The 2015 IntoWork Convention began with the announcement from Dave Simmonds OBE, Chief Executive at Inclusion that, building upon the strategic alliance formed between Inclusion and NIACE earlier this year, a full merger will now take place and 2016 will mark the creation of a new organisation. An organisation which will champion employment, skills and learning for all and that shall continue to deliver a high standard of relevant and practical research and policy development, providing real benefit to people, employers and the economy.
IntoWork 2015 opened with the UK labour market in a markedly improved position than in recent years, with unemployment down 25% compared to June 2011 and the JSA count dropping 50%. Furthermore, youth unemployment has decreased 16% and there are now just 2.5 unemployed people for every reported vacancy compared to 5 per vacancy in 2011; however such improvements are not across the board. The ESA claimant count remains stubbornly high at 2.5 million, falling just 4% since 2011, meanwhile the number of people in work suffered a shock decline of 67,000 – both factors illustrate the fragility of the issues shaping the UK labour market and the need for pioneering policies and innovative organisations.
With the current labour market context in frame, alongside the manifesto commitments of the new government, including a commitment to full employment, halving the disability employment gap and the promise of further devolution; leading policy makers, practitioners and stakeholders from the employment and skills sector met to share best practice, debate policy and bring about the innovation, creative thinking and new approaches needed in order to address the needs of disadvantaged individuals.
The Breakout Sessions formed an important element of the day’s proceedings; with over 50 debates, seminars and presentations engaging people from across the industry and providing a platform for attendees to share their experiences within the employment, skills, justice and health sectors.
The key three issues raised during the conference were:
1. Integration – Bringing health, employment and skills together to produce a better set of outcomes for individuals, communities and the economy and to prevent people from falling through the service gap. Key Speaker Priti Patel MP, Minister of State for Employment stressed that the answer to getting those with health conditions into work was a combination of reforms to further integrate stakeholders, employers and providers, resulting in effective provision in order to secure employment outcomes with the power to transform people’s lives.
2. Devolution – Building upon the opportunity from the integration of support services and working with stakeholders and providers to develop new, more localised services to clients who have not been as well served by previous programmes whilst concentrating on sustainable growth, justice and inclusion. David Hughes, Chief Executive NIACE presented the opportunity that devolution offers in terms of rethinking the existing system in order to create a more personalised and localised approach.
3. Personalisation – Offering a more individualised service to help users think about their abilities and how they can contribute to their family, community and the economy, as well as getting the correct support to help them achieve better outcomes. Stephen Timms MP, Acting Shadow Secretary of State for Work and Pensions highlighted the need, both morally and economically, to make sure that everybody is given opportunities in a way which is approachable and inclusive for them.
For further insight into the IntoWork Convention 2015, keep an eye out for Whitney’s blog detailing her experience of the event.
Dave Simmonds OBE, Chief Executive of the Centre for Economic and Social Inclusion, delivered the following speech to the IntoWork Convention on 14 July 2015.
I want to start by paying tribute to the hard work and dedication of everyone working to help unemployed people find work – improving opportunity, improving lives. It’s a sad fact that you often get little thanks. The media is always ready to have a go, claimants are fearful, and the push for performance is relentless. We should recognise more, and value more, all those who are on the front-line, trying to make this country more inclusive – providing a safety net when one is needed and opening doors to new opportunity. So to all front-line staff wherever they work – a round of applause.
New government, new manifesto commitments and the latest Budget, these set the challenges for tomorrow but first let’s reflect on the changes in the labour market, in particular, since the Work Programme opened its doors in June 2011:
• The wide unemployment measure has fallen from 2.4 million to 1.8 million today – a drop of 25%
• JSA was 1.5 million and is now 750,000 – a drop of 50%
• Youth Unemployment was 900,000 and is now 750,000 – a drop of 16% • There were 5 unemployed people for every reported vacancy, and it is now 2.5 – a much tighter labour market.
• However, the number of ESA claimants was 2.6 million and it is now 2.5 million – a drop of just 4%, but numbers have been rising since summer 2013.
This is the backdrop for our discussions at this Convention and the implementation of the labour market manifesto commitments of the new government.
First, a commitment to full employment – agree 100%, so long as its inclusive growth and inclusive full employment, as we said in our report for the TUC last year.
Second, halve the disabled employment rate gap – agree, we calculate this will mean helping almost 1 million people with health conditions and disabilities into work over the next 5 years. We set out last year how this could be achieved in our Fit for Purpose report, which many of you were involved in.
