Memorandum submitted by PCS
1. The Public and Commercial Services Union
(PCS) is the largest trade union in both the civil service and
the Department for Work and Pensions (DWP). PCS represents over
330,000 people including 80,000 in the DWP.
2. PCS welcomes the Select Committee's inquiry
and is happy to supplement this submission with further information
and oral evidence.
3. PCS welcomes any new policy that will
improve the service that our members are able to provide for benefit
claimants. Simplifying the benefit system should be one such policy.
However, we are concerned that the motive behind this initiative
may be finding financial savings in both benefit expenditure and
administration, rather than improving the benefit system for citizens.
4. We believe that any debate around simplifying
the benefit system should start with the elimination of poverty,
especially child poverty, as its primary consideration. The value
of benefits has been allowed to decline year on year as a result
of the policy of annual increases being linked to prices rather
than wages. The result is that benefits levels are now scandalously
low and effectively condemn millions of citizens into a life of
poverty. Any proposals to simplify the benefits system must recognise
this point and be designed to address it.
5. PCS is also concerned that the ongoing
cuts in DWP staffing levels and the DWP estate, and the importance
that DWP and ministers attach to meeting headcount reduction targets
at the expense of service delivery, will distort and damage any
serious simplification plans. Proper staffing levels and resources,
including investment in appropriate staff training, are an essential
element of the process.
6. Since the Welfare State was created there
have been regular reviews, changes and initiatives that have impacted
on the benefit system. These changes have tended to be tacked
onto the existing basic system, particularly since the computerisation
of the various business units. Under-achieving computer systems
have led to a significant variation in how people are paid benefits.
Staff and managers are compelled to devise "workarounds"
to enable customers to be paid correctly and on time. The lessons
of recent failed computer systems in DWP must be learnt. Control
of the development and delivery of the IT required for benefit
simplification must be retained inside DWP. Any reliance on the
major IT companies whose promises to deliver state of the art
systems have too often turned out to be empty, must be kept to
7. The cancellation of the Benefit Replacement
Project has forced DWP to adapt existing computer systems to cope
with new changes to the benefit system (eg Employment Support
Allowance). One of these existing IT systems is the Customer Management
System (CMS) that has been discussed at previous Select Committee
inquiries. Given the discredited reputation of the CMS system
it is essential that lessons are learnt from its introduction
as part of any benefit system simplification. This can only be
done by the IT needs of the business being looked at holistically
with the necessary planning and financial investment being in
8. In terms of changes to the benefit system
the most fundamental change came in 1988 with the introduction
of Income Support and the Social Fund. Income Support did simplify
the old Supplementary Benefit system but only by abolishing a
range of additional entitlements that effectively cut the overall
value of the benefit. This version of benefit simplification,
based on achieving benefit savings and thereby increasing poverty,
should not be used as the model for future reform.
9. The introduction of Social Fund on the
other hand both complicated the system and contributed to increased
poverty by replacing grants with loans for essential items like
beds and cookers. Social Fund is expensive to administer and,
due to the budget caps placed on Social Fund budgets, delivers
different outcomes in different locations. Above all it forces
the poorest in society to get into debt just so they can have
access to the basic requirements of modern life. Any simplification
of the benefit system should include a return to a grant-based
system for essential items for Income Support (or its equivalent)
10. All of DWP businesses now rely to a
considerable degree on contact centres as a primary communication
tool with claimants. Yet staff working in contact centres are
discouraged from developing a wide knowledge of the benefit system
as this can lead to calls being longer than targets permit. Consequently
staff are frequently unable to answer benefit queries. Investment
is desperately needed to make DWP's contact centre network work
effectively. Investment in staffing levels is needed to end the
oppressive working culture where IT systems dictate when staff
can leave their desk or take a day off. Investment in staff training
is also required to ensure claimants can get the full information
they need from a single phone call.
11. The new contact centre organisation
undermines improved customer service by the over-emphasis placed
on measuring performance by monitoring the processes (eg length
of calls with claimants) rather than the outcome that the claimant
receives. Staff need to be given back the discretion to decide
how much time they should spend on each individual call. Each
call is different as each claimant is different. People understand
this but IT systems do not. An essential requirement of any simplification
must be that claimants can understand their entitlements as they
relate to their particular circumstances. This will require well-trained
staff with the time and resources to deliver this essential service.
Real investment in staff dealing direct with customers by the
method of communication most suited to the claimant will not just
deliver the right benefit at the right time to the customer. It
can also lead to decreases in complaints and appeals that at present
divert precious staff resources from ensuring they pay the benefit
correctly and on time at the initial claim stage.
