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Universal credit plan 'is a disaster in the making', says minister just months ahead of launchDavid Cameron's new benefits initiative 'set to fail'Universal credit scheme criticised by Cabinet ministerNew system will replace list of unemployment handouts
08:05 GMT, 31 December 2012
The universal credit scheme is a disaster waiting to happen, a Cabinet minister has warned.
The initiative, which is the centrepiece of David Cameron’s welfare reforms, is due to begin with a pilot scheme in April and a national roll-out in October.
Aimed at making it pay to return to work, the single benefit will replace a raft of unemployment and in-work handouts.
Heading for disaster: David Cameron's new benefits reforms are losing support in the Cabinet
But senior figures, including Chancellor George Osborne, have become increasingly concerned about whether the computer software needed for the 2billion project is on schedule.
One Cabinet minister was yesterday reported to have told friends: ‘The information technology for the new system is nowhere near ready. It’s a disaster waiting to happen.’
And Whitehall sources have confirmed the scheme has been put on the Treasury’s ‘watch-list’ of projects deemed to pose a significant risk.
Any problems would be embarrassing for the Prime Minister, who placed welfare reform at the centre of his new year message yesterday.
Work boost: The aim of the new benefits system is to encourage unemployed to get back to work
He said: ‘When people say we’ve got to stop our welfare reforms because somehow it is cruel to expect people to work, we are saying “No”.
'Getting people into good jobs is absolutely vital, not just for them, but for all of us.
'And when there is a fight on our hands to change our schools, we are ready and willing to have it because having a world-class education is the only way our children are going to get on in this world.’
Concerned: Chancellor George Osborne
Mr Cameron said the Coalition had ‘inherited a welfare system that was frankly out of shape, that paid people not to work’ – the problem the universal credit scheme is designed to solve.
Whitehall concern about universal credit centres on a vast IT system developed with HM Revenue and Customs, which is meant to give officials up-to-date data on an individual’s income.
The Department for Work and Pensions insists that early trials are encouraging but there are grave concerns elsewhere in Whitehall about whether it is ready to be rolled out to the entire country.
A source pointed out that Mr Osborne had included funding for the scheme in this month’s autumn statement on the economy.
The Chancellor supports the principle of the scheme but is said to be alarmed by the possibility of significant problems with such a high profile scheme affecting so many people in the run-up to the next election.
A spokesperson for the Department for Work and Pensions denied the scheme was in trouble, adding: ‘Universal Credit is on time and under budget. It will start to be rolled out nationally from October 2013, making three million households better off and ensuring work always pays.’