Third, a new Youth Obligation for 18-21 year olds – agree, we have always advocated ‘learn and earn’ for young people. But removing Housing Benefit is a mistake - it could end up costing more than it saves.
Fourth, an additional 3 million Apprenticeships – agree, so long as young people and the unemployed have greater access, and more Traineeships can provide increased access for the low qualified. And let’s not forget we also need to promote lifelong learning so that adults can make the best use of their talents and boost productivity.
Fifth, provide significant new support for mental health for claimants, and review how best to support those suffering from long-term yet treatable conditions – agree, so long as this is integrated with back-to-work support. Take down silos, don’t create new ones. And tread carefully before proceeding with proposed new sanctions for vulnerable people.
Sixth, devolving responsibilities to Scotland, Wales, cities with Mayors and potentially other areas – agree, whilst we know DWP is cautious, fearing a loss of performance and an increase in costs, we also know that giving more powers to local economies is a key part of the governments Productivity Plan, announced last week. I haven’t mentioned the Work Programme, or other employment programmes. That’s because they never really figured in the manifesto. Nonetheless, we know there are active discussions within DWP about what should replace current programmes after April 2017. Priti Patel has some big decisions to take, and soon.
Based on the new labour market context, the lessons from current contracts, and the manifesto commitments, we think the guiding principles for new contracts need to be: First, doing better and more for ESA claimants. Even with fewer than anticipated in the ESA Work-related Activity Group we predict ESA referrals to the Work Programme will outnumber JSA referrals at some point in the next two years (all things being equal). We also need a much better, and voluntary, offer for those in the ESA Support Group. Delivering this will need much more integration with health services, especially at the local level.
This is a major challenge requiring pioneering policies and innovative organisations to deliver. Remember, twice as many are joining the Support Group compared the WRAG group. Failing to recognise this will take us back to where we started in 2005, with the vast bulk of people on sickness benefits not getting support and poor outcomes for those that do. Second, delivering for long-term JSA claimants who are smaller in numbers, but more challenging to find work. Improving employability for people with multiple disadvantages will need more integration of services and budgets. Here we have to ask how the expanded DCLG Troubled Families programme will fit? After claims of success, it will be expanded to 400,000 over the next 5 years. It will clearly be absurd if both DWP and DCLG end up knocking on these people’s doors – if they do it will add a whole new meaning to a ‘troubled family’. Third, doing more to tackle low skills.
A qualification deficit is a significant disadvantage to a claimant. Meeting employer demands for ever more qualified staff is a challenge for the whole country. Employment programmes must play their part to increase productivity by boosting basic skills and improving qualifications. Improving qualifications boosts employment chances. Improving learning, improves jobs and well-being. This is particularly important for young people. There is a potential for an exciting new programme to help workless young people – many of whom have been failed by our education system. The Youth Obligation needs to deliver on this – tackling jobs and skills together. Finally, tackling low pay by improving progression. Much has been written already about the new National Living Wage, but raising the wage floor by 50p will not solve our endemic problems with low pay – where one in five workers earn below a living wage and many struggle to escape. And there is always the concern that it could lead to larger job losses than predicted. We are developing with the Trust for London new pilots to test approaches to tackling low pay, and evaluating others for DWP. As a country, we should be more ambitious in promoting Career Advancement – not just ‘making work pay’ but ‘making careers pay more’. One theme running through all of this is ‘integration’. With health, with skills, with specialist services, with local initiatives, with LEPs on the European Social Fund. Always easy to talk about integration, much more difficult to deliver. But we can’t afford not to deliver in the future, because: First, the forthcoming Spending Review will be tough – especially tough on the unring-fenced budgets of DWP, BIS and local government. We expect programme budgets to go down significantly and that there will be a wider use of PBR and Social Impact Bonds. SIBs may be able to supplement provision but they cannot replace mainstream provision. Second, the cuts in welfare will have a direct impact on the incomes of all the families and individuals we work with. It is no surprise the IFS found that the Budget hit the poorest hardest. Of course the National Living Wage for over 25s is welcome but it will not compensate for the loss of tax credits. We shall see: • Significant income reductions next April for some families • A relative decline in income for all claimants for the next 4 years • Reduced incentives to start work, especially for workless families • Reduced incentives to work more hours or even to progress in work • And, a rise in child poverty. We have always supported the principles behind Universal Credit, but the Chancellor’s changes threaten to undermine ‘making work pay’. Claimants (both in and out of work) will be uncertain, nervous and fearful. Many local authorities, housing associations and providers responded to the last reforms with increased support and advice for those most affected. We need to do that again, and re-double it – many more will be affected with consequences for children, increased demand for food banks, and more in crisis. We’ve carried out extensive research on local impacts of welfare reform, and one of our clearest conclusions has been that where we work together – across employment, welfare, housing, health and skills – we achieve so much more together than when we work apart. This is why the devolution debate is so important. Planning and delivering integrated services that meet the needs of local people, employers and the local economy. Raising productivity, rebalancing the national economy, delivering inclusive growth. Our challenge is to help deliver all three. To finish I want to say what we at Inclusion will be doing to help encourage integration. As many of you know, earlier this year we formed a Strategic Alliance with the National Institute of Adult Continuing Education, NIACE. Today I can announce that we have decided to commence the process of a full merger. Our intent is the merger will be complete by January 2016 and a new organisation will be born. An organisation which will champion employment, skills and learning, not just for the unemployed, but for all on low incomes who want to progress in their careers. Not just talking about integrating employment and skills but practicing what we have preached. There will be changes, and this is what you will notice.
