Tories Overall Benefit Cap = homeless epidemic = Chronic ignorance of fact!

A couple will three children will get nothing in Housing Benefit by 2027* and due to the Tories Overall Benefit Cap (OBC) policy.  This will see a catastrophic homeless epidemic in the UK possibly making tens times more homelessness than we have today.

Here I present some figures which are all facts and all known facts today that will explain why we will inevitably see a homeless epidemic and mass evictions from even the cheapest council housing and even council landlords will be operating what we know as NO DSS allocation policies. This not conjecture or scaremongering it is, regrettably all logical and predictable and inevitable.

Chart 1 – The percentage of average social rent paid by Housing Benefit 2019 – 2039


Today in 2019 the average social rent for a three-bed property is £102.59 across the UK and is the (minimum) size of property the two parent three child household have as their housing need.  Yet because of the way the Overall Benefit Cap policy works the maximum Housing Benefit the 2P3C household receives is £61.17 per week and thus Housing Benefit pays 60% of the rent.

By 2021 Housing Benefit will only cover 43% of the average social rent as the maximum HB will be £46.78 per week and the average social rent will be £109.26.  Three issues combine for this to happen:

  1. The OBC limit is a constant cap that stays at the same figure
  2. Welfare Benefits are to rise in line with CPI inflation (2.2%)
  3. Social housing rents are to rise by 3.2% in England [CPI+1%]

Each subsequent year the same three factors above occur and as the Chart above shows in 2023 the 2 Parent with 3 Child household get just 27% of their rent paid in Housing Benefit as the maximum Housing Benefit (or its UC equivalent) due to the OBC policy is £31.75 per week and the average social rent will be £116.37 per week.

Rather than creating a separate chart for each household I have included a data table below which has the percentage of average social rent that Housing Benefit will pay for each household type.

Table 1 – Percentage of social rent HB pays according to household composition

obc data table

The heading 1P3C means the 1 parent 3 child household; 2P1C is 2 parent 1 child etc., and the methodology is the same as explained above using CPI of 2.2% thus benefit income increases 2.2% each year and social rents increase 3.2% each year.

What the data table reveals is ever smaller families cannt afford the cheapest rented housing and the cheaperst social landlords cannot afford to accommodate the benefit tenant household.

That means existing tenants will build up arrears rapidly and be evicted.  It further means that council and housing association landlords will not allocate the 400,000 or so new tenancies they have each year with the benefit household (aka NO DSS).

Both the existing tenants and prospective tenants will be homeless because of this and hence the homeless epidemic will happen … unless the Overall Benefit Cap policy is abandoned as this is what causes the homeless epidemic (with help from inflation-busting council and housign association rent rises.)

General Comment

Last week saw two significant and linked housing and bnefit announcements.  The DWP did a U-turn on child tax credits for the 3rd and subsequent child if they were born before April 2017.  This means those households keep the £53.50 per week / £2,780 pa Child Tax Credit from February onwards yet because the Overall Benefit Cap policy is a zero sum policy it means they can receive £53.50 per week and £2,780 pa less in Housing Benefit.

The second was the Shelter Commission Report that called for government to invest £10.7bn per year for the next 20 years (until 2039 – the same as my data table) to build 155,000 new homes per year at the social rent level.  Yet what is the point as these 3.1 million new social rent homes are unaffordable to the tenant in receipt of social security benefit and again due to the OBC policy aided by inflation-busting social landlord rent increases.

YET the great and the good of the housing and homeless sectors and the MPs and former MPs and the economists who formed this Shelter Commission totally ignored the Overall Benefit Cap in their considerations and figures.  For this reason the Shelter Commission Report and its conclusions and recommendations are literally not worth the paper they are written on and the Shelter Commission Report (SCR)despite its hyperbole and high-profile is utterly meaningless.

