Let’s face it, it’s a difficult job. Doing a major and radical redesign to the country’s benefits programme is not as simple as passing a few new piece of legislation and flipping a switch. Also, due to the nature of our Coalition government, there is no one united point of view about what exactly should be changed, what the new thresholds should be and a wide variety of other details which have both their own supporters and detractors.
Given the bureaucracy which exists in the UK, it was possibly obvious to many that the universal credit initiative would not start as quickly as many politicians had either hoped or promised. Perhaps not unlike some of your dinner guests, universal credit is going to be late.
So Close, and yet so Far
It seems amazing that it was only a year ago, when the Secretary of State, Duncan Smith, was confidently announcing that universal credit would be enacted no later than April 2014. Now, with that deadline fast approaching, it appears that has been pushed back, not by months, but by years.
Now, the new target year is 2017. Yes, this is after the next general elections. Does it imply that some of the members of the current government don’t want to get into this very complex and polarised discussion, basically punting the ball out past the next elections? It’s difficult to say. But there is more than just politics involved here. A radical redesign of a scheme such as this requires a tremendous amount of information technology expertise and work.
Reprogramming all of the applicable government computers to fit whatever the new mandates will be is complex. Just ask US President Barack Obama. He recently deployed his new universal health care coverage initiative and so far, in the first month or so, it has been a massive failure, technologically speaking.
Will working families be worse off?
During Prime Minister George Osborne’s recent Autumn Statement, there were a few sentences which may have escaped many, but which could potentially prove to have serious consequences, in terms of the benefits that the universal credit would provide. It appears that the Office for Budget Responsibility has confirmed these proposed changes.
For one, the OBR has estimated that inflation over the next three years would be just slightly less than 9%. However, universal credit allowances are not tied to inflation. As a result, a few years from now, recipients could be receiving less money in real terms (true spending power) than they are now. One think tank, the Resolution Foundation has analysed the implications and it has concluded that by 2017, the reduction in benefits could range from £244 single-family household to £60 for a married couple with no children.
Creating Your Own Wealth
Hopefully, the proposed changes and timings for the universal credit system won’t affect you personally. But it might very well serve as a wake-up call that you should do more to secure your own financial future. The best thing you can do is to start saving money, in a disciplined way, every month. Understandably, you might need some flexibility and access to your savings in the event of an emergency. Easy access accounts provide the simplest and most effective way to earn a great rate of return, while giving you all the flexibility you need. This way, you can start building a solid economic foundation.
Image courtesy of: freedigitalphotos.net Stuart Miles
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