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Radical proposals to get unemployed people into work have been proposed by a Conservative think tank.
The Centre for Social Justice, founded by former Tory party leader Iain Duncan Smith, said those families with an annual income of more than £30,000 should lose benefits to help the income of those lowest paid.
Speaking to BBC Radio 4's Today programme, Duncan Smith said the current benefits system is "complicated and out of control".
The proposals could lift more than 200,000 children out of poverty, the report said, while it also stated the present benefits system deterred individuals from getting jobs.
But the move would cost an extra £2.7bn annually, a 3.6 per cent increase on the current cost of £74.4bn.
"Unless we put the system right now, we run the risk of increasing the number of residually unemployed, only this time it will manifest itself as large numbers of younger people permanently excluded from gainful employment," Duncan Smith said in the report preface.
"That is why we simply cannot go on talking about the importance of getting people into work while we persist in creating disincentives for the very people we say should be in work."
The report concluded that under the current welfare system, those claiming benefits were not better off than if they were to take on low-paid jobs of an income of up to £15,000 a year.
Recommendations include a more gradual rate of withdrawal of benefits as wages increase, allowing individuals to hold on to more of their earnings and to make working harder more rewarding.
And a simplification of the benefits system was urged, with just two benefits made available for people of working age, replacing the current 51 benefits.
These should be the universal work credit integrating the jobseeker's allowance and income support alongside a universal life credit which would provide an additional income to those with no earnings, containing benefits such as housing benefit and the child tax credit.
Responding for the government, welfare reform minister Jim Knight said: "Where on earth does Iain Duncan Smith get the billions of pounds for this when David Cameron wants to cut billions in public spending right now?
"And how would this help anyone into work if the Conservatives also want to cut support for the economy and the help to get people into jobs?"
Article Comments
How about for starters getting employers to pay a decent wage? If you pay peanuts expect monkeys.
It is all very well for David Cameron, Iain Duncan Smith and the rest of the Tory party to say let's reduce the amount in benefits paid to people. They have never had to live on benefits for a long period of time. It is not a soft or easy option by any frame of reference. It is a hard enough struggle as it is, without reducing what little money we do get off the state to make ends meet.
If they truly want to help people get back to work, create decent well paying jobs with the adequate transport to get to them.
What is the point of taking a job when after factoring in tax, NI and transport costs I am going to be worse off if I struggle now to make ends meet.
They should try living on benefit for a couple of months, not just a photo opp day or two to show the newspapers and television cameras they know what it is like. Maybe then they might see things a little differently. Stop giving money to the bankers and richest in our society, concentrate on helping the worst off onto their feet, and into a decent job that pays a reasonable wage.
Stephen Millman
16th Sep 2009 at 5:19 pm
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