First, our combined research teams will bring the benefits of increased capabilities and capacity. Delivering high standards of independent, relevant and practical research. Second, through our policy work, and our events, we will do more to champion the needs of all those out of work and those who want to progress in work.
People will ask “what will you be called” and “who will head it up”? Today, I can tell you the answer to one but not the other. There is no new name as yet but we intend to announce this in the Autumn. In the mean time we will be consulting with members and supporters on what they want to see from the new organisation. So “who will head it up?”. I can say today this will be David Hughes, the current CEO of NIACE. Having co-founded Inclusion I would, understandably, want to see our legacy both survive and improve.
I have no doubt that David is the right person to do that. However, I will be staying involved. Helping David put the new organisation on a firm footing and continuing to make my mark on policy and research. So this means after 16 Conventions, this is my last Convention as CEO of Inclusion. It has been an honour to work with so many dedicated people over the years.
We are One industry – employment, skills, health Together we have one task – sustainable jobs.
The IntoWork Convention 2015 brought together a wide variety of people involved in helping people find work, keep work and progress in work. Over two days engaging debates and discussion promoted learning about current and future challenges to the sector.
Please click on the pictures to hear more from some of the speakers.
Dan Finn analyses the figures DWP published on benefit take-up - after a gap of three years.
After a break of three years the DWP finally published take-up estimates for most means-tested benefits. They were released on the same day as the child poverty data and received less attention than usual. HMRC’s pre-Xmas release of tax credit take-up also attracted little attention.
The data on benefit take-up matters, as was shown in the strength of criticism that forced the previous government to drop its proposal to cease publication of the annual statistical series. Robust estimates of take-up give an insight into the actual delivery of cash transfers and low take-up can exacerbate hardship and undermine public policy objectives.
The latest statistics show that take-up rates did not improve under the Coalition government. In 2012/13 Pension Credit take-up was between 61% and 64%; for Income Support and Employment Support Allowance between 77% and 81%; for Jobseekers Allowance (Income-Based) between 55% and 61%; and for Housing Benefit between 79% and 82%. The only significant change was an estimated 17% increase in take-up of Housing Benefit amongst claimants in work between 2009/10 and 2012/13, possibly reflecting increased rents and the squeeze on wages of the low paid. The separate HMRC ‘central estimate’ of the caseload take-up rate for child tax credit in 2012/13 was 88% dropping to 66% for working tax credit which was received by only 34% of eligible households without children.
Although take-up rates measured by expenditure are higher the evidence shows that many households are not receiving significant amounts which if claimed could help reduce child and pensioner poverty. The increased income associated with greater take-up would also contribute to improvements in other outcomes, such as health, family well-being and employment participation and retention.
Why people do not claim what they are entitled to is the result of the interaction between social and economic circumstances, administrative structures and complex eligibility rules. Findings from a comprehensive evidence review confirm well-established factors that continue to shape non-take-up. The most significant, from the eligible claimants’ point of view, concern the level and accuracy of knowledge about an entitlement and its eligibility rules, linked with the perceived cash value of the benefit when compared to the effort involved in claiming and maintaining entitlement.
Take-up is undermined by poor benefit design and problems with service delivery and it has also been explicitly discouraged for some groups. In particular, increased conditionality, and related sanctions, are designed to get people into work as quickly as possible and as a result, make their claims to benefits relatively short-lived. However, a side effect has been that eligible unemployed claimants have become ‘disconnected’ from the benefits and employment services system.