The SCR was an attempt to solve the UK Housing Crisis and it cannot be a solution to it.  The OBC as the figures which are facts and undeniable facts show that the UK Housing Crisis is about to get much, much worse as evictions from social housing and NO DSS being the norm for all new allocations means that the UK Housing Crisis is more correctly called the UK Homelessness Crisis and IF the three critical factors remain of (i) the cap stays and stays a constant, and (ii) benefits are uprated by CPI and (ii) social rents are uprated by CPI+1% then UK homelessness could easily rise ten-fold over the next ten years!

The current Government has a target to cut rough sleeping (just one aspect of homelessness) in half by 2022 and eradicate it altogether by 2027.  That aim and policy initiatives to get there are also meaningless due to the OBC policy.

Council and housing associations – the social landlords as they are known – have almost 40% of all their housing as a 3 bed property or larger.  Yet within a few years no benefit household that would fully occupy a three bed house can afford one due to the massive cuts in housing benefit caused by the OBC.

As far as all the hundreds and hundreds of thousands who will be evicted from the social rented sector and face NO DSS from the scial rented sector (and the private rented sector) one question – Where the hell are they going to live?

The answer can only be temporary homeless accommodation such as hotels and bed and breakfast hotels.  And the only way they can get out of that unsuitable and incredibly costly accommodation is to get a job.  It is not scaremongering or even flippant to say that the Tories OBC policy creates an environment of NO JOB, NO HOME as that is exactly what it does create and obviate.

In conclusion, this also means the housing safety net created as one of five central and interrelating pillars of the 1948 Welfare State is dead.  No other element of the venerated Welfare State would be allowed to be changed with such ignorance and such neglect.  This OBC policy not only increases homelessness ina way never seen or even imagined before it will massively increase costs to every other part of the public sector that the taxpayer pays such as social services, care sector, the health service, the criminal justice system, the education and just about every other public sector activity.

This is madness and unbelievable neglect by politicians in government and opposition and by the so-called ‘great and good’ of housing, homelessness and wider social welfare policy.  The Overall Benefit Cap policy has to be stopped and stopped yesterday.


* ‘Nothing’ except a token 50 pence per week which is what the OBC policy gives




No job? Kids? Then you’re homeless is Tory policy. Why don’t Shelter know this?

The Overall Benefit Cap policy which limits a household to £20,000 per year in ‘welfare’ and £384.62 per week will mean that in 2027 the two parent three child household will not get a penny in housing benefit.

Is it irony for the Shelter Commission report this week investigating social housing for the next 20 years has a picture of a mother and child on its cover and a lone parent with one child in 20 years will not be able to afford the cheapest council housing Shelter demand is needed due to the Tories Overall Benefit Cap policy?

shelter commission

This week the DWP announced that tax credits will be paid for the 3rd child (if born before 2017) and that welfare benefits will rise and be unfrozen and I assume they will rise by the CPI rate of inflation.


The quick table above shows that in 2019 the two parent three child household (2P3C) gets £323.45 in ‘welfare’ plus a maximum of £61.17 in housing benefit.  The table then increases the £323.45 other welfare figure by 2.2%, the current CPI rate of inflation, each year and by 2027 this reaches the Overall Benefit Cap limit of £384.62 meaning the 2 parent 3 child household will not get a penny in housing benefit.

Where will they live?

Council and housing association landlords will not house them as they cannot pay the rent, they cannot afford the rent and what we have is the cheapest rented housing that will call social housing will see social landlords operating a blanket NO DSS policy as private landlords have done for decades.

Using the same method of welfare increasing by CPI in 2034 the lone parent with 3 child household will not get a penny in housing benefit and in 2038 the two parent 2 child household will not get a penny in housing benefit.

The Overall Benefit Cap (OBC) policy kills off the 1948 Welfare State housing safety net and directly creates ever-increasing homelessness with its systemic flaw that I first mentioned in 2012 of its cap or limit remaining a constant while ‘welfare’ and rents both increase.

