Rishi Sunak is under fire after an extraordinary claim that “computer says no” forced him to impose real-terms benefits cuts in his spring mini-budget.
The chancellor has been strongly criticised for increasing payments to struggling people by only 3.1 per cent last month – far below the inflation rate of 7 per cent and rising.
Now Mr Sunak has blamed the government’s antique computer system, despite previously suggesting it would be too costly and that other help is available.
“The operation of our welfare system is technically complicated,” he told Bloomberg News.
“It is not necessarily possible to [increase benefits] for everybody. Many of the systems are built so it can only be done once a year, and the decision was taken quite a while ago.”
Mr Sunak acknowledged that blaming the technology “sounds like an excuse”, but insisted he was “constrained somewhat by the operation of the welfare system”.
But the claim was disputed by experts who argued that – while changing so-called “legacy benefits” and pensions is complex – levels of Universal Credit can and have been increased at pace.
Paul Johnson, director of the Institute for Fiscal Studies, pointed out that Mr Sunak increased Universal Credit immediately when the Covid pandemic struck in 2020.
Torsten Bell, director of the Resolution Foundation, said: “The chancellor is right that it’s very difficult to change benefits outside the usual cycle, particularly for pensions. But these barriers can be overcome.”
The Department for Work and Pensions appeared to contradict the chancellor’s claim that the system can only be altered once a year, saying changes take “several months to process.”
It said legacy benefits use “complex and inefficient paper-based systems that are slowed further by aging, inflexible IT”, referring only to claimants not yet moved over to Universal Credit.
It said legacy benefits use “complex and inefficient paper-based systems that are slowed further by aging, inflexible IT”, referring only to claimants not yet moved over to Universal Credit.
Angela Rayner, Labour’s deputy leader, poured scorn on the claim, tweeting: “Computer said no? He’s insulting your intelligence.”
The effective benefits cuts have sparked warnings that many more people will be forced to go to food banks and that Mr Sunak has turned a “cost-of-living crisis into an emergency”.
The Treasury watchdog, the Office for Budget Responsibility, has forecast that Britons will suffer the biggest fall in living standards since records began in 1956.
At his spring statement, the chancellor chose instead to raise national insurance thresholds – to partly mitigate the increase in the rate paid – and pledge future income tax cuts.
An emergency town hall fund was increased by £500m, but councils have warned that fails to compensate for previous cuts to their assistance schemes.
