The New Statesman’s rolling politics blog

RSS

Universal Credit business case still not approved by the Treasury

Ministers' claims contradicted as civil service head says "we shouldn't beat about the bush: it hasn't been signed off".

Ministers' claims contradicted as civil service head says "we shouldn't beat about the bush: it hasn't been signed off".
Iain Duncan Smith arrives in Downing Street to attend a weekly cabinet meeting on April 8, 2014. Photograph: Getty Images.

If ministers' public statements are to be believed, all is well with Universal Credit. But another indication that that's far from the case has emerged today. Asked during an appearance before the public accounts committee whether the business case for Iain Duncan Smith's masterplan had been approved by the Treasury, Bob Kerslake, the head of the civil service, replied:

We shouldn't beat about the bush: it hasn't been signed off.

That contradicts the answer given by employment minister Esther McVey, who told Rachel Reeves last week: "The Chief Secretary to the Treasury has approved the UC Strategic Outline Business Case plans for the remainder of this Parliament (2014-15) as per the ministerial announcement (5 December 2013, Official Report, column 65WS)."

The failure of the Treasury to sign off Universal Credit is further evidence of George Osborne's doubts over the financial viability of the project. To date, the DWP has written off £40.1m of assets developed for the programme and expects to write down a further £91m by March 2018, prompting the National Audit Office to warn that it has has "not achieved value for money". 

This waste has come in spite of, not because of, the number of people using the new system. According to the DWP, there were just 5,610 claiming the benefit at the end of March, 994,390 short of the government's original target of one million. So great are the obstacles now faced by the programme that many in Whitehall believe it will be put out of its misery after May 2015. While both the Tories and Labour remain committed to Universal Credit in principle, the Treasury's forestalling is the strongest evidence yet that it may not survive under either. 

Update: Here's the DWP's response: "Universal Credit is on track to roll out safely and securely against the plan set out last year - the new service now available in 24 Jobcentres, and last week expanded to claims from couples.

"The Treasury has been fully engaged in the roll out plan and have approved all funding to date."