Scotland loses £36m after Westminster welfare blunder

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  By Angela Haggerty

The UK Government has been strongly criticised by the Public Accounts Committee in a House of Commons report over the handling of the new Universal Credit benefit.

According to the report, costs associated with the implementation of the benefit – which streamlines six commonly-claimed benefits into a single payment – will result in at least £160m being written off, but it could be much more.  A total of £425m has been spent so far, £36m of which represents Scotland’s pro-rata share.

The news follows a National Audit Office report in September which provoked anger when it was revealed that £34m had already been written off.  The report described management of the Universal Credit programme as “extraordinarily poor” and criticised a “culture prevalent in the department” of reporting only good news.

SNP work and pensions spokesperson Dr Eilidh Whiteford MP said: “This report highlights many problems with the project including officials being unable to explain the reasoning behind their timescales or their feasibility, inept computer systems, and no real management.  What makes this all the more galling is that 82 per cent of Scottish MPs opposed this, and Scottish taxpayer’s money is being wasted in the process.”

A “shocking absence of control over suppliers” which led to a lack of basic procedures monitoring and authorising expenditure was criticised in the damning report, and the creation of a clear strategy and “realistic ambitions” was recommended.

The report stated: “Oversight has been characterised by a failure to understand properly the nature and enormity of the task, a failure to monitor and challenge progress regularly, and a failure to intervene promptly when problems arose.

“Senior managers only became aware of problems through ad hoc reviews, mostly conducted by external reviewers, as inadequate management information and reporting arrangements had not alerted them that things were amiss.

“Given its huge importance to the department, the accounting officer and his team should have been more alert to identifying and acting on early warning signs that things were going wrong with the programme.”

The Universal Credit scheme, created by Work and Pensions Secretary Iain Duncan Smith (pictured), began introduction in April 2013 and will continue rolling out until 2017. It was piloted in Greater Manchester and Chesire and the next phase of the rollout began last month.

The benefit, a combination of jobseeker’s allowance, employment support allowance, housing benefit, working tax credit, income support and child tax credit, is expected to affect around 700,000 families in Scotland and concerns have been raised that the most vulnerable will be hit.

Dr Whiteford added: “We already knew the Tory- Lib Dem government’s welfare reforms were discriminatory, but we can now see the extent of how badly managed this project is.  It doesn’t have to be this way, and it shouldn’t be this way. Scotland has already made its opposition to welfare cuts absolutely clear, and a majority of Scots believe that the Scottish Government would be best at deciding welfare policy for Scotland.”

In September, Citizens Advice Scotland warned that complications in the benefits system for those struggling under financial stress may leave them unable to cope, and said benefit reforms such as the bedroom tax were already causing “real misery and hardship” among the most vulnerable.