The True Cost of Universal Credit

Guest Article by “Vicky” – reader and sceptic

What is the true cost of Universal Credit? According to recent press reports the cost of Universal Credit has risen from somewhere in the region of £2.2 billion to £12.8 billion. Both these figures are beyond comprehension for the average person to get their head around, so another way of looking at it would be 16348 Iain Duncan Smiths paid on a cabinet salary of £134,565 per annum compared to 95121 Iain Duncan Smiths paid the same salary for a year – Too many Duncan Smiths whichever way you choose to look at the figures. The £2.2 billion is said to represent costs to 2018 and the £12.8 billion is supposedly costs to 2021 – will Universal Credit still be around then?

Whatever the true monetary costs the figures presented do seem to be astronomical. Major projects do cost billions to implement; just take a look at the successful NHS IT project that the labour government started in 2002 and then the coalition scrapped in 2011 which allegedly wasted £12.7 billion. According to the major projects authority Universal Credit is on amber/red status – in danger of failing (the same as HS2), surely in these times of austerity our esteemed politicians are not going to waste even more tax payer revenue and scrap another major project? I have gone off track somewhat here but I do feel strongly about the wasting of money by political purse string holders.

The bedroom tax debate rages on with terrible stories in the press regarding hardship faced by many many households even resulting in a suicide in May. The reduction in housing benefit payments paid to claimants with a “spare room” seems to be a ridiculous idea brought in overnight, surely a more sensible approach to this would be a gradual reduction in benefit but only when a tenant has been offered suitable alternative housing. To expect people (many disabled) to face a cut in benefits so severely really is ill thought out and lacks compassion for fellow humans on all levels.

Welfare reform is needed in our country but at what cost? Do we simply cut away benefits and put a nice slant on it by saying we are “aiming to make work pay” – a nice slogan but is that all it is? Many charities such as the Joseph Rowntree Foundation have concerns over Universal Credit “The introduction of Universal Credit is taking place at a time of low employment and an unstable labour market. Underemployment, which means the number of people lacking the paid work they want, stands at 6.5 million. The number working part-time but wanting full-time work is now 1.4 million, up by 500,000 since 2009. There are also major design issues, especially with its IT systems. There are risks around the move to online interactions, banking, monthly payments and payments to a single individual in the household. These need testing in the pathfinder and revising where necessary as Universal Credit is rolled out. We support the principles behind Universal Credit, but don’t yet know whether in practice it will be better than the old system. We will be monitoring its impact”. 

The pathfinder needs to address many issues and iron out many faults, whether just one pathfinder of a limited number of claimants rather than the originally intended four can achieve this before October is debatable to say the least.

I am lucky, so far in my life I have never claimed benefits, however I still care about the many people in the UK that are unfortunately in need of benefits and are now facing cuts that threaten their basic needs. Therefore I ask the question again; what is the true cost of Universal Credit?



  1. Hi Vicki

    I would just pick up on “Welfare reform is needed in our country…” and say that I think this government rhetoric shouldn’t be taken for granted. It is one of those things that gets bandied about and no one seems to want to challenge – including the Opposition and any number of other organisations and individuals.

    Personally I think welfare is great. The more money you spend on individuals, the better it is likely to be spent. As you say, those who hold the purse strings are notorious for wasting money. If you divided up those extra IDSs you mention above, and gave that money direct to the people, they wouldn’t spend it on daft schemes – they’d spend it on food and housing for themselves and their families – and also on a little recreation to break the monotony and keep themselves de-stressed, sane and healthy.

    In my opinion every penny spent on welfare is money well spent, and is money not spent on nuclear weapons, fracking or goodness knows what other damaging capitalist schemes.

    Cathy (feeling a bit grumpy and radical today)

  2. Vicky Goddard says:

    Hi Cathy,

    I’m glad I’m not the only one who is so frustrated at the way politicians seem to waste money at an alarming rate.


  3. michael craig says:

    I’m saddened that even the Joseph Rowntree Foundation have fallen for the spin on the ‘principles behind Universal Credit’.
    Universal credit is not the same as a universal basic income. An income can only be universal when it is given to everyone, U.C. is a means tested benefit therefore cannot by definition be given to everyone.
    The principle behind U.C., as with any means tested income, is to create division – to create a class within a class. Rather than end a culture of dependency, as the government claims, a greater emphasis on means testing creates dependency. Conversely, a non means tested, truly universal income creates citizenship and full participation in society.

  4. I’m disgusted. How people are being treated animals would not be treated this way ! (I love animals ) there has been no thought of human rights and decency if the people the reform is effecting the population . Especially how the sick disabled and aged and mentally ill have been targeted as easy pickings to bully ? People are desperate. Hungry jobless skint then have bedroom tax forced on them and having pay an extra £20 taken from them for council tax bed tax on 2 room under occupy is £ 23. 56 a fortnight extra to find to already on low income these changes have pushed people to the edge kids hungry what will happen this winter ? Extra costs on fuel bills how di we cope ? A man walked into a job centre cut his own throat because they were not listening to Him he could not live on the benefit as it is now could end up homeless already hungry basic needs cannot be met on these reforms ! Zero hour pay ? It’s criminal act against humanity .


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