MPs doubt Whitehall can deliver welfare savings

A POWERFUL spending watchdog yesterday raised concerns about Whitehall’s ability to introduce fundamental reforms of the welfare system while cutting departmental running costs.

Under the government’s deficit reduction plans, the Department for Work and Pensions has to find savings of £2.7 billion by March 2015. It plans to meet half of that by the end of this financial year, but the cross-party public accounts committee (PAC) raised fears that the department “lacks a clear plan” to deliver the target.

Although officials told the committee they were confident the changes could be delivered, the PAC warned of “high risk” areas that could thwart that ambition. It cites the plans to introduce a Universal Credit – merging several benefits into a single payment – which it said was dependent upon new IT services.

The committee also warned the department was assuming running costs reductions “from an optimistic expectation” that 80 per cent of job-seekers would use online services when less than a fifth do now.

The committee in the past said it had often highlighted IT projects that had gone “off track”.

PAC chairwoman Margaret Hodge said: “The department does not yet have a clear plan for delivering these savings and we are concerned about its ability to do so effectively.”