Coalition in big welfare shake-up
IAIN Duncan Smith, the work and pensions secretary, will today unveil plans to scrap all out-of-work benefits and replace them with a single payment, in what will be billed as the biggest welfare shake-up in decades.
A so-called “universal credit” will replace the myriad of different benefits that are currently available, including housing benefit, jobseekers’ allowance and income support.
Crucially, the credit will also be available to those working in low income jobs, to ensure they don’t lose out when they move off of benefits and into employment.
Duncan Smith is expected to say: “For many people, taking a job leaves them no better off than a life on benefits, and this has trapped significant parts of our society in inter generational worklessness and entrenched poverty.
“The complexity of the system also creates risk and uncertainty for the people in society who most need stability. We want to simplify the system to make it clear that work will always pay.”
The proposals will be unveiled in a command paper entitled 21st Century Welfare. It will outline plans to combine the benefits and tax credits systems; combine out-of-work and in-work benefits into a single system; and introduce a series of supplementary payments for the most needy, such as the disabled.