A further recent factor is likely to have been the character of the public debate and media coverage of welfare dependency, which has increased the stigma attached to those claiming benefits, especially people of working age. Research findings suggest that this stigma is linked to reductions in take-up and a reluctance to claim among potential beneficiaries.
Means-testing will remain at the centre of the British welfare system and take-up of benefits will be a significant factor shaping the impact that welfare reforms will have on future poverty. The introduction of the Single Tier Pension from 2016 may reduce means-testing for many pensioners, but even when it is fully implemented up to a third of pensioners will rely on Pension Credit and support with Council Tax and rent costs. Universal Credit is expected to increase benefit take-up, especially amongst the poorest households, but it seems unlikely that it will not also have negative effects. There is a risk that digital delivery, for example, may reduce and deter take-up amongst people who do not have the skills, capacity or means to navigate digital channels.
Whatever the welfare cuts announced by the Chancellor in the emergency budget the Government itself clearly has the primary responsibility to ensure that potential claimants are informed of their eligibility, the claims process is facilitated and that services are targeted adequately at the many disadvantaged groups (who the evidence shows are less likely to claim their entitlements). The UK’s devolved administrations, councils, health authorities and voluntary organisations will also continue to have an interest in promoting take-up of benefits. Investment in take-up services and targeted campaigns typically generates far more in additional benefit income for poor households than they cost to deliver with the greater income increasing expenditure and economic activity in low income communities.
While there are contending views about why some take-up rates are low it should be possible for all to agree that households on low incomes should be encouraged to take-up the in-work and out-of-work means-tested benefits they are entitled to. It is important, therefore, that the Government monitors the impact of welfare reforms and commits to annual publication of take-up data, including in future Universal Credit, and for the series to estimate take-up of Council Tax support. If Universal Credit does not improve take-up rates, which the Government has claimed, the DWP should consider setting and committing to an independently assessed indicator giving the level of take-up it wishes to achieve, which would help drive future improvements.
Dan Finn is a Professor at the University of Portsmouth and the evidence review which was commissioned by the Joseph Rowntree Foundation can be found here
After weeks of briefing, on Monday we got the clearest indication yet that tax credits are going to bear the brunt of next month’s welfare cuts. In more ways than one, it looks like the 2015 Budget will relive the mistakes of 2010.
There is now a remarkable consensus across right and left that cuts to tax credits is a solution seeking a problem. Both the Institute for Economic Affairs and Adam Smith Institute have set out that tax credits don’t ‘subsidise’ bad employers; the TUC that tax credits are well-targeted on low income working households; and the Institute for Fiscal Studies that cutting tax credits will increase child poverty. And it is inescapable that making people worse off in work, and worse off with more work, will do nothing to address the challenges of low participation and low pay that this government – to its great credit – says that it wants to address. If anything, it will make those problems worse.
Back in 2010, as we have shown in work for the Local Government Association, tax credits made up the largest part of the planned £16 billion annual cuts in welfare. I was in government around that time, and then as now there was no grand plan for welfare reform. Then as now, officials were set arbitrary deadlines to come up with arbitrary cuts that could be ‘scored’ in order to meet an arbitrary target. There was no secret plan, no silent conspiracy - just the numbers and the dates.
So this time no doubt, DWP’s Housing Benefit division will have been told to find £3bn (answer: cut the Local Housing Allowance a bit more, lower the HB caps); HMT’s Tax Credits team will have been told to find £5bn (cut everything); and the rest will have been told to squeeze the pips some more – freeze benefits, cut Universal Credit work allowances, lower the benefit cap, cut the few remaining discretionary grants, get a bit off passported benefits.
The consequence – then as now – is incoherence and contradiction. In our impact assessment from 2013, we showed that the large majority of the cuts in the last Parliament fell on households where someone worked. By once again going after tax credits – where three quarters of spending goes to working families – those impacts on working families will be far worse.
Last summer, we set out our take for the TUC on what ‘full employment’ should mean and what we need to do to get there. We followed this up with our ‘Fit for Purpose’ project on how we transform support for disabled people and those with health conditions. The year before, we set out in work for Trust for London a framework for improving in-work progression for the low paid. Across all of these areas, there is a common theme: the need to match good intentions with the right support – to prepare for work, to find work, to increase earnings, to progress.
