The Welfare Reform White Paper Universal Credit: Welfare That Works published today (11 November 2010) sets out details of the Government’s programme to overhaul the welfare benefits system and tackle the ‘culture of worklessness’.
The new Credit, available for people both in and out of work, will provide a basic amount with additions for those with children and other caring responsibilities, people with disabilities and those with housing needs.
The Government says the new Universal Credit will ensure that support is withdrawn slowly and rationally as people return to work and increase their working hours, meaning that they get to keep more of their earnings for themselves and their families regardless of how many hours they work.
Launching the White Paper, Iain Duncan Smith, the Secretary of State for Work and Pensions, said: “With five million people trapped on out of work benefits and almost two million children growing up in homes where nobody works, we cannot afford to simply continue tinkering around the edges of the welfare system. Only root and branch reform will do.
“At its heart, the Universal Credit has a simple ambition – to make work pay, even for the poorest. This will finally make it easier for people to see they will be consistently and transparently better off for each hour they work and every pound they earn.
“It will cut a swathe through the massive complexity of the existing benefit system and make it less bureaucratic to run. And by utilising the best data technology available, we will streamline the system to reduce administration costs and minimise opportunities for fraud and error at the same time.
“This will change Britain for generations, and make sure we have a welfare system fit for the way we live and work today.”
Chief Executive of Carers UK, Imelda Redmond CBE, said:
“Carers UK welcomes some key principles in the White Paper, which could deliver a simpler, less complex benefits system for disabled people and their families. There are nearly 500,000 working-age people currently in receipt of Carer’s Allowance. Over half of these carers, those who currently receive a carer premium to Income Support or Jobseeker’s Allowance will be moved to the new Universal Credit, and we are pleased that their benefits will not be conditional on seeking work alongside caring. However the remaining 245,000 who receive Carer’s Allowance will be left with a benefit which is stuck in the 1970s, and we are disappointed that Government did not take this opportunity for reform.
"Every day, carers face many of the difficult challenges that this White Paper is specifically designed to address – poverty, disincentives to work or study and systemic complexity and inflexibility in welfare. This package of reform was a key opportunity to tackle these challenges for carers and deliver the support and recognition that carers need. In announcing the White Paper the Government stated that it now is the time to grasp the nettle, and find solutions to some of the perennial problems in welfare. Carers will ask why their benefit alone has been left on the ‘too difficult’ pile.
"We understand that there are real challenges in reforming Carer’s Allowance. Any system would need to retain a universal benefit which does not force people who are caring for loved-ones to look for work, or deliver a regressive means-test which would leave some carers with no independent income of their own. However carers are living in poverty and hardship now, and reform cannot be postponed any longer.
"The Government has said that it will now look carefully at what happens to Carer’s Allowance. We urge them to bring forward urgent plans for a radical overhaul of the Allowance, to give carers a decent income and help those who are able, to juggle caring with work or study.”
Notes: Approximately 255,400 Carers who currently receive the Carer Premium (an additional amount for those with caring responsibilities) to Income Support and Jobseeker’s Allowance would be moved to the new Universal Credit. The White Paper states that these carers would be exempt from ‘back to work’ benefits conditionality.
The remaining 245,000 carers will remain on Carer’s Allowance. Carers UK will be submitting a full response to the proposals, which will be available from www.carersuk.org The full White Paper can be found at www.dwp.gov.uk/docs/universal-credit-full-document.pdf