Executive summary
1. The benefits system as it stands often provides incentives to stay on benefits rather than take on a job. We want to support people to move into and progress in work, while still supporting those in greatest need.
2. The Budget outlined the first steps in achieving these goals. However, the scale of the Government’s ambition in this area warrants the consideration of more fundamental structural reforms. This paper identifies the key failings of the benefits system and outlines the objectives we believe the system should attempt to achieve. We then focus on how we might seek to address these failings and outline some key issues we will need to work through to deliver a benefits system for the 21st Century.
3. The framework we are considering greatly improves on earlier reforms because it looks at the system of state support for the less well off as a whole and is designed to produce positive behavioural effects. We want to maximise work incentives while continuing to protect those most in need.
4. This discussion document outlines illustrative examples of structural reform, including options presented by external organisations.
5. Such structural reforms could enable us to deliver some fundamental changes to ensure that work always pays and is clearly seen to pay. We could achieve this through new rules on how much of their earnings people can keep without losing benefit and by withdrawing benefit as earnings rise at a single, reasonable, rate. This would mean that people taking the first steps into employment through a few hours of work each week would see substantial rewards for their efforts. It would also make the system much simpler.
6. We do not aim to reduce the levels of support for people in the most vulnerable circumstances but it is clearly important that we ensure support is well targeted, is fair to those on low pay and that the right money goes to the right people.
7. Finally, we are looking at how we could use smart automation to deliver support without the wasteful bureaucratic delays to payment that make the move into work more stressful than it needs to be. Similar technologies are already commonplace in the private sector and should make the benefits system quicker and more responsive for the customer and more efficient for the taxpayer whilst not increasing costs to business.
8. Our ideas would be consistent with possible steps to make aspects of the welfare system more localised. We will also be looking at individual measures for increasing work incentives and reducing the extent and costs of welfare dependency alongside consideration of reform of the structure of the system.
9. Subject to the outcome of this consultation, we hope to bring forward legislation early in the New Year to reform the benefits and Tax Credits system to make work pay. We would welcome views on how best to design such a system so as to meet our proposed principles and as part of our duties to have due regard to equality.
This consultation is now closed.
My openion is that there should be restrictions on benefits to immigrants atleast for one generation (say 20 years). Please stop this if possible or wait until they contribute something to this country economically.
Many millions of pounds are wasted within the benefit system by sending unemployed people on 13 week new deal courses. These courses are a total waste of money and provide no help what so ever to get people get back to work. It is not only the people attending these courses that say this but also Job Centre plus staff who have to send them on the courses.
This money would be better spent on those who want effective re-training or higher education. Take me for example, I attended one of these 13 week courses which cost the benefit system approx £2000 for me alone. The course was of no use what so ever. What I and many others want is, as a mature person, to attend college to gain qualifications in Health and Social Care. Unfortunately I am restricted in what I can do because of cost and the number of hours I am allowed to learn, under 16 hours per week.
If the government would recognise that people on benefits and trying to gain qualifications are doing far more than those claiming benefits and sitting at home. We need to be able to study for more than the current 16 hours before benefits are stopped, The money spent on these stupid and unproductive 13 week courses should be directed to colleges so that people like me can gain the vocational qualifications that are needed. It may take people like me 1 to 2 years to gain these qualifications but in the long run we will be better qualified and more productive in the area of employment of our choice.
Under the current system I know that in 6 months if I am still on benefits I will have to give up college to waste another 13 weeks on another back to work course which their own results show do not work.
Let those who want to improve their chance of employment, re train without the petty limitations on hours of study and the threat of losing benefits if we do not attend back to work courses. This will be cheaper and in the long run provide a better qualified work force.
“continuing to protect those most in need” and “do not aim to reduce levels of support for people in the most vulnerable circumstances”-even without questioning which people are to be categorised in this way (I fear a reduction to a negligible number) -the consequence of decisions already made to which I mentioned previously ensure that this clearly is not the case so far.
What are the joint outcomes both political and personal (ie those affected by these changes)? What is actually financially possible? These are questions that don’t seem to be answered yet. Are we really starting with the end in mind? Experience and research has shown that long term sustainable employment is a challenge not being looked at creatively. Is the long term agenda privatisation of e.g. Job centres if so lets get honest about it and focus on transition and opportunities. If not then JCP processes and approaches need overhauling. Treat people as individuals, remove fear based tactics and improve the skills of those working directly with clients to accelerate success.
Some of these interventions are expensive, is there will to pay for them? Are we concerned with short or long term gains – does this Government have the financial mileage and courage for radical reform that doesn’t de-motivate the job seeker?
What sort of independent research is being done before we put new contracts in place for the Work Programme to ensure we don’t just repeat past failures, resources are well targeted and meet the clients needs while at the same time enabling providers and staff to facilitate effective and compatible change. How are we evaluating the contracted training providers especially since the recent TV programmes regarding job seekers and a lack of a cliet centred approach? Targets are important but can we remove human compassion, and skilled facilitators these need to be factored into the contractual requirements and specification and evaluation process.
I can agree with giveing people who are fit and well, or able all the help possible to get back to work, but more care should be taken to make sure that unfit and ill people are not bullied and black-mailed into unsuitble jobs or make to feel like cheats. I have been refused ESA, even though the County Council have retired me and given me a full pension. It seems as if the Government are using Welfare Reform as a weapon, not an earned benefit.
Hi susan
I am very interested in your story, my partner who is disabled is just about to be retired on ill health, did they give you a reason why they have refused you, hope you dont mind me asking?
I agree that it appears to be a weapon to get people of benfits wether they are ill or not or order to save money
christine
Something should be done in the way employment agenies handle there employees, as me having plenty of bad experiences with them like, turning up to work on a night-shift at a place i worked for, had to get the bus and was a 30 min ride, and turning up to them saying the agency didn’t need me tonight !!! nd they never rang to say that i wasn’t needed for the night, also when they say temporary postion ongoing, it can most time mean they want you but only want you for a week or a few days, just to get you to work for them, put it simple they lie to you !!! im not saying all are like this, but this had happened plenty of times with me, and then you have to go through the whole system again to get your benefits, which can take 3-4 weeks, to recieve any money !!! this has happened to me before, its ok if you want odd work or part-time hours, but when they promise a job for 6 months and it turns out to be 4 days, it doesnt give you incentive to work for agencies, which alot of the jobs in the ‘jobcenters’ are, i know some agencies get a fee from the goverment for hiring people, and agencies are nothing to do with the goverment structure, but this an issue that alot of people i know have experienced.
There must be a minimum wage that is not less than a tenth of the top salaries in the country.
This will prevent a category of the ‘working poor’ and encourage the country to keep top salaries beyond the astronomical.
If the wages are spent in the country and not on imports, then money circulates, making more employment.
People with a fair wage are less likely to gamble as the only way to make money, or to drink excessively to drown their sorrows. So their money is spent on buying productive goods and services.