And this is the other area where we risk repeating the mistakes of the past. In 2010, as now, all of the focus was on what benefits should be cut rather than what support those households might then need - to find work, to increase their income or to move home. The detail of the Prime Minister’s speech on Monday bears this out: when you get to the bit about employment, the only meat on the bones is more apprenticeships (ring-fenced for the young, and almost always those not on benefit) and a bizarre reference to social impact bonds – despite there never having been a single bond for employment.
On Monday, we published our latest local assessment of the impacts of welfare reform, for Brighton & Hove City Council. This research shows not only the significant and cumulative impacts on residents, but also the extent to which those in crisis and at risk of crisis simply didn’t have the means to address their underlying issues around housing and particularly employment. We found the same things in research last year in Oxford City and in Tower Hamlets. Residents often receive excellent support in dealing with their crises, with services and agencies achieving more and more for less and less. But both agencies and claimants conceive of their needs in the short term. Despite most of those interviewed wanting to work or to increase their incomes, the support to do so is simply not there.
In our view, then, any debate about welfare cuts needs to be matched with one about how we extend, improve and align our support to those residents to find work and to increase their incomes.
In practical terms, this means ensuring that future employment programmes (whatever comes after the Work Programme) are better integrated with local services and include voluntary access for those that want it.
It means greater co-location of Jobcentre Plus and Council services, and then stronger partnerships with those services that are helping residents to deal with crises.
It means ending the arbitrary rules that prevent most of those impacted by welfare reforms from accessing the intensive family and employment services being run through ‘Troubled Families’ programmes.
It means ensuring that our European Social Fund investment – through which hundreds of millions of pounds is being targeted at supporting the most disadvantaged – is geared towards those affected by welfare reforms.
And it means developing those 'invest to save' models that the Prime Minister thinks already exist.
Doing all of this would go some way to addressing the mistakes of the last Parliament and preparing people for what is to come. And what is more, it would cost the government nothing.
For well over a year now Ministers have been lauding the increase in jobs and the fall in unemployment, but little noticed in the most recent labour market statistics was an increase in the number of people claiming Employment Support Allowance (ESA). In total 2.53 million are now claiming ESA, an increase of 60,000 people over the last 12 months. As usual the ESA numbers are hidden away in the official statistics, with government and media focussing on the (smaller) unemployment figures.
The main programme for ESA claimants is the Work Programme but since it started in June 2011 there have been just 292,000 ESA claimants join it and according to the latest statistics only 8% have secured a sustained job. Beyond ESA there are many more people with disabilities who are out of work – a total of 3.6 million people are disabled and not working. Even on the Work Programme less than half of the disabled people are ESA claimants. By ‘disability’ we mean all of those people that have mental and physical health conditions that limit their ability to work, and half of all those on ESA have mental health problems.
All three main political Parties recognise that something more should be done. The Conservatives say they “will aim to halve the disability employment gap”, Labour “will introduce a specialist support programme” and the LibDems will “simplify and streamline back-to-work support for people with disabilities.” So what needs to happen to make this a reality?
Inclusion worked with 22 organisations to develop radical new proposals in our report Fit for Purpose and in Ten Policies for Ten People we boiled this down to six practical proposals to start the process of reform. First and foremost is separating support for disabled people from the Work Programme. We need to re-structure employment and skills support for disabled people so that it reflects the different levels of support that people need. This would open up the possibility of recognising a greater range of outcomes, including qualifications. A basic principle that will need to run through the design of new policies will be greater ‘personalisation’ – recognising that each person’s combination of health and employability issues is often unique.
To deliver this means that there needs to be a drive for stronger partnerships between employment and skills providers, health services and local support. As a country we have singularly failed to join up these services for the individual. Support delivered by silos is invariably ineffective and inefficient and we need to foster (at all levels) a new capability in our services – one which brings together health, skills and jobs. Making this work for the individual needs highly qualified Personal Advisors, with manageable caseloads, who is there to provide support and not just to administer a welfare benefits.
A more local approach to planning and commissioning services could provide the drive to foster partnerships between health, employment and skills. This is why we propose a clear national framework which will enable new approaches to devolving and pooling budgets. However, in doing this we must not lose sight of the lessons we have already learned through previous programmes, pilots, and local initiatives. Hence our proposal to establish a ‘What Works Unit’ to collect, review and disseminate best practice.
