking a cross-government, platform approach to HMRC’s Real Time Information (RTI) system could reduce payment errors and increase claimant’s trust. There are also opportunities to improve how data is used by local government and how claimants prove their right to things like free prescriptions.
4. An examination of the ethical and privacy implications of a hyper-means-tested benefit
In addition to the higher administrative burden created by a hyper-means-tested welfare system, there are also implications for claimant’s privacy and trust in government. Collecting additional data to personalise, target or means-test a service comes at a cost to a user’s time and their privacy. There is a strong case to be made to review the data Universal Credit requires to personalise and means-test, and to look for opportunities to rationalise it. There should be a fair assessment of the utility in meeting a policy outcome, versus the additional administrative burden for a claimant and the impact on their privacy and trust.
5. The need for new forms of transparency for digital public services like Universal Credit
Much greater transparency is needed around how Universal Credit works, how it is changing, and how it is performing.
Transparency may seem like a peripheral concern relative to other issues created by Universal Credit, but it is not. The digitisation of public services means that the choices of service designers and software developers have become critical in how the public access services to which they have a legal right. Without adequate information, there is a risk of dilution of public understanding of how public services function. There is also a risk of information asymmetry between government and civil society, where the government has a fine-grained, real-time view of how the public are using a service, but those wishing to hold the government to account for its actions operate largely in the dark.
DWP should aim to make accountability, understandability and trust, core design principles of the Universal Credit service. It should also work to better understand the needs of organisations who might hold it to account.
By publishing more information about how Universal Credit works, opening up the development process and rethinking how it publishes data and statistics, DWP could make Universal Credit into an exemplar of transparency for a digital public service. This could provide leadership across the public sector in the UK and worldwide, but would also highlight the very real efforts DWP has made to learn from the challenges of digitising a complex policy.
The working-age welfare system is critical to British society, and its digitisation raises questions that transcend welfare reform. As the roll-out of Universal Credit gets closer to completion, there is an opportunity to use the capability the DWP have built to ensure that the welfare system works for everyone. This will require much greater opening up of the digital aspects of Universal Credit and an impartial assessment of which parts of the original policy framework have failed.