The OBC means the social landlord model is dead as the proverbial Dodo as councils and HAs will not house those in housing need as they simply cannot afford to.  I cautioned social landlords at their euphoria over the return of inflation-busting rents from 2020 (CPI inflation plus a further 1%) that will also lead to NO DSS for their 400,000 social housing lets they have each year and of course for the mass eviction of existing tenants that the combination of welfare and rent rises will create as an unambiguous inevitability.

NO JOB NO HOME as well as NO DSS becomes the norm for council and housing association landlords

Look at the following table for the lone parent 2 child household which uses the same method of welfare rises of (2.2%) CPI inflation and social housing rent rises of 3.2% and CPI plus 1%


By 2027 the lone parent with 2 children will get a maximum housing benefit of £129.33 and the rent will be £131.99 and a shortfall arises of £2.66 per week.  Yet 2 years after that in 2029 this housing benefit shortfall has increased to £22.60 per week and in a further two years by 2031 doubles to £43.60 per week … which means that councils and housing associations in the cheapest rent areas of the UK cannot afford the ‘benefit tenant’ with 2 children. It means the eviction of existing lone parent two child households and denies the allocation of social housing to them (NO DSS)

It further means that council and housing association landlords can ONLY house those in work for the near 40% of all social housing that is 3 bedrooms or larger.  The benefit tenant ghetto is what council and housing association housing becomes. It also means any household with two children cannot live anywhere if they have no job. It means NO JOB NO HOME.

This past week has also seen the Shelter Commission Report that calls for 3.1 million social housing properties to be built over the next 20 years or 155,000 new houses described as ‘genuinely affordable’ and meaning houses are social rent.  Yet what is the point if none of those allegedly ‘genuinely affordable’ houses will not be allocated to the benefit households or those most in housing need due to the OBC and inflation-busting social rent rises?

The OBC policy means NO JOB NO HOME and means NO DSS in even the cheapest rented properties of council and housing association landlords.

The Shelter Commission report claims to look at housing until 2039 yet by that time the lone parent with 1 child household will have a housing benefit shortfall of £35.63 per week in the cheapest form of social housing.  Hence by 2039 at the latest council and housing association landlords will not house any benefit tenant household who has children!!

Remarkably the OBC policy has an approval rating of over 70% and just as offensively the last Labour Party general election manifesto called for a reduction in the OBC limit – both of which show that the electorate and all politicians don’t have a clue about the OBC policy and what it inevitably means which is I remind again NO JOB NO HOME and NO DSS being the norm and the eradication of the 1948 Welfare State.

The Tory OBC policy not only has the cap as a constant figure and with it the systemic flaw but in 2017 the Tories reduced the cap by 23% from £26,000 per household per year to £20,000 per household per year (and to £23k pa in London.)

The Shelter Commission did not mention the OBC policy and did not consider it in their report despite the fact it will systemic create ever-increasing homelessness and NO DSS in the cheapest rented housing that we misname social housing.  Excuse me reader but isn’t Shelter’s rationale to fight homelessness and yet they do not even see the inevitable OBC impact of mass homelessness and mass social housing NO DSS!!

Note well that figures unlike politicians, lobby groups and social landlords DON’T LIE and when the creation of those figures is THE most basic of basic spreadsheets that a 7 year-old can do then why the hell can’t politicians, landlords and the likes of the Shelter Commission take 2 minutes to create such as simple spreadsheet?

All of these actors claim to care about homelessness yet they do not know their arse from their elbow when it comes to the systemic creation of ever-increasing homelessness do they?


NO JOB, NO HOME – is what the 2 child U turn means.

Amber Rudd the DWP Minister announced a U turn on benefit / welfare for the family with more than 2 children.  The national media view is that this is a good change.

The reality is that it is a disgraceful change that amounts to NO JOB NO HOME and an increase in poverty and homelessness and the detail which is not hyperbole but fact I discuss below.