12. The new Jobcentre Plus structure is
actually creating barriers to effective communication with claimants.
The contact centres that take the initial call are now physically
and organisationally separated from both the benefit delivery
centre where the claim is later processed and the Jobcentre where
the unemployed go to sign on. This reorganisation was done in
the name of efficiency, yet little thought was given to the customer
who has to interact with three separate parts of the organisation
where previously their claim was dealt with at one location, where
they could call in and talk to someone about their claim if they
wanted to. Callers to Jobcentres are now actively discouraged
by Jobcentre Plus and claimants who call into a Jobcentre hoping
to discuss their claim are turned away. In addition the network
of visiting officers that DWP used to have to check on and explain
benefit entitlement has been almost completely eradicated.
13. The consequences of these changes has
been to make customer service worse not better. A major overhaul
of the benefit system would be difficult to achieve effectively
within the new Jobcentre Plus structure where proactive customer
service provision to champion benefit take-up barely exists.
14. Working people pay heavily into the
National Insurance scheme. As a consequence they have a legitimate
expectation of financial security when unable to work. The rates
of benefit therefore need to be increased in line with wages not
prices to provide this and to prevent the slide into poverty that
unemployment or incapacity too often means.
15. Universal benefits are popular and simple
to both claim and administer. Child Benefit has a near 100% take-up
rate, and is an effective tool against child poverty.
16. Means-tested benefits on the other hand
are necessarily complicated to both claim and administer as they
have to be adjusted for, often quite minor, changes of circumstances
on a regular basis. This is best shown by the tax credit system.
It is widely acknowledged that the complexity of the tax credit
system puts off many people who are entitled to tax credits from
17. Above all there has to be a recognition
that for many reasons there will always be people who are not
able to work at any one time. It is not enough to say that they
should find work as the route out of poverty. The Government must
also ensure that those reliant on benefits must be assured of
an income that lifts them out of poverty.
DWP SIMPLIFICATION PLAN
18. The DWP Simplification Plan emphasises
the benefits for customers and for the Department of simplification.
However it does so by placing undue emphasis on efficiency savings,
less regulatory processes and staffing reductions. Instead the
emphasis behind simplification should be how it can be used to
eliminate poverty through well-resourced public services organised
with the customer's needs at the forefront.
19. Our members working in DWP have been
particularly hard hit by the Government's efficiency programme
and subsequent job cuts. This has resulted in many of our members
moving from work onto welfare through redundancies and greater
use of temporary workers. Those remaining face increased workloads,
greater pressure to meet targets, increased stress and collapsing
20. The privatisation of DWP's support services
like file storage and leaflet provision has led to staff being
transferred into the private sector only to be made compulsorily
redundant by their new employer within weeks. This enables DWP
to claim it is achieving the staff reductions without compulsory
redundancies, but instead it is using privatisation to force redundancies
via the back door
21. The consequences of this drive to reduce
staff, estate and costs in DWP are affecting DWP customers too.
The closure of rural Jobcentres may make for a simpler and cheaper
system but it ignores the extra cost for the customer forced to
travel further to sign on and meet their advisers. As described
above the contact centre system may be cheaper to run but is not
designed with the customer's interests in mind.
22. In the Pension Service the efficiency
savings are pushing the system close to collapse and depriving
many of the most vulnerable members of society from their correct
entitlement. At present in the main pension centres responsible
for processing pension claims there are between 10,000 and 30,000
pieces of post awaiting action. At one Pension centre there are
10,000 new state pension and pension credit claims awaiting payment.
This system desperately needs increased resources. Instead DWP
this week have announced the closure of the Pension centre in
Bath with the loss of nearly 400 jobs.
23. The Freud report takes the potential
damage to the DWP a stage further. The report calls for the privatisation
of all of Jobcentre Plus' employment services for those who have
been on benefit over one year. PCS believes this to be unjustified
based on the past achievements of Jobcentre Plus in reducing unemployment,
including the long term unemployed. We can see no benefit in complicating
the system by creating a new network of private and voluntary
service providers for the unemployed. Multiple providers of DWP
services will confuse claimants and muddy the accountability between
DWP and the provider for key decisions such as benefit conditionality.
It is a huge gamble to rely on inexperienced, untried and untested
service providers as Freud recommends. It is a huge mistake to
do this when there is already within Jobcentre Plus a large cadre
of trained and experienced advisers with a track record of delivering
huge reductions to unemployment through policies such as the New
5 April 2007