New integrated IT system planned for DWP

New systems needed to support coalition's welfare reforms

Reforms to welfare system require rejig of IT support systems

Proposed reforms to the welfare system will include creating an integrated IT system for claims and payments, according to the Department for Work and Pensions (DWP).

Changes to the welfare system will include combining elements of the income-related benefits and tax credits system; merging out of work and in work support together in a simpler system; and supplementing monthly household earnings through credit payments.

According to the 21st Century Welfare Paper, released today, the IT changes required to manage such a system would not constitute a major IT project as they would involve building on existing technologies.

A statement in the paper says: "We envisage an integrated IT system to manage all claims, and a single payment system to apply a withdrawal rate and pay the correct entitlement. These would not be entirely new systems and could be built on our existing IT and capabilities."

The planned system for managing claims would gather evidence and assess a household’s entitlement to support, and could be built using existing technology used regularly in both the public and private sector, the paper said.

The payment system could be built around the BACS system, which is already used to pay benefits to 96 per cent of claimants, the DWP said.

Payments for self-employed people and others not covered by the PAYE system would need to be delivered differently but would be part of the system.

Meanwhile, HM Revenue & Customs is seeking views from employers and payroll providers on mechanisms that could support more frequent or real-time collection of PAYE data.

Such a system could also present opportunities to use real-time earnings data in the calculation of entitlement. Access to real-time earnings data would remove the need for customers to notify changes of income, and make the system more responsive to fluctuating earnings and movements into or out of work. This could largely resolve the issue of overpayments and subsequent repayments, which hit the poorest hardest.