IDS under fire over Universal Credit ‘shambles’

Iain Duncan Smith, Work and Pensions Secretary, has faced criticism over his benefit reforms. Picture: Getty

The Work and Pensions Secretary insisted problems highlighted in a damning report by the National Audit Office (NAO) were “historic” and he had already intervened to sort them out.

In fiery Commons exchanges, Mr Duncan Smith also branded Labour counterpart Liam Byrne “pathetic” for suggesting he should apologise for the state of the project.

Universal Credit is due to replace a bundle of means-tested benefits by 2017, with the department estimating it will save £38 billion in administration, fraud and error by 2023. It is also designed to encourage people to take up work by ensuring they will always be better off having a job.

But pilots have been scaled back and delayed, and a former Olympics executive was drafted in earlier this year to “reset” the programme.

The NAO criticised “weak management, ineffective control and poor governance” of the scheme, saying that of £303 million spent on IT up to April, £34m had been written off and the systems still had “limited functionality”.

It found the IT system could not identify potentially fraudulent claims, meaning manual checks were needed on claims and payments. “Such checks will not be feasible or adequate once the system is running nationally,” it added.

“Delays to the roll-out will reduce the expected benefits of reform.”

Mr Duncan Smith strongly defended the project he has championed, telling MPs: “In the summer of 2012, or rather before that, in early 2012, I instigated an independent review because I was concerned that the leadership of the programme was not focusing in the way that it needed to in delivering the programme as it was originally set out.

“This internal report showed me quite categorically that my concerns were right, that the leadership was struggling and that there was a culture of good news prevailing and that intervention was required.”

However, Mr Byrne told the minister: “To hit your deadline at the end of 2017, you must now move over 200,000 people a month on to the new system. That is a city the size of Derby.

“The PAC [Public Accounts Committee] will no doubt consider the changed timetable, the IT shambles and the write-offs, the lack of counter-fraud measures, the shambolic financial control and the lack of financial oversight.

“But what I want to say to you is this – you have let this House form a view of Universal Credit which the nation’s auditor says is wrong.

“The most charitable explanation of this is that you have lost control of the programme and you have lost control of the department. You must apologise to the House”

However, a clearly angry Mr Duncan Smith accused Mr Byrne of being “pathetic”.

“When I got concerned about the delivery schedule, I made changes and I intervened.

“I have brought the right people in to do this and I stand by that. I will not take lessons from you and your party,” he said.

PAC chairwoman Margaret Hodge said: “The DWP has made such a mess of setting up Universal Credit that the Major Projects Authority had to step in to rescue the programme.”