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17 March 2008Welfare Reform
The Government is committed to building an inclusive and fair society, and a prosperous economy, where everyone has the opportunity to fulfil their potential.
Full employment is at the heart of the strategy. The Government has a long-term aim of an employment rate of 80 per cent. It will help us to combat poverty and ensure Britain is well placed to respond to economic change, and reap the benefits.
The Government wants as many people as possible to share in the rewards of work. They believe that paid work is the best route to independence, health and well-being for most people.
We have already made significant progress with the introduction of a series of radical reforms to improve the opportunities for people to work. But more needs to be done.
No one written off: reforming welfare to reward responsibility
The next step in the journey of radical welfare reform will simplify the benefits system and deliver greater and more personalised support for people in return for more responsibility. The majority of people of working age – who can work now or at some point in the future – will no longer be on benefits for life without getting the support they need to get back to work.
On 21 July, we published No one written off: reforming welfare to reward responsibility which sets out a range of options to:
- simplify the benefits system – moving towards a more streamlined system based on just two working age benefits: Employment and Support Allowance (ESA) for those who have a medical condition which prevents them from working and Jobseeker’s Allowance (JSA) for everyone who is fit to work
- ensure that for most people out of work benefits are only temporary – there is not a right to a life on benefits
- require most people on benefits to contribute actively in return for their benefits
- provide more support for disabled people to get into work and keep their jobs and more control over the support they get
- provide a full disregard for child maintenance payments, so that payments will not be taken into account when calculating how much out of work benefits a parent should get.
The paper is open for full public consultation until 22 October 2008, the results of which will feed into a Bill in the next session of parliament.
The story so far
Building on the platform of a well-run economy, we have:
- created Jobcentre Plus as a world leading welfare to work organisation
- introduced innovative employment programmes such as the New Deals
- rolled-out Pathways to Work nationally for people on incapacity benefits
- improved incentives to work by providing greater support through the tax credit system and the introduction of the minimum wage.
Together, these reforms have led to an enormous improvement in the performance of the UK labour market. We have a record number of people in work, and the numbers on key out of work benefits have fallen by around one million since 1997.
Looking ahead
To build on this success, the Government has already announced further reforms:
- Employment and Support Allowance will replace incapacity benefits for new claimants from October 2008 and will focus on what people can do, rather than what they can’t
- Jobcentre Plus will start running work skills trials from October 2008
- a stronger framework of rights and responsibilities for lone parents will begin in November 2008.