Whilst unemployment may continue to go down, we can’t ignore the larger and increasing numbers on ESA. We can do better for people with health and disability problems but it will take a government which is determined to follow up on their manifesto commitment and understand this should be a national priority rather than an inconvenient statistic to be hidden.
If you are a Work Programme provider or an Independent Training Provider, and you are planning to hold an event to encourage people to take up your provision, then I have some news that should be of interest.
NIACE is operating a free service where you can register your events and maximise the number of participants who attend. The NIACE events calendar provides a practical method for you to encourage people to attend the events that you are already planning to deliver this summer. Under the banner of ‘The Festival of Learning’ NIACE is using the events registered to publicise the range and breadth of adult learning activities that take place.
The benefits of uploading your event to the Festival of Learning events calendar are:
• Increase the potential for your events to be seen by a new audience
• National Careers Service advisors actively promote the events listed to clients as opportunities to get back into education and employment
• Selected events will be shared or highlighted on social media and on NIACE’s website
• Selected events will be mentioned in NIACE press releases during the Festival of Learning.
In addition, NIACE has produced a Festival of Learning Toolkit that is jam packed with tips and suggestions on how to host an event, generate press coverage and boost your social media profile and reach. Other resources you’ll find online include web and social media banners, posters and logos.
One of the aims of the Festival of Learning is to encourage adults to take part in all types of learning activities and NIACE has chosen #lovetolearn as the festival’s overarching theme.
NIACE would love it if you could encourage your adult learners, event participants and event staff to share with us what it is that they love to learn. By using the hashtag #lovetolearn on social media (Facebook / Twitter / Instagram etc) and maybe even including a relevant image or a video the message will be picked up by NIACE and shared across our accounts to promote the importance of all forms of adult learning. We hope that by capturing the feedback from as many people as possible, we can clearly demonstrate to policy makers the breadth of learning that adults are interested in, highlighting the need to continue to fund learning opportunities for adults, particularly targeting the most vulnerable in society.
In conclusion, the Festival of Learning provides a unique opportunity for you to highlight the work that you do to a national audience by registering your events in May and June on NIACE's free online events listing You will add your organisation’s contribution to the voices of the hundreds of other learning organisations who have already registered their events , and will have the opportunity to influence policy by actively demonstrating the importance of adult learning to people’s lives.
Key dates: Festival of Learning 1 May – 30 June, Adult Learners' Week 13 - 19 June
Ian Bond (27/04/2015).
Duncan Melville looks at social security spending plans from the party manifestos
Yesterday, the Institute for Fiscal Studies (IFS) published its analysis of the tax and spending plans that have been set out by the Conservatives, Labour, Liberal Democrats and the SNP. Most comment has focused on the overall differences in the parties’ tax and spending plans. Here I try to dig a little deeper into the differences the parties’ outline for the future of welfare spending. The table below summarises the parties’ welfare spending plans and the IFS assessment of them.
There are big differences in the parties’ announced plans for welfare spending, but a lot of what might actually happen post-election is unknown. The Conservatives have proposed the biggest reductions in welfare spending, £12 billion and at the same time pledged not find these savings from spending on pensioners. Hence all £12 billion would need to be found from welfare spending on people of working age and their families. As the IFS has stated, finding cuts of this magnitude “will entail some very difficult choices”.
Last month the BBC reported on some options which the Conservatives had asked DWP officials to consider. These proposals do not feature in the Conservative manifesto, but they do outline the scale of the task required to get to £12 billion of welfare savings.
Overall for the six proposals which could be costed, the savings amount to £5.8 billion. So even if implemented with the Conservatives’ specific proposals the savings would total £7.1 billion still £4.9 billion short of the target of £12 billion of savings.
Where might this additional £4.9 billion be found? The IFS has produced estimates for the savings in welfare spending of different policy options in their February Green Budget. As an example, abolishing child benefit and incorporating it into universal credit could, according to the IFS, save £4.8 billion but remove entitlement for 4.3 million families. The savings from this would overlap to some extent with the £1.0 billion savings from limiting child benefit to two children per family explored by DWP, so the combined savings from these two measures enacted together would be less than £5.8 billion. Hence, a little more might be needed to get us to £4.9 billion. Cutting housing benefit by reducing the ceiling on what can be paid from the cheapest 30% to the cheapest 20% of properties is estimated to save £400 million – reducing help to £1.5 million claimants by on average £6 a week.
What is clear is that finding a further £12 billion of welfare savings will inevitably involve a radical shrinking in the scope of the welfare state and hit hard the pockets of the poorest in society.