The U turn

The DWP is allowing families with for example 3 children to keep the £53.50 per week they get for the third child instead of taking this away from them when they move to Universal Credit (assuming third child born before April 2017.) What all of the media reports have missed is that the DWP will take away £53.50 per week by reducing the household’s maximum housing benefit by £53.50 per week per child over the first 2 instead in the policy called Overall Benefit Cap or OBC.

This actually places the families at much greater risk of eviction and is a much worse form of poverty.  It is better to be in your own home and be skint than to be homeless and skint is the reality and why this change is much worse and why this change creates an added and worse form of poverty in homelessness.

Overall Benefit Cap and how it works

The OBC is a policy that sets an overall limit or cap on the amount of ‘welfare’ (social security benefits plus child tax credits) a household can receive.  This cap limit is £442.31 per week in London and £384.62 per week in the rest of the UK.

The MOST critical point is how this OBC cap works, its process, which is simple yet not widely known as the primary and often only benefit that is cut is housing benefit.  The process is the cap figure is taken and from it is deducted the total amounts of IS / JSA / ESA + all Child Benefit + all Child Tax Credits.  What is left over, if anything becomes the maximum amount of housing benefit that the household can receive to pay their rent.

A worked example for a 2 parent with 3 child household (weekly)

  • Couple rate of base benefit                £114.85
  • 1st Child amount of Child Benefit     £  20.70
  • Child Benefit for 2nd & 3rd child        £  27.40
  • Child Tax Credit for 3 children          £160.50

Total                                                                  £323.45

This total of £323.45 is subtracted from the OBC limit and gives a maximum amount of housing benefit received at £61.17 per week in the regions [£384.62 cap less £323.45]; and in London a maximum housing benefit figure of £118.86 per week [£442.31 less £323.45.]

A couple with 3 children have a housing need for a 3 bedroom property yet nowhere outside of London can this be afforded with a maximum HB of £61.17 per week.  Similarly this household could not afford any 3 bed property in London with a maximum HB of £118.86 per week!

This creates NO JOB NO HOME and that includes the cheapest council housing.

Because housing benefit or its UC equivalent of housing costs payment does not cover the cheapest council rents then social landlords will have to evict existing social tenants and will refuse to rehouse new applicants because housing benefit does not cover the rent.

Those affected by the U turn announcement get no more money.

The £53.50 for the 3rd child that the government is saying is an increase results in a £53.50 deduction in the maximum housing benefit payable.  If the household has 4 children and 2 more than the old 2-child limit then the £107 per week ‘extra’ in child tax credits is met with a £107 reduction in the maximum housing benefit they will receive.

I mean no slight on council and housing association landlords I am merely stating the obvious.  Social landlords stopped renting to those who would under occupy as a result of bedroom tax policy and stopped renting to the larger families who couldn’t afford the rent due to the Overall Benefit Cap policy.

The University of Sheffield / CIH report of 2017 Tackling Homelessness Together revealed that social landlords are refusing to accommodate those for whom HB does not cover the rent – a point I presented to a CIH conference back in early 2014 as being inevitable – and that refusal to accommodate which is in lay terms a policy of NO DSS that will continue and indeed worsen because of Rudd’s U-turn.

Every change in any welfare benefit policy has a domino effect and because Universal Credit is a replacement for six separate ‘benefits’ we find that UC changes have even more impacts.

Another example was the announcement that the ‘benefit freeze’ will be lifted and which means social security benefits will increase. IF benefits increase by the CPI rate of inflation, currently 2.2%, and which is highly probable then the £323.45 figure I use to illustrate above will increase by 2.2% to become £330.57 per week … yet the OBC limit remains a constant at the £384.62 … which means the maximum housing benefit payable per week falls from £61.17 to £54.05 in Year 1.

The following year the same process continues and the £330.57 becomes £337.84 which means the maximum housing benefit payable falls to £46.78 per week – and keeps reducing each and every year = more and more NO DSS operated by council and housing association landlord and more homelessness.

