A new report was published on 18 January by Civitas, an idependant think tank aiming to explore how to strengthen democracy: Fixing Broken Britain? An audit of working-age welfare reform since 2010, by Frank Field and Andrew Forsey, January 2016
Report abstract: The thorny issue of benefit dependency has bedevilled the welfare state since the 1970s, and has increased in importance with each successive decade. Welfare-to-work strategies since 1997 have begun to make inroads into the problem of long-term out-of-work claimants, which once seemed intractable. But, as Frank Field and Andrew Forsey highlight in this forensic examination of the welfare landscape, challenges remain.
First, the success story needs to be extended to certain groups – such as the disabled and the over-50s – who too often continue to be excluded from the jobs market. Second, much more needs to be done to ensure that those who are in work are able to progress up the pay ladder and out of poverty: too many people are in jobs which are so low paid that their incomes are only brought up to acceptable levels by the wage subsidy better known as tax credits. Effectively, the bill to taxpayers has been switched from out-of-work benefits to in-work benefits.
Tackling this will require an increase in productivity without an increase in unemployment. Only by raising output per worker – and ensuring that the rewards are fairly shared – can real living standards rise over time. This productivity challenge moves the welfare reform agenda into new territory, requiring engagement from beyond the Department for Work and Pensions as it links up with wider economic and political considerations.
Field and Forsey argue that by building on the foundations of the new National Living Wage, raising productivity and boosting the wages of the lower paid, the government can reduce benefits dependency still further and make significant additional savings from the tax credit bill.
New Statesman article, by George Eaton, 18 JANUARY 2016: Even if Universal Credit is eventually implemented, most will now lose out : Frank Field’s new report shows a programme hailed as revolutionary will penalise claimants.
Politics home article: Universal Credit won’t improve work incentives, says Frank Field