Great Britain: the moderate effects of the minimum income social security reform

Universal Creditart

Established in 2012, the British reform of the minimum income social security produced a moderate impact on the return to work, according to a DARES study[1]. Implemented by the Cameron government, the “Universal Credit” merged the main social benefits into a single service. The introduction of this system, which includes the Jobseeker’s Allowance and the Child Tax Credit, was a financial incentive to return to work and increase the number of hours worked.

The other objective put forward by the promoters of this program was to combat the non-use of social security benefits by certain segments of the population. The study conducted by the research centre of the Ministry of Labour seems to indicate that the Universal Credit is far from having fulfilled all its initial promises.


Presented at its launch as a true revolution in the British welfare state model, the Universal Credit is one of the key reforms of the first Cameron government. The British administration estimated than that 300,000 people could return to work as a result of the introduction of this device.


Limited to job seekers, the payment of the single allowance does not necessarily imply a quicker return to employment. According to DARES, the Universal Credit beneficiaries have only an additional 8% chance of finding a job within the 270 days following their application compared to jobseekers receiving the “classic” unemployment allowance. Rather than favouring a return to stable employment, the beneficiaries of this program are more likely to rely on short-term contracts.


The other strand of reform was to promote greater administrative simplicity. However, jobseekers still face many difficulties to become beneficiaries of the program in case their situation presents a certain complexity.


DARES concluded that “merging or removing existing schemes does not necessarily mean savings, at least in the short term”. The costs of managing the new aid and its information system would have been greatly underestimated by its initiators.


Although DARES indicates that it is impossible to draw definitive conclusions about a program that has been implemented gradually only recently, the Universal Credit case illustrates the complexity of implementing an efficient and fair social protection reform in Britain, as in the rest of Europe.




[1] The Direction de l’Animation de la Recherche, des Etudes et des Statistiques (DARES) is a branch of the French central government, under the Ministry of Labour, Employment, Vocational Training and Social Dialogue.