Yet there is a double whammy effect of rents increasing and the Tories have announced that social housing rents will increase by the CPI rate of inflation PLUS a further 1%.  So imagine today the two parent three child household who now receives a maximum £61.17 in housing benefit and the 3 bed social housing property is £102.57 per week which is the average figure.

The simple table below explains the systemic flaw in the Overall Benefit Cap policy that I developed back in 2012.  Because the cap limit remains a constant figure AND social security benefit increases by inflation AND because social housing rents increase by more than inflation the impact on the maximum housing benefit a tenant can receive reduces markedly each year.

obc 2p3c

In the above worked illustration we see in just 3 years the amount of the housing benefit shortfall each week has doubled and the policy of NO DSS being operated by council and housing associations is an inevitable one not a slight on their social purpose.

When the Overall Benefit Cap policy began in 2013 it affected the households in social housing with 5 children or more in the regions.  It now affect families with 3 children in the lowest rent areas and shortly will see NO DSS policies affecting families with 2 children and a few years later the family with 1 child will not get enough in housing benefit to cover the cheapest council rent!

This is what the ignorant media and ignorant politicians missed with the Amber Rudd announcement and U turn on child tax credits and it does mean NO JOB then NO HOME


Tax credit U -Turn and Amber Rudd to scrap the Bedroom Tax

Amber Rudd the DWP Minister is to reverse the no more than two child tax credit policy today which is being touted as a U-turn by the BBC, which it is, and stated by CPAG to be “fantastically good news” … which it most certainly is not as I explain here.  It also means Amber Rudd believes the Bedroom Tax is unfair and should be scrapped! You couldn’t make it up could you!

ruddy nonsense

The detail of tax credit U-Turn and interplay with Overall Benefit Cap

15,000 more families will be put at acute risk of eviction and homelessness due to the Overall Benefit Cap policy is why this cannot be described as good news at all and especially not fantastically good news.

Simply, this £2,780 per child per year more they will receive means £2,780 less per child per year in Housing Benefit or its Universal Credit equivalent so a household with 4 children and two more than the previous 2-child limit will get £5,560 more in Child Tax Credits and the same £5,560 less in Housing Benefit.

The U-Turn

The opening of the BBC article on this tells us what the apparent changes are and all outlets are running the same detail:

About 15,000 families no longer face having their benefits capped after the government performed another U-turn over its flagship universal credit. The work and pensions secretary has ditched plans to extend a benefits cap on families of more than two children.Amber Rudd said those with children born before the system began in 2017 would remain exempt, as she aimed to ensure it was “compassionate and fair”.

The Child Poverty Action Group said the decision was “fantastically good news”.

However, the group is still calling for the two-child cap to be scrapped for all other families. Labour said the change “does not go far enough”.

The BBC article, its comment and that of CPAG all miss the very significant way this U-turn will interact with another welfare reform policy of the Tories in the Overall Benefit Cap (OBC) that limits households to £20,000 per year in ‘welfare’ (social security benefit plus tax credits) which is £384 per week.

How the OBC works for a household and 3 children

The OBC policy starts with the OBC limit of £384 per week. Then deducted from this £384 cap limit are:

  • The base benefit (Income Support / JSA / ESA) of £73.10 per week for a lone parent
  • The amount of Child Benefit which for 3 children is £48.10
  • The amount of 3 lots of Child Tax Credit of £160.50

That comes to £281.70 per week for a lone parent 3 child household and leaves a residual maximum amount of £103 per week that can be paid as the maximum Housing Benefit figure – or in London a maximum Housing Benefit amount of £161 per week as London has a higher OBC limit of £442 per week and £23,000 per year.

If the household is a two parent one the extra base benefit is £41.75 per week (£114.85 for a couple compared to £73.10 for lone parent) and so the household in the regions will have a maximum Housing Benefit entitlement of £61 per week and in London a maximum Housing Benefit entitlement of £100 per week.

