Universal Credit: digital welfare

April 2020

Executive summary

This report aims to provide a description of Universal Credit as a digital welfare system and make recommendations for its future development.

Universal Credit is a hyper-means-tested benefit based around a monthly payment and a regime of activities that change in response to the earnings, circumstances and behaviour of claimants, and a digital account. It is highly opinionated in how it relates to family and financial circumstances, and is based around a particular view of what constitutes ‘personal responsibility’. It is at once a political project that attempts to reward or compel particular behaviours from the public and a more prosaic reform of the welfare system in the digital age.

The Universal Credit ‘digital account’, along with other digital services developed by the Department for Work and Pensions (DWP), has been critical to the delivery of Universal Credit. DWP has been able to develop these services, and respond to policy changes, in part, because of the effective digital team it created in response to the initial failure of the project in 2013. With this capability in place, the department has demonstrated it can not only deliver new digital services but make changes quickly and competently.

DWP’s competence in delivering and iterating its digital services means it is increasingly hard to ‘blame the IT’ when it comes to the impacts and effectiveness of Universal Credit. This raises questions about the trade-offs the department is making between reducing costs, the intent of the policy, and the needs of claimants.

Only by examining how the digital elements of Universal Credit manifest themselves to end-users is it possible to make practical recommendations for the future. It is also key to improving the debate around Universal Credit for policymakers and campaigners alike. However, the lack of public documentation, the personalised nature of Universal Credit, and the bi-weekly changes DWP makes to its digital services, makes this a difficult task.

Part 1 of this report documents the development of the political origins and conceptual framework of Universal Credit, how DWP develops its digital services and responds to policy changes. Part 2 summarises what is in the public domain about how Universal Credit manifests itself to claimants and details the gaps in information about how it functions. Part 3 uses this background information to identify issues with the digital aspects of Universal Credit and make recommendations in the five broad areas below.

1. How the Universal Credit policy framework functions in practice as a digital system

The complex and opinionated nature of Universal Credit has conspired with the variation of real people’s lives to push administrative, financial and cognitive burdens onto claimants. Far from encouraging responsibility, it makes decisions for claimants, sets defaults in line with a policy vision that, ten years on, fails to ‘mirror the world of work’, and puts the majority of applicants immediately into debt to the department.

Despite some changes to the policy over time, core principles such as the monthly payment cycle and how payments are split between claimants and landlords, remain unchallenged. No amount of user centred design can remedy these and it is time to seek alternative options.

The concept of ‘responsibility’ in Universal Credit should be redefined to become less about conformity with a particular worldview, and more about ensuring the desired outcomes are met with the grain of people’s lives, rather than against it.

2. An assessment of whether the advantages of digitisation are being shared fairly between DWP and claimants

DWP has shown that it is entirely possible to offer claimants alternative payment cycles and ways of splitting the payments between partners and landlords. Continuing to treat these as exceptions, rather than options that can be easily chosen by claimants, is a policy choice rather than a constraint of the technology.

In addition to issues of digital inclusion, which have been covered in detail by others, there is a key question about the digitisation of the welfare system: are the benefits of digital being shared equally with the public? Currently, the answer appears to be no.

Critical parts of the Universal Credit policy, such as appeals, have not been digitised at all, and options that empower claimants to take greater responsibility by choosing how Universal Credit works for them are obfuscated or missing.

DWP’s focus on automation prioritises its efficiencies over those of the public. There are huge opportunities to use the data that DWP holds to reduce administrative burden, speed up payments and improve how it communicates with claimants, but these have not been prioritised. It is also not sufficiently transparent to claimants when and how automated decisions have been made.

3. The case for rethinking Universal Credit as an open platform, so that civil society might better support claimants, and government might operate more effectively

Universal Credit remains a stubbornly closed system. Third parties find it hard to support claimants and must interact with the digital account on DWP’s terms. By rethinking Universal Credit as a shared platform, and by understanding the needs of civil society organisations, there is an opportunity to meet needs that DWP either cannot or will not meet.

This approach could also improve how data is used within government. Today, too many claimants fall down the gaps between government systems, particularly the systems of DWP and HM Revenue and Customs (HMRC). Taking a cross-government, platform approach to HMRC’s Real Time Information (RTI) system could reduce payment errors and increase claimant’s trust. There are also opportunities to improve how data is used by local government and how claimants prove their right to things like free prescriptions.

4. An examination of the ethical and privacy implications of a hyper-means-tested benefit

In addition to the higher administrative burden created by a hyper-means-tested welfare system, there are also implications for claimant’s privacy and trust in government. Collecting additional data to personalise, target or means-test a service comes at a cost to a user’s time and their privacy. There is a strong case to be made to review the data Universal Credit requires to personalise and means-test, and to look for opportunities to rationalise it. There should be a fair assessment of the utility in meeting a policy outcome, versus the additional administrative burden for a claimant and the impact on their privacy and trust.

5. The need for new forms of transparency for digital public services like Universal Credit

Much greater transparency is needed around how Universal Credit works, how it is changing, and how it is performing.

Transparency may seem like a peripheral concern relative to other issues created by Universal Credit, but it is not. The digitisation of public services means that the choices of service designers and software developers have become critical in how the public access services to which they have a legal right. Without adequate information, there is a risk of dilution of public understanding of how public services function. There is also a risk of information asymmetry between government and civil society, where the government has a fine-grained, real-time view of how the public are using a service, but those wishing to hold the government to account for its actions operate largely in the dark.

