Welfare reform


Influencing policy is rarely straightforward. Sometimes it takes a while for it to sink in. This week James Purnell, the Work and Pensions Secretary, has decided it was time to cut incapacity benefit, making it a “temporary benefit, not a permanent snare" and introduce the private sector into back-to-work programmes. Policies we have been advocating for quite a while.

When the Adam Smith Institute released Why Unemployment and Why Not Work? A Radical Solution to Unemployment - published in 1985 and 1991 respectfully - welfare needed to be changed dramatically. Alas, despite tinkering with the system, the boat continued to head in the wrong direction, disincentivizing people to work. In 1979 there were 700,000 people on Incapacity Benefits, now the number is in excess of 2.5 million.

Last year we released a paper entitled Working Welfare. This called for all working age people not meeting national disability criteria to face immediate work requirements and the delivery of welfare to be devolved to local agencies, which would be paid according to results. Agencies would be rewarded for getting people into work for a set period of time, ensuring an ongoing and personalised service for jobseekers.

Decentralizing the system was essential to the policy proposals in Working Welfare and is key to its success. Yesterday, Frank Fields MP in The Times echoed this point. Let us hope that this government, or the next, heeds this message and that we don’t have to wait another twenty years this time.