Try finding a 3 bed house which is the housing need of a household with 3 children with a maximum HB amount of £61 per week. Or try finding one in London with a maximum HB of £100 per week and the point becomes clear.

This change only happens when the household moves on to Universal Credit and which means the HB element of the UC payment will be paid directly to the tenant not the landlord.  How many social landlords will thus refuse to house such a household based on the premise that they cannot afford the rent with this change?  The answer is every one of them.

That aspect has always been the problem with the Overall Benefit Cap policy as it forces the so-called social landlords to operate a NO DSS allocation policy.  It was a slow burner of a policy as the original £500 pw cap was a fixed constant from its introduction in 2013 and as Child Benefit, base benefit and rents increased it gave a lower figure as the maximum HB that could be paid.

From November 2017 the Tories then decided to go much further and reduce the £500 constant OBC limit to £442 pw in London and £384 per week in the rest of the UK, respectively swingeing cuts of 11.5% and 23%.

The Bedroom Tax dimension

The same BBC article sees the Chair of the All Party Working Group on Work and Pensions, Frank Field be equally ignorant of this overall benefit cap policy, ignorant of tax credits and ignorance of the Bedroom Tax (so no change there then!) :

Former Labour MP Frank Field, who chairs the work and pensions committee, said: “I strongly welcome the secretary of state’s decision not to press ahead with what could have been the cruellest benefit cut in history. “At the eleventh hour, she has prevented thousands of children from being plunged into poverty by an unjustifiable retrospective policy.”

They will still be plunged into poverty Mr Field and a worse version of that as existing households will be evicted and plunged into the greater poverty of homelessness as this U-Turn interacts with the Overall Benefit Cap policy.  Has anyone noticed the bedroom tax dimension here?  Frank Field most certainly hasn’t!

Amber Rudd,according to the BBC article will say:

On the two-child limit, she will say in her speech later that it was “not right” for it to apply to those who had their children before the cap was announced. “These parents made decisions about the size of the family when the previous system was the only system in place,” she will say.

Amber Rudd like Frank Field will know and realise that this ‘retrospective nature’ is exactly the same principle as the bedroom tax  policy.  Families chose and were allocated their family homes when the bedroom tax policy was not in place.  So why have they been hit by the retrospective bedroom tax Amber Rudd?

The Tory position on the bedroom tax ignores this same retrospective issue. These parents made decision about the size of their family when the previous system was the only one in place is a very telling phrase and rationale minister!

The Tories not only ignored the retrospective aspect of the bedroom tax, they closed the mistake they made in the Pre-1996 issue that meant for the first year of the bedroom tax they wrongly applied the bedroom tax to over 40,000 households and cut an average of £700 or so from their Housing Benefit.  Then they changed their mistakes to ensure that retrospection did apply in the Bedroom Tax.  Now, apparently, retrospection is unfair in the Tory welfare benefit policy lexcicon.

I look forward to the DW minister amending the bedroom tax policy to disapply it from all those who took up residency in social housing before 1 April 2013 as such a policy is retrospective and unfair isn’t it Amber Rudd?

The Tories can’t afford to roll out Universal Credit!

Why won’t Amber Rudd the DWP Minister extend Universal Credit to 3 million new claimants?  The answer is she can’t afford to do so as it would cost the Government an additional £1.58 billion per year!!

The original Government estimate was it would cost then £173 per year to administer each Universal Credit claim yet the actual cost of administering each UC claim is £699 and £526 per claim MORE than they envisaged.  The plan to extend Universal Credit to three million more claimants would cost 3 million times this £526 per year extra cost, which is the £1.58 billion figure.

