How UBI can learn from the failures of Universal Credit

In the space of a few harrowing days, the infrastructure of the British welfare state was flipped on its head. The Chancellor Rishi Sunak, who only took the role in February, was suddenly in charge of the largest expansion of spending in peacetime. Taking up as the steward for employee wages, business bailouts and loan shark may have been the economic wake-up call the welfare system needed, though in exceptional circumstances and certainly not the right pathway.

The immediate place for those who have been made unemployed by coronavirus is the Tories’ flagship project Universal Credit. The Department for Work and Pensions reported their ‘applications in’ tray was flooded with half a million reaching for help over nine days. Once it reached the new month of April, this number doubled. A sad truth awaits those desperate for subsistence relief: Universal Credit is, and always has been, a failure.

I’ve been receiving Universal Credit for two and a half years. My circumstances were like many other welfare claimants: health problems, unemployment and debt. It took a lifeline bank loan to help me stave off full penury, not government assistance. The application process, as many have repeated time and time again, is one of the most stressful pieces of paperwork in modern life. A punitive ID check to those on lower incomes and without access to formal identity documents, as well as a requirement for face-to-face meeting, leaves people facing a brick wall before they’ve entered the building. Students, minority groups, the disabled – a cosmic failure to those who are most in need.

The recent reduction in the wait time to five weeks is barely a gesture, especially in the current climate where every day means more uncertainty. So when the government decided on a relief package, why didn’t Universal Basic Income go further than a brainstorm?

From a pragmatic understanding UBI would have worked with our current crisis. Regardless of the arguments for full ‘peacetime’ extension, those who have been forced to leave employment are now in limbo. A regular subsistence payment altered for household requirement would have been a strong sign of empathy from government, as well as providing a desperately needed safety net. Was it because the words came from the left that the Tories refused to give it a second thought? When Tory MPs are calling for the new Opposition leader to attend Cabinet meetings, it shows that for some ideological difference means little in such scary times.

As it stands, no UBI for this catastrophe. Thousands will have to suffer the inadequacies of Universal Credit, a system which was already paused at various junctures. If even the gatekeepers of this welfare scheme have such little confidence in it, delaying its full rollout in early February, how can those facing hardship have faith in its providence? For Labour, if UBI is to become a manifesto pledge for future elections, the experience many will now be feeling through the days of pandemic will need to shape better welfare policy.

Structurally, Universal Credit makes some sense: a combination of other different welfare schemes into a single lump sum. Converting the welfare state into a UBI-led system must learn from the previous pitfalls of bureaucracy, namely those associated with addressing housing and disability benefit. UBI’s strength is through its basic premise: universality. The separation of criteria with Universal Credit would easily transfer to UBI with more of an emphasis on living rather than working – after all, it is designed to push people toward employment rather than a more tolerable life.

A UBI-led welfare system could swallow up the different benefits contained within Universal Credit, whilst also putting emphasis on giving every person a basic living payment. It should be noted that UBI is a moral position as well as economic. Giving people the means to exist comfortably, without fear of want, is essential for any egalitarian society to tackle social problems.

For example, take Universal Credit’s current allocation to housing costs. Currently a single person under the age of 35 with no dependents would not be entitled to receive a full housing payment. They would only receive a basic rate calculated from their local authority. This is punitive to young, unemployed people and those at the beck and call of landlords’ demands – anyone who’s seen ‘NO DSS’ splattered over housing websites will know how uncooperative the housing market is to younger people.

If there is to be a more constructive debate about UBI, it needs to take into consideration the experiences (or nightmares) many have had with Universal Credit. Implementing such a giant scheme would take time and mass planning, indeed, something we’re currently seeing from Westminster in rapid response to the coronavirus. UBI must be an accessible, well-explained arm of governance in conjunction with tackling wider inequalities. The move to an online service is a natural transformation, but it must still cater for those without easy access to a computer, particularly older people and the homeless. And while Eleanor Rathbone may have sparked a fuse for the principles of the modern welfare state, employing UBI in our current times will take more than warm words.

Make no mistake – UBI is a method for lifting not flattening society. Its evil stepbrother Universal Credit has done the opposite. The Keir Starmer frontbench should be viewing our current crisis as a record of years of damaging cuts, but also a potential to realise a much stronger provision of welfare. A potential which opposition MPs, particularly from the SNP, are keen to promote as a provision of support throughout the coronavirus lockdown. It’s not disrespectful to argue for future change from within this dreary lockdown. For when the dust settles, and people’s lives have been irrevocably damaged by health or wealth, a policy for constructing UBI should underpin any party manifesto.

Writer. Regularly irritating. Moans about politics, Brexit, mental health, and culture. All views mine.

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