Steve Webb MP writes: Making welfare work

As a Lib Dem Minister at the Department for Work and Pensions, I thought it would be helpful to comment on the Welfare Reform Bill published today.

I wrote in November that there is much in the Bill that we as a party should welcome. The Universal Credit sits comfortably with our own policy to introduce a single working-age benefit to replace the current nightmarishly complex system.

Today’s Bill lays a framework for a radical improvement in the way welfare works in this country. It will be simpler, clearer, and will target resources at those who need it most – 85% of the increase going to households with the lowest 40% of income – while fostering responsibility and independence.

Universal Credit will be flexible and dynamic, taking into the account the month-by-month changes every person experiences. This will be in marked contrast to the fiendishly complex tax credits system where people faced recovery of overpayments years after they received the cash. In all, this new system will lift 950,000 people – including 300,000 children – out of poverty and 2.7m households will be better off as a result.

The vigilant among Lib Dem campaigners will notice several measures speculated on in the press have been left out of the Bill. In particular, I am pleased to say that Housing Benefit is not going to be cut after one year for JSA claimants as was suggested. The Government listened to calls from Liberal Democrats and others and these changes show the significant impact that we are having on government policy at the highest levels.

Obviously in the context of an unsustainable government deficit there have been several difficult decisions to make. With that in mind it is remarkable that we are able to introduce reform at all, and even more so that the government has pledged over £2 billion extra funding for the Universal Credit to ensure it is a success. We will continue to ensure that the most vulnerable in society, especially severely disabled people are protected. In particular, the replacement for Disability Living Allowance will focus help on those most in need of help with the costs of ensuring their personal independence.

The flexibility of Universal Credit provides a framework for a welfare system fit for the modern world and its values of fairness and responsibility are deeply Lib Dem. I am proud that Liberal Democrats have had a crucial role in shaping the impact of the policy, and I hope that all our supporters will be pleased with the Bill today.

Steve Webb is Minister of State for Pensions

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15 Comments

  • Steve – all credit to you and your team for the successes you’re having and the difference you’re making helping to dismantle the fiendlishly complex and counter-productive you’ve inherited, by actually being in Government.

    Thought I’d get that in before the Cassandra Chorus arrived 🙂

  • @Steve Webb

    In all, this new system will lift 950,000 people – including 300,000 children – out of poverty and 2.7m households will be better off as a result.

    Interesting.

    Could you detail exactly how this will happen? And I mean actual real world things – not “by forcing/incentivising people to get jobs (that actually don’t exist)”

    the replacement for Disability Living Allowance will focus help on those most in need of help with the costs of ensuring their personal independence

    Very interesting. Estimates range, but most commentators expect over 1 million people to lose upwards of £90 a week thanks to these changes. And that only after humiliating periodoic health checks are performed by huge corporate machines, like Atos Origin. Sue Brown of the deafblind charity Sense said: “Some of our blind members might lose payments for using a taxi if, for example, they were given a white cane and told they could now move around.”

    Guy Parckar, acting director of policy and campaigns at LCD, said: “The Bill proposes replacing DLA with the new PIP. With this change comes a drastic reduction of spending – in the future the Government plans to spend £1 billion less each year on DLA…

    “We need assurances that reforms to this benefit will not push even more disabled people below the poverty line.”

    Mr Parckar also addressed the changes of payments to people in residential care. He said: “The proposal to stop DLA mobility component for people in residential care is still included in the Bill. However, it is positive news that the Government has agreed to formally review this proposal.

    “Disability charities and disabled people have overwhelmingly told the Government that this is a change that will have a devastating impact on people’s lives and runs completely counter to all the Government’s stated objectives to support disabled people to live independently.

    And as for taking credit for Housing Benefit changes – you’ve already been smacked down on that by IDS today. Don’t turn this into another humiliating climb-down, like the untruth about Lib Dems scrapping Trident.

  • @Cuse
    So because IDS didn’t declare that the Lib Dems forced changes to his bill, it follows that the Liberals we know argued against the housing benefit had no effect whatsoever? Right. The Conservatives now seem fairly happy with raising the income tax threshold, having an upper chamber elected by PR and ending child detention for immigration purposes, but I guess that had nothing to do with the ‘yellow Tories’ either. Give me a break.

  • * housing benefit proposal, that is

  • @Cuse

    You quote Guy Parckar saying “The proposal to stop DLA mobility component for people in residential care is still included in the Bill”.

    Where is this? It would seem Mr Parckar has not actually read the Bill as I cannot find any reference to DLA mobility being cut for people in residential homes! Yes it does include provisions to reform DLA to PIP (which we will need to watch closely) but there is nothing about a pre-emptive removal of DLA mobility for people.

