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Duncan Smith: welfare reforms will save money and get people back to work
Work and pensions minister Iain Duncan Smith is proposing to overhaul the welfare state with a new universal benefit that he claims will cost less and remove artificial barriers to work.
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More FTSE charts & pricesby Gavin Lumsden on Jul 30, 2010 at 08:53
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Work and pensions minister Iain Duncan Smith is proposing to overhaul the welfare state with a new universal benefit that he claims will cost less and remove artificial barriers to work.
Work and pensions minister Iain Duncan Smith has insisted his ambitious welfare reforms are fully costed and have the support of the chancellor George Osborne.
Former Conservative party leader Duncan Smith is unveiling proposals today to overhaul the country’s complex benefits system and remove barriers for getting unemployed back to work.
One of the options in a DWP discussion paper is to replace existing income support and housing benefit with one universal benefit.
Duncan Smith hit back at critics such as former Labour welfare minister Angela Eagle who has claimed the change would cost £7 billion to implement.
Before the election Duncan Smith published a report with the Centre for Social Justice which put the bill for this reform at £3 billion upfront.
Duncan Smith told BBC Radio 4’s Today programme that the universal benefit was one of four options presented in the paper. More formal proposals in a white paper in the autumn after the government’s spending review.
He claimed the reforms had the backing of the Treausury and, despite Labour attacks, attracted cross party support. Although money was tight after the emergency Budget, he said radical change to the welfare system would ultimately save billions.
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6 comments so far. Why not have your say?
Geoff Robbins
Jul 30, 2010 at 10:41
This needs to be done. The fact that people immediately lose benefits when they sign off is a huge disincentive on its own. To expect claimants to earn less when employed is ludicrous.
On the flip side of the coin, currently large employers are being subsidised by the taxpayer. They can deliberately employ staff at deliberately low wages in the certain knowledge that they can claim tax credits to bring it up to a living wage. In other words we are giving the money to the shareholders of these companies.
report thisDavid Warner
Jul 30, 2010 at 10:43
Well Labour had already effectively abolished non-means tested benefits by replacing unemployment benefit with jobseekers allowance and incapacity benefit with employment support allowance.
Lots of work for French medical outsourcing supplier ATOS!
Partner-led workfare (another major waste of money) actually seeks to make people work in "job placements" for no cost to the employer for a six month trial period - that is already up and running courtesy of Gordon Brown.
Can't see what more Duncan Smith can do - unless he expects people to work on placements for nothing at all. Angela Eagle may be right if IDS is expecting DWP to administer some kind of "sliding scale" benefit arrangement as people get back into work. DWP can't even run flat rate benefits properly - the scope for admin cock-ups is enormous.
What all these coalition ministers are ignoring is the plain fact that they are shrinking the economy and reducing the number of jobs. How can you force people into jobs which do not exist - whilst simultaneously making the jobless situation much worse?
report thisDavid Warner
Jul 30, 2010 at 10:46
Geoff Robbins point about Tax Credits is well made
report thisJohn Percy
Jul 30, 2010 at 11:33
Sounds good. Biggest problem -- Where are the jobs in the volume required?
report thisClive Oram
Jul 30, 2010 at 12:04
The biggest "cost" in benefit reform is reduced administration within the civil service. Whitehall will go to extraordinary lengths to protect its position and staff including providing misinformation and "legal" arguments as to why reform will not work. If they are forced to carry out any reform you can be sure they will make the administration as complicated as possible
report thisBrian Meek
Aug 03, 2010 at 09:45
If IDS wants to get people back into work is he going to supply the jobs? This government is cutting jobs. Is this the big society? MPS get paid handsomely, pass their responsibilities on to everyone else and provide no means of support for the slack to be taken up.
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