16
Accepted
Department initially underestimated Universal Credit non-claim rate for Tax Credit claimants.
Conclusion
The Department told us that, before the migration started, it had no evidence to use to assess how many Tax Credit claimants would not transfer to UC. At the time, the public finances had been under challenge so it had decided to make a safe assessment of what the non-claim rate would be, as it did not want to under-forecast the costs of UC. Its public expenditure forecast assumed an overall non-claim rate of 3% for all legacy benefit types, based on what had happened with the earlier move from incapacity benefit to ESA. It did not break the rate down between different types of benefit.29 The Department also told us that the non-claim rate for households claiming Tax Credits had remained fairly consistent during testing and as it rolled out the migration process at scale.30 In November 2023, the Department revised its migration plans and now expects 26% of households claiming Tax Credits, and 4% of households claiming other legacy benefits or combinations of benefits, will not move to UC.31
Government Response Summary
The government agrees, confirming it will publish quarterly statistics on non-claim rates, expand coverage to include wider legacy benefit types, closely monitor rates, and publish results of a dedicated survey on Tax Credit non-claims by the end of the year, with plans for remedial actions if needed.
Government Response
Accepted
Government Response
Accepted
HM Government
Accepted
3.1 The government agrees with the Committee’s recommendation. Recommendation implemented 3.2 The department currently publishes statistics on claim rates to Universal Credit, by legacy benefit type, on a quarterly basis. These statistics will start to include the non-claim rates for wider legacy benefit types (over and above the initial Tax Credits cohort) as these additional cohorts begin to be migrated in sufficient numbers onto Universal Credit. 3.3 The amount of data available on non-claim rates by legacy benefit type will still be quite limited for the August 2024 publication (which will include data up to the end of June 2024), due to the migration timescales. 3.4 The non-claim rates will be monitored closely via the Move to Universal Credit Implementation Control Centre, whilst they are close to forecasts presently, should the rates be higher than expected from discovery work, further analysis and investigation will be undertaken. If the insights from this work suggest there are issues to be addressed, the Universal Credit Programme will develop remedial actions based on the insights. The department will be content to share details of these actions with the Committee, should they be required. 3.5 In addition, the department will publish the results of the dedicated survey of Tax Credit non-claims and associated learning, by the end of the year.
Source
Committee
Public Accounts Committee
Report
Twenty-Ninth Report - Progress in implementing Universal Credit
26 Apr 2024
HC 458
Addressee Bodies
HM Treasury
Timeline
Recommendation age
2.3 yrs
Report published
26 Apr 2024