    I suggest commentators and campaigners actually study the proposals (rather than assuming that everything speculated about in the press made it in) before shooting off a response. Otherwise it is them, not the government, who are responsible for the fear felt by many disabled people.

  • Dave Warren 17th Feb '11 - 4:16pm

    The system needs an overhaul and from personal experince i would say the following.

    * Something must be done about the disgraceful way the sick are being treated when
    they attempt to claim ESA. The current assessment process is designed to stop people
    getting payments. Its a disgrace.

    * Any new Welfare system has to be ‘people friendly’ and allow flexibility because the
    current set up is very much the computer says no! How people cheat the system i don’t
    know because it is so rigid and designed to catch you out in my expirience.

    Finally i am pleased to see that the 10% proposal has been dropped but please lets have
    no more of this type of proposal which is just penalising people unecessarily.

    I have worked full time for 30 years and had to give up work to become a full time carer.
    The DWP haven’t been very sympathetic or supported to me in my situation and any reform
    has to change this.

  • I see no Iceberg 17th Feb '11 - 4:47pm

    Why on earth are people still trying to claim this is all about the universal credit when the first real pilots schemes for it aren’t even scheduled to start for another two years in 2013 ?

    Full implementation has been pushed well beyond the next Parliament past 2015.
    In other words it’s only a possibility.

    The cuts to welfare aren’t being delayed or might never happen like the universal credit.
    They are being pushed through as we speakand are going to hit the poor very soon.

    When these welfare cuts hit the disabled and vulnerable it’s going to be a bit hard to claim that everything will be fine because of a universal credit that hasn’t happened and might never happen.
    Good luck with that as an excuse when real people are suffering.

  • Philip Rolle 18th Feb '11 - 1:05am

    I want to hear less about universal credit and more about how the Government will help benefits claimants who are suffering in 2011, particularly the disabled.

    As has been pointed out, the treatment of ESA claimants is a scandal and no liberal should be content to stay in government without trying to do something about that.

    Over to you Mr Webb?

  • Betraying the poor, sick and elderly to slash Britain’s deficit, all state handouts will be replaced from 2013 by a single universal payment.

    Department for Work and Pensions stated 1.7 million households will be entitled to less.

    Of the 1.7 million facing a fall in their living standards, 500,000 will be up to £25 a week poorer and 200,000 up to £75 worse off.

    Documents also revealed the cost of introducing the shake-up had increased from £2billion to £4.6billion.

    So to cut 5.5billion it is going to cost 4.6 billion…hmm

    There are many figure being produced but the article says…

    “this new system will lift 950,000 people – including 300,000 children – out of poverty and 2.7m households will be better off as a result.”

    Is this just a wish list?
    Because your own DWP figures according to reports don’t seem to agree, and the hidden parts are going to hurt more people…

    The hidden cost to the tax payer is going to continue to rise imo, never mind the cost to society.

  • A major beneficial reform of the welfare system would be the introduction of a citizen’s income as advocated by the Green Party.

  • Paul Kennedy 19th Feb '11 - 1:35pm

    Citizen’s income used to be Lib Dem policy too – and still is in some areas eg citizen’s pension, and of course our commitment to free universal healthcare (including long-term care) and education (including at least officially university education).

    Labour and the Tories will never agree to the citizen’s income because it challenges their tribal view that we should all be haves (natural Tory voters) or have-nots ( natural Labour voters); and it is too easy to attack in terms of “why pay benefits to wealthy bankers?” and even more toxically “why pay benefits to wealthy foreigners?”. I’m afraid we hear this too from the Orange-bookers (the response of course is that we tax the wealthy more). Realistically we will only get there through concerted efforts at European level.

    It is intolerable that the lowest paid in our society face much higher (often >100%) effective marginal tax/benefits-reduction rates on their incomes than the highest paid. Steve is doing a fantastic job in very difficult circumstances to tackle the means-tested benefits culture he inherited, but still needs our encouragement to make further progress, and realistically there is a limit to what we can achieve in a coalition with the Conservatives.

  • Ed The Snapper 19th Feb '11 - 8:57pm

    I have claimed benefits at various times over the decades and I think citizen’s income would be a great policy. It would recognise changing work patterns in modern society. It was a pity the LD’s dropped the policy and I would be happy to see it back as a policy.

  • david clayton 22nd Feb '11 - 11:31am

    I hope you enjoy your job and all the fancy benefits it accrues to you. Meanwhile the poorest people of this country are kicked all over the shop by a cabinet of millionaires propped up by the free market end of the Lib Dems and the inability of the rest of the party to do anything about it. We are entering a period of mass unemployment much of which is created by this government.
    Policy on benefits is being developed in an atmosphere of Golf Club politics in which it is taken for granted that all poor people are taking the piss and need a kick up the backside to sort them out. You and your party are disgracefully supporting this.

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