The number who will eventually claim UC is 8.5 million and each will cost Government the same £526 more per year in administration costs and which amounts to £4.47 billion more per year and £22.4 billion more over a 5-year parliament.  That £22.4 billion over 5 years extra cost of UC is hugely significant as it is AN ADDED COST to Government that needs to find the money from somewhere to pay for their flagship welfare benefit reform and to put this massive added cost into its correct context look at a report in the Guardian a few months back which detailed the £37 billion of cuts between 2010 and 2021:

Some of the most striking cuts are in disability benefits – personal independence payments (PIP) and employment and support allowance (ESA) – which together will have shrunk by nearly £5bn, or by 10%, since the start of the decade.

A new measurement of UK poverty published last week by the Social Metrics Commission highlighted that more than half of families living below the breadline contained at least one person with a disability.

Other cuts include: tax credits (£4.6bn), universal credit (£3.6bn), child benefit (£3.4bn), disability benefits (£2.8bn), ESA and incapacity benefit (£2bn) and housing benefit (£2.3bn). By contrast, spending on the state pension will be £1.7bn higher by 2021.

With around 7.5 million still to move to Universal Credit the Government needs to find 7.5 million lots of £526 per year just to administer UC – a sum of £3.95 billion each year and almost £20 billion over a 5-year parliament.  The Government as part of its welfare cap policy has to say where it is going to get the money from for any new welfare policy and (I presume) this must cover the wider roll outs to its Universal Credit policy.

Even if the Government can offset some of this by the reduced amounts that Universal Credit pays out this is still nowehere near enough to cover the £4.47 billion per year added administration cost of UC.  The cuts that Universal Credit will make are outlined but shamefully not detailed in a BBC website article of today …

2.2 million families are expected to gain under the system, with an average increase in income of £41 a week according to analysis by the Resolution Foundation think tank. However the same analysis found that 3.2 million households could loose an average of £48 per week.

3.2 million losing £48 per week is a cut of £153.6 million per week and 2.2 million gaining £41 is an increase of £90.2 million per week for an overall weekly cut of £63.4 million which is a yearly cut of £3.31 billion.

Thus a full roll out of Universal Credit cuts £3.31 billion yet costs £4.47 billion extra to administer meaning UC actually costs Government £1.16 billion per year to run – and as the National Audit Office has stated it gets 20% of its decisions wrong (see here) and £1.16 billion per year is £5.8 billion more per parliament.

So in summation Universal Credit will cost an additional £5.8 billion every 5 years in which time it will have got 100 million UC decisions wrong!  I remind that this is the Government flagship welfare benefit reform that costs so much more and doesn’t work!





UC – 20 million wrong decisions per year

20% of Universal Credit decisions are incorrect and underpayments and if ever fully implemented UC will make 20 million incorrect underpayments every year.

uc off1

The National Audit Office (NAO) scrutinises public spending for Parliament. The NAO helps Parliament hold government to account its website says and is the source of the 20 million incorrect underpayments each year which was contained in an open letter from its head, Sir Amyas Morse, to the DWP on 4 July 2018.

The letter – a full copy is appended – stated that 20% of UC decisions are incorrect and underpayments.  The 20 million incorrect decision figure comes from the fact that UC will have 8.5 million claimants each having 12 UC decisions each year for a total of 102 million decisions giving 20.4 million wrong decisions each and every year.

The only recipients of Universal Credit are those not in work and those in work on low wages and these will form the 17 million UK citizens who have less than £100 in savings which is another NAO figure.  UC recipients are people who exist or more correctly subsist from one pay date to the next and they will be the victims of these 20.4 million wrong and underpaid decisions each and every year.

Universal Credit is systemic UK poverty caused by government incompetence.

More than 5 years into operation and with dozens of ad hoc changes from its ‘test and learn’ approach – itself a government admission the policy is ill-conceived and unfit for purpose – and to date only applying to the least complex cases still sees a 20% failure rate shows how inept and unfit for purpose ideological whimsy of a policy it is.

Once UC begins to take the more complex cases there is a logically strong argument its current 20% decision failure rate will increase yet the policy is still largely seen as needing to be stopped and fixed and not abandoned which it not only should be but MUST be scrapped.

