Duncan Smith's master plan is under ever-greater attack

Universal Credit will leave claimants "trapped in poverty", warns the Joseph Rowntree Foundation.

The objections to Iain Duncan Smith's master plan to transform welfare - the Universal Credit (UC) - are rapidly mounting up. Earlier this month, a commission led by Paralympian Tanni Grey-Thompson warned that 450,000 disabled people would receive less under the scheme, despite Duncan Smith's promise that there would be "no losers". Now, a new report from the Joseph Rowntree Foundation (JRF) suggests that it could leave claimants "trapped in poverty" by failing to fulfil the coalition's pledge to "make work pay". The foundation warns that while the scheme will incentivise people to take mini-jobs of fewer than 16 hours week, it will not "encourage" recipients to go on to search for full-time work. "Marginal increases in earnings alone are unlikely to be sufficient incentive to move into full-time work, with small financial gains likely to be wiped out by costs such as childcare and travel," the report says.

The JRF, which has long supported the scheme in principle, also warns that UC, ostensibly a simplification of the welfare system, will leave claimants facing "a more complex benefits system than before". The shift from fortnightly to monthly payments could result in low-income families running out of money before the end of each month.  The report suggets that "Recipients may have to borrow money to bridge the gap, leaving them to start their universal credit claim in debt … it may create an unfair bias against women, with child-related support not necessarily reaching the children it is intended for."

And then, of course, there's the question of whether the computer system on which UC is based will actually work. In theory, benefit payments will be automatically adjusted as earnings vary, ensuring that claimants are always better off in employment than out of work. But that relies on real-time data transfers between HM Revenue and Customs and the Department for Work and Pensions, something many fear will prove impossible. As Rafael noted earlier this month, "The question being asked with increasing urgency (but still mostly in private) by pretty much everyone involved in welfare policy is this: if the DWP can’t seem to administer the existing benefits system properly, how on earth are they going to manage the switch to UC?" The JRF urges the government to provide details about stand-by arrangements if systems crash and to consider creating an ombudsman to deal with complaints.

With the UC "pathfinders" due to launch next April and the national launch set for October of the same year, time is short for Duncan Smith to convince the sceptics. In the words of public accounts committee chair Margaret Hodge, an ever-greater number of people believe that the project is "a train crash waiting to happen; there is too much going on".

Work and Pensions Secretary Iain Duncan Smith speaks at last month's Conservative conference in Birmingham. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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Why isn't Labour putting forward Corbynite candidates?

Despite his successes as a candidate, the organisational victories have gone the way of Corbyn's opponents. 

The contest changes, but the result remains the same: Jeremy Corbyn’s preferred candidate defeated in a parliamentary selection. Afzhal Khan is Labour’s candidate in the Manchester Gorton by-election and the overwhelming favourite to be the seat’s next MP.

Although Khan, an MEP, was one of  the minority of Labour’s European MPs to dissent from a letter from the European parliamentary Labour party calling for Jeremy Corbyn to go in the summer of 2016, he backed Andy Burnham and Tom Watson in 2015, and it is widely believed, fairly or unfairly, that Khan had, as one local activist put it, “the brains to know which way the wind was blowing” rather than being a pukka Corbynite.

For the leader’s office, it was a double defeat;  their preferred candidate, Sam Wheeler, was kept off the longlist, when the party’s Corbynsceptics allied with the party’s BAME leadership to draw up an all ethnic minority shortlist, and Yasmine Dar, their back-up option, was narrowly defeated by Khan among members in Manchester Gorton.

But even when the leadership has got its preferred candidate to the contest, they have been defeated. That even happened in Copeland, where the shortlist was drawn up by Corbynites and designed to advantage Rachel Holliday, the leader’s office preferred candidate.

Why does the Labour left keep losing? Supporters combination of bad luck and bad decisions for the defeat.

In Oldham West, where Michael Meacher, a committed supporter of Jeremy Corbyn’s, was succeeded by Jim McMahon, who voted for Liz Kendall, McMahon was seen to be so far ahead that they had no credible chance of stopping him. Rosena Allin-Khan was a near-perfect candidate to hold the seat of Tooting: a doctor at the local hospital, the seat’s largest employer, with links to both the Polish and Pakistani communities that make up the seat’s biggest minority blocs.  Gillian Troughton, who won the Copeland selection, is a respected local councillor.

But the leadership has also made bad decisions, some claim.  The failure to get a candidate in Manchester Gorton was particularly egregious, as one trade unionist puts it: “We all knew that Gerald was not going to make it [until 2020], they had a local boy with good connections to the trade unions, that contest should have been theirs for the taking”. Instead, they lost control of the selection panel because Jeremy Corbyn missed an NEC meeting – the NEC is hung at present as the Corbynsceptics sacrificed their majority of one to retain the chair – and with it their best chance of taking the seat.

Others close to the leadership point out that for the first year of Corbyn’s leadership, the leader’s office was more preoccupied with the struggle for survival than it was with getting more of its people in. Decisions in by-elections were taken on the hop and often in a way that led to problems later down the line. It made sense to keep Mo Azam, from the party’s left, off the shortlist in Oldham West when Labour MPs were worried for their own seats and about the Ukip effect if Labour selected a minority candidate. But that enraged the party’s minority politicians and led directly to the all-ethnic-minority shortlist in Manchester Gorton.

They also point out that the party's councillor base, from where many candidates are drawn, is still largely Corbynsceptic, though they hope that this will change in the next round of local government selections. (Councillors must go through a reselection process at every election.)

But the biggest shift has very little to do with the Labour leadership. The big victories for the Labour left in internal battles under Ed Miliband were the result of Unite and the GMB working together. Now they are, for various reasons, at odds and the GMB has proven significantly better at working shortlists and campaigning for its members to become MPs.  That helps Corbynsceptics. “The reason why so many of the unions supported Jeremy the first time,” one senior Corbynite argues, “Is they wanted to move the Labour party a little bit to the left. They didn’t want a socialist transformation of the Labour party. And actually if you look at the people getting selected they are not Corbynites, but they are not Blairites either, and that’s what the unions wanted.”

Regardless of why, it means that, two years into Corbyn’s leadership, the Labour left finds itself smaller in parliament than it was at the beginning.  

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to British politics.