Universal Credit security fears put DWP job cuts off till next parliament

Devastating public sector job cuts will be put off until half-way through the next parliament after the Department of Work and Pensions obstructed the government’s “digital” reform of its Universal Credit benefits system.

The DWP had put an epoch-making jobs cull on the cards when tore up its plans for Universal Credit last autumn and signed it up to the coalition Digital Strategy – a Cabinet Office plan to cut up to 80 per cent of jobs by making government services “digital”, meaning to automate them and administer them through mobile apps and web browsers.

The plan would have done away with benefits processing staff, and begun a cull of staff at jobs centres as the state-run job-matching service was replaced with web apps – fulfilling a Conservative election pledge to replace “bureaucratic” public services with private sector competition.

But the department’s 90,000 staff were given a stay of execution last week when it said it was not ready to go through with the digital transformation after all. Of those staff – who constitute the largest body of staff in the UK public sector

The DWP was sticking to Plan A, it said in a statement, which was to build Universal Credit on top of its existing “legacy” software systems and to bolt web apps on at a later date.

Iain Duncan Smith, work and pensions secretary, told the BBC Radio 4 Today programme that the “digital” aspects of Universal Credit had been delayed over fears that the security system was not ready.

“The reason why I put the red team report in a year-and-a-half ago [was] because I was concerned that the relationship between the security and the online aspects wasn’t going to work,” said the minister this morning.

“Outside [advisers] agreed with me. What we actually did was, we reset the programme so we do the volumes later in the rollout.

“I think that’s fair because the lesson we learned from the rollout of the last government, for example, of tax credits, where they put huge volumes through very early on and the whole system crashed, costing £13bn in fraud. that’s a lesson I was very certain we needed to learn and not repeat,” Duncan Smith said.

Asked to clarify the minister’s statement, a DWP spokesman said his transcript of the radio interview was missing the part where Duncan Smith referred to security and benefits fraud. The minister would not normally refer to security in this context, he said. He had no idea what security concerns had delayed Universal Credit.

The DWP had nevertheless agreed to make Universal Credit a test bed for the Cabinet Office Identity Assurance Scheme (IDA) – an online, market-led alternative to the last Labour government’s Identity Card Scheme on which the Conservative plan to automatize government would hinge.

The National Audit Office said in September that the Cabinet Office’s “digital-by-default” plan to have all benefits transactions processed online had with IDA been two of three things that went wrong for Universal Credit.

DWP had long experience taking precautions against the fear that a fully-digital benefits processing system would be a bonanza for fraudsters.

Those fears have now led to delays in the roll-out of the Universal Credit system because, the work and pensions secretary effectively told Today, the Cabinet Office IDA scheme is not ready. Whatever the whys and the wherefores, the delay will ensure the next government will be forced to face the prospect of computers replacing jobs at the largest single employer in the UK public sector.