Universal Credit

Thursday 3rd November 2011 Written Statements

[The Secretary of State for Work and Pensions (Mr Iain Duncan Smith)]

The Department for Work and Pensions has obtained approval for an advance from the contingencies fund of £46 million to allow for the continued development of IT for universal credit before Royal Assent. This is a second advance; an earlier advance of £18 million was approved for the same purpose in April.

Parliamentary approval for resource and capital of £80 million for this new service has been sought in the main estimate 2011-12 for the Department of Work and Pensions. Pending approval of the Welfare Reform Bill, urgent expenditure estimated at £46 million will be met by repayable cash advances from the Contingencies Fund.

The universal credit programme has successfully completed the second stage of IT delivery on time. This is a major achievement given the demanding timetable and relatively new “agile” way of working. The second advance will allow the programme to continue to work to its current design and development timetable and enable continuity of third-party supplier engagement. This will support an earlier move to the new simplified benefit than could be achieved without it and achieve better value for money by enabling a more rapid take-up of online claims with lower operational delivery costs.

The amount covered by the advance is part of the proposed £2 billion investment in universal credit agreed at the time of the spending review. The advance will be repaid at the earliest opportunity following Royal Assent.