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The government has set out "radical" proposals today to reform the benefits system and move people from welfare to work.
Work and pensions secretary Iain Duncan Smith has unveiled a consultation, aiming to streamline and simplify payments, as well as improved incentives for the unemployed to swap life on benefits for work.
But opponents suggest the revamp is merely a cover for heavy cuts set to take place in welfare spending.
Labour has said the start-up costs of a new benefits system could cost as much as £7bn.
However the paper, emphasising the need to simplify the benefits system, contains no detailed costings of how the new system would work.
Options in the paper include, combining elements of the current means-tested benefits such as housing and council tax benefit, income support and tax credits in a single universal credit, keeping the broad existing structure but having a single rate of withdrawal as income from work rises
And through using other means of combining tax and benefits.
Launching the paper, Duncan Smith said: "After years of piecemeal reform the current welfare system is complex and unfair.
"For many people, taking a job leaves them no better off than a life on benefits and this has trapped significant parts of our society in inter-generational worklessness and entrenched poverty.
"The complexity of the system also creates risk and uncertainty for the people in society who most need stability.
"We want to simplify the system to make it clear that work will always pay. Our reforms should also ensure that the system is easier for individuals to understand and will reduce the high costs of fraud and error."
Shadow work and pensions secretary Yvette Cooper dismissed the proposals, saying: "Labour's minimum wage and tax credits made many families thousands of pounds better off in work.
"The ConDem Budget actually cut work incentives, cut jobs and cut help for people to return to work."
Article Comments
Look we all know that there has to be cuts, I dont think that there is anyone who thinks diffrently, but doing this is just a disaster for everyone.
Not taken into consideration that you would be hitting the very vaunarable, you would be setting the whole country into a down ward spiral, with the amount of money that it would cost to set somthing like that up, and there is no guarantee that it is going to work, and if it dose not then you have a further cost in trying to get it right, we all know that the system that we have at the moment is not great but at least its working for the best part.
Steven Riddler
30th Jul 2010 at 1:00 pm
It is easy to blame the present government for cuts. If the government does not control expenditure it will in years to come have to cut as money-lenders will not lend to UK.
This is what Labour learnt in the 70s, and what Obama is learning in USA, real money follows where real money is made. We can't keep borrowing to ease our difficulties we need to trade our way out of this massive inherited mess.
K Prosser
30th Jul 2010 at 12:52 pm
Iain Duncan Smith is arguing that his reforms will encourage people back to work, yet at the same time the government is scrapping the Future Jobs Fund which would have provided 80,000 jobs for young people.
Costing for the reforms is not being announced today. The government estimates it will cost £3 billion to set up the new universal benefit, while former Labour minister Angela Eagle has said that the Department of Work and Pensions during the last government costed the outline proposals at £7 billion.
Either way for the government to afford to do this will inevitably mean that other benefits not directly related to the unemployed will have to be cut, given the hardline message coming from George Osborne at the Treasury.
Gail Cartmail, Unite
30th Jul 2010 at 12:09 pm
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