DWP should aim to make accountability, understandability and trust, core design principles of the Universal Credit service. It should also work to better understand the needs of organisations who might hold it to account.

By publishing more information about how Universal Credit works, opening up the development process and rethinking how it publishes data and statistics, DWP could make Universal Credit into an exemplar of transparency for a digital public service. This could provide leadership across the public sector in the UK and worldwide, but would also highlight the very real efforts DWP has made to learn from the challenges of digitising a complex policy.

The working-age welfare system is critical to British society, and its digitisation raises questions that transcend welfare reform. As the roll-out of Universal Credit gets closer to completion, there is an opportunity to use the capability the DWP have built to ensure that the welfare system works for everyone. This will require much greater opening up of the digital aspects of Universal Credit and an impartial assessment of which parts of the original policy framework have failed.

Key recommendations

Recommendations for DWP

  1. Use a combination of the Faster Payments system and automation of the calculation to shorten and eventually eliminate the seven-day calculation and payment period.
  2. To reduce the number of claimants getting into debt, a two-week payment and assessment cycle should be available as an option for all claimants during the application process.
  3. Claimants should be able to change the duration and dates of payment cycles if, for example, they move from employment that pays weekly to monthly.
  4. Claimants should be empowered to take responsibility about how payments are split between them, their partner and their landlord. Choices should be designed into the application and onboarding process and should be available for all claimants in the UK.
  5. There should be additional routes to add entries into the ‘journal’ in the digital account. For example, a claimant should be able to submit information via SMS. The messages that are sent to claimants should also be redesigned to give more context.
  6. Additional information should be added to the digital account so that claimants can understand when automated decisions have been made and when a delegate, or member of DWP staff have accessed their account.
  7. Run a discovery project to look for opportunities to use automation and data to remove the administrative burden from claimants.
  8. Work with banks, childcare providers and job search websites to provide new ways of reporting data into the digital account.
  9. Create simpler methods for claimants to prove entitlement to passported benefits.
  10. Commission research into the impact of Universal Credit on the wider public finances, (e.g. to the Ministry of Justice regarding additional demands on the tribunal system), and the cost to claimants of using digital channels.
  11. Rethink Universal Credit as a shared digital platform that DWP and civil society organisations can build services on top of. This will require the department to rethink its approach to delegation.
  12. Conduct research into the privacy implications for claimants of moving jobcentres to libraries.
  13. Stop publishing monthly and quarterly statistics and move to a model of detailed, consistent, real-time publication of data using the GOV.UK performance platform.
  14. Publish information about the categories of activities required of claimants via their to-do lists.
  15. Create and maintain public registers that describe the systems used to deliver Universal Credit.
  16. Create and maintain a public archive of design changes to the digital account.
  17. Proactively publish as much of the documentation from its design and development cycle as possible. This should include findings from user research and post-deployment impact reports.
  18. Accountability, understandability and trust should become core design principles of the Universal Credit service. To achieve this, DWP should work to understand the needs of organisations who might hold them to account.

Recommendations for government and ministers

  1. A unified digital process for appealing decisions should be created and be accessible from the digital account. It should work across DWP, HMRC and HM Courts and Tribunal Service (HMCTS) systems.
  2. HMRC’s RTI system and DWP’s Real Time Earnings (RTE) system should be reimagined as a shared, cross-government platform, independent from HMRC and DWP. It should have product management that is empowered to protect the privacy of the public and meet the needs of users across government, not just of one department.
  3. Commission research into the potential of jobcentres as a shared cross-government resource for providing face-to-face support for digital services.
  4. Review the data Universal Credit requires to personalise and means-test. They should look for opportunities to rationalise it, with the aim of reducing the overall complexity of the policy, its administrative burden and privacy impact.
  5. The concept of ‘responsibility’ in Universal Credit should be reset to become less about conformity with a particular worldview, and more about ensuring the design of the policy meets the desired outcomes with the grain of people’s lives.

Recommendations for the Government Digital Service (GDS)

  1. Work with DWP and other departments to index datasets and reports published about specific digital public services. It should be possible to find all the datasets and reports that relate to Universal Credit.
  2. Conduct user research with academic researchers and civil society organisations to understand what information about digital public services should be in the public domain.
  3. Work with DWP to publish a Universal Credit systems register and design archive on GOV.UK.
  4. Identify gaps in the GOV.UK Design System around design patterns for appealing decisions, delegating access, explaining when delegates or agents have accessed an account, and automated decisions or calculations.

Recommendations for civil society

  1. Identify opportunities to create new digital services, operated by civil society organisations, built on top of the digital account.
  2. Follow the lead of the Child Poverty Action Group (CPAG) by advocating for specific design changes to the digital account.
  3. Advocate for greater access to fine-grained, real-time data about how the digital account is being used. If DWP does not respond, start collating the data independently.
  4. Advocate for a design archive of changes to the digital account. If DWP does not respond, start creating an independent archive.


  1. The details in this report come from public documents and interviews with users of Universal Credit systems.
  2. This report uses DWP’s language of ‘claimants’ to denote those who apply for or receive Universal Credit. It is suboptimal as it underplays the rights and entitlements people have, but is used for clarity when talking about different types of user.
  3. This report does not cover issues of digital inclusion and hardship in detail, as these have been covered widely elsewhere.
  4. This report was written before the recent increase in demand for Universal Credit caused by Covid-19.

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This work was supported by the Open Society Foundations