If systemically creating poverty and eviction and homelessness is not enough to persuade you that Universal Credit needs to go then how about asking the current government where they will get the extra £4.5 billion per year from to administer this dog with fleas policy?

Universal Credit in its development budgeted for the government cost of administering each claim to by £173 per year.  However, the actual administration cost is £699 per case per year and more than four times more than anticipated.  Rudimentary arithmetic reveals each one of the 8.5 million eventual UC claims will cost £526 more [£699 less £173] which is a yearly added cost to government administration of £4,471,000,000 – £4.471 billion more and where is this money coming from?

Universal Credit to cost £4.47 billion pa more and £22.36 billion more each parliament just in government administration cost!

And you thought George Osbornes £25 billion cuts to welfare was bad!

Instead of politicians and campaigners citing human interest stories about how the ineptitude of UC decisions affects individual cases, and the tendency to focus almost exclusively on the time delays and other factors of the initial UC claim process, it is way past time to focus on the bigger picture which reveals the Universal Credit policy to be one of incompetence, to being ill-conceived and to be a direct cause of systemic poverty – in short far and away the worst ever social policy ever contemplated.

Universal Credit must be abandoned – It must UC Off.


The full text of the Amyas Morse letter to the DWP of 4 July 2018 is below:

amyas morse letter t dwp















20 million wrong Universal Credit decisions each year … time to UC off

Universal Credit will be claimed by 8.5 million UK households and each will have at least 12 decisions each year.  Of these 102 million individual UC decisions each year 20% of them will be wrong and result in short payment says the National Audit Office.

Over 20 million wrong and underpayments each year yet we still have idiots calling for a stop and fix rather than stop and abandonment policy!  We still have idiots saying UC is fine in theory it is only the implementaion that is wrong! Wake up and smell the coffee.

What is wrong with Universal Credit is that it is THE most incompetent social welfare policy ever created.  It is incompetent by design.

rudd and ids

Frankenstein IDS and his latest monster Rudd

After more than 5 years since it began to be rolled out nationally in October 2013 so many basic errors and faults and flaws have still not been corrected and we see the NAO state that 1 in every 5 decisions is wrong.  You cannot even roll the UC turd in glitter any more and the policy has to be abandoned.

Even the latest concerted challenge to stop UC rolling out before Christmas 2018 on the basis it will cause hardship at Christmas is idiotic.  Its basis is leave it till January 2019 and presumably on the basis that the abject poverty it creates on implementation is somehow fine if it occurs in January and February but not in December!!

Sir Amyas Charles Edward Morse, KCB is the Comptroller and Auditor General of the National Audit Office (NAO), an independent Parliamentary body and who wrote to the Secretary of State Work & Pensions (ie DWP) in July 2018 (see here) informing the then SSWP Esther McVey that 20% of Unversal Credit decisions are wrong

We also know that 20% of claimants are not paid in full on time and that the department cannot measure the exact number of additional people in employment as a result of universal credit.

  • 20.4 million wrong UC decisions each year
  • 1.7 million wrong UC decisions each and every month
  • 1.7 million UK households being underpaid each and every month
  • Over 4 million men, women and children directly placed into poverty  (1.7m households containing 2.4 people) each and every month due to this incompetent farrago of a policy

Over 5 years of “Stop and Fix” aka “Test and Learn” activities to fix this policy of its most basic of errors and it is still not fit to even be called a turd.

If 1 in 5 UC decisions are wrong NOW with just 10% of the intended full UC cohort claiming this incometent mess of a policy and after more than 5 years of piecemeal changes in the test and learn strategy then imagine what  it will be like when UC expands to ten times its current claimant number!  So far the UC 10% are the easiest and least complex cases of (mostly) single persons.  The Government test and NOT learn policy cannot even roll the policy in glitter on the easiest and least complex cases!

Universal Credit is a failure by design.  The Government UC test and learn policy is also a failure.