If you are a coalition minister in the DWP or Treasury you are in a bad place when even the rightwing Institute of Economic Affairs describes your performance on child benefit changes as ‘probably the single most incompetent change to the benefits system since the second world war.’  But the chaos revealed in the run-up to 7 January comes as little surprise to those local authorities implementing the (now delayed) benefit cap and other welfare changes this year.

Despite welfare reform being a major aim of this government, as we approach the halfway point the programme is beset up delayed regulations, lack of detail at an early stage, sudden changes of plan and shifting costs from central government to local government. Wore still, in many cases the plans haven’t achieved what they ostensibly set out to do – reduce costs or actually reform areas which need to be fundamentally changed – for example, how to support people with low or modest incomes with rents.

From the perspective of an inner London council working with local advice agencies – the government’s welfare chaos is clear. Here are just a few examples:

–          The benefit cap was originally due to come in on 1 April, but was delayed just before Christmas in the vast majority of authorities ‘until the summer’ – the government cited IT problems delaying the changes, despite assuring councils that it was ‘full steam ahead’ in November.
–          Departmental impact assessments – undertaken by law to help mitigate perverse or unintended consequences – are lightweight, leaving real concerns about disproportionate pressure on women and large families.
–          Little work has been done to ensure that digitally excluded people – often the most vulnerable – will be able to use the new universal credit system.
–          There have been contradictory signals – eg the relationship between work incentives with council tax benefit changes and universal credit.
–          The benefit cap has taken no account of obvious factors such as London’s rampant private rents. The more people who are caught short by having to pay higher rents, the more pressure there will be on councils’ temporary accommodation budgets, costing more taxpayer money not less.
–          London boroughs planning to cover the costs in temporary accommodation to the tune of £2m or more each this year: effectively transferring financial pressure from the DWP to local authorities. The figures across London, taken together, will be staggeringly high at a time when council tax is capped, meaning further pressure on frontline services.
–          Following the introduction of the Housing benefit cap, private rents were supposed to respond by falling. In fact, London rents have increased. Abolition of housing benefit for under-35s unless they share actually suits landlords as they are able to maintain prices for 3-4 bedroom homes because of increased competition from young people and families for the same type of home.
–         Housing benefit has been limited but, crucially, not reformed. Even after the government changes, more taxpayer money will be used to support private landlords than we will spend building new homes or developing cheaper rented accommodation. Instead of investigating the out-of-control housing market and looking at how rents could be moderated, like in other industrialised cities, the government has chosen to continue an inadequate and unfair system, while penalising families on very modest incomes for an out of control housing market.
–          Forcing councils to administer council tax benefit with millions less in support has been beset by delays and changes in government regulations, forcing many councils to reconsult on original plans and waste more public money doing so. Because councils can’t afford to pick up the bill for the support for poor households put in place to distinguish council tax from the previous poll tax, councils will spend resource chasing the poorest 10 per cent of households for small amounts of money.
–          The ‘localisation’ aspect of council tax benefit, which it was initially sold to the public on, was effectively ditched after major IT firms refused to participate due to the complexity and reputational risk of the new system and the lateness of government regulations.
–         The government has made no attempt to communicate impacts on primary and secondary schools, which will see rolls falling and more children in poverty.

I could go on – but my point is that the desire of Conservative and Liberal Democrat ministers to ‘reform’ welfare has not been matched with an effort to develop a coherent or serious plan to implement change in a sophisticated way. The coalition’s version of ‘welfare reform’ is progressed without reference to the social contract developed when the welfare state was created: the contributory principle.  Instead they have allowed a disgraceful smear campaign – bordering on ‘chav-bashing’ – against welfare recipients themselves: including, as the Resolution Foundation has found, many low-income working families and against their children.

DWP and Treasury ministers should hang their heads in shame. While change is inevitable and there will be winners and losers the development of consent has been subject to the politics of alienation and old dogmas.

Policies of this scale affecting people who had nothing to do with the banking crisis in the first place deserves more coherence and fairness than today’s chaos and incompetence.

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Theo Blackwell is cabinet member for finance at Camden council. Full details of welfare impacts in the borough are published online here

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Photo: Foreign and Commonwealth Office