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Archive for October, 2009

The conservative’s proposal on Welfare reform

The conservatives have proposed
1. To simplify Labour’s different programmes into one single back-to-work programme for everyone on out of work benefits. This is new; whilst there have been calls for a Single Working Age Benefit (SWAB) no government has actually brought this in – although it has been said that the new Employment Support Allowance (ESA) goes some way towards this.

2. The Conservatives have proposed that the Work Programme will include back into work support for the 2.6 million people claiming Incapacity Benefits who are currently excluded by Labour. This is not new. All new Incapacity Benefit (IB) claimants will be placed on the new Employment Support Allowance which is geared towards identifying what these potential claimants ‘can do’ as opposed to what they cannot do. The Pathways to Work initiative was designed specifically to help IB claimants back into work. This announcement by the conservatives is therefore not new.

3. The Conservatives will abolish the Treasury’s rule that prevents the Government paying providers using the benefits saved once someone has a job. The conservatives have explained that this will allow them to offer support to the 2.6 million people on Incapacity Benefit. This is known as the AME/DEL problem and the government is already piloting this.

4. The conservative announcement included that they would offer greater support to young unemployed by referring them on to the Work Programme after 6 months of unemployment compared to a year under the Flexible New Deal. This is a significant development. Providers engaged in Welfare to work have been saying that those who are long-term unemployed – not just young people- need to be referred much sooner than 12 months.

5. The conservatives will pay providers by results with a focus on truly sustainable outcomes and bigger rewards for getting the hardest to help into a job. Flexible New Deal already accounts for this; however David Freud added that sustainable jobs should be 12 to 18 months. The government accepted this and is now working towards that with sustainability being increased from 13 weeks to 26 weeks and it will increase further.

6. The conservative plan essentially removes the exclusivity of JobCentre Plus provision and support between 6 months and a year. This is a faster and potentially more brutal approach to reviewing all – IB – claimants.

7. The conservatives say that one in five IB claimant is not entitled to the benefit; this means that 500,000 would be forced onto a lower benefit. To meet the target of clearing the backlog 3000 IB claimants would have to be processed every day. In contrast, the government has only committed to 10,000 assessments per week. Other than that it is not terribly different to Labour’s approach.

8. David Cameron’s commitment to use the private and voluntary sectors is already in place.

There is one area providers will have difficulty. Under the Conservative announcement welfare to work providers will receive only 20% of cash when they place a claimant into work, the remainder will be paid after the former claimant has been off benefits for a year. This will have serious cash flow implications for providers who are already being squeezed by the Flexible New Deal.

The conservative leader missed the opportunity to build on the report by Iain Duncan-Smith -Centre for Social Justice.
I am not suggesting that the Centre has got it right in all areas but it is a bold and courageous foray into an emotive and complicated area of policy.

As a result of the economic crisis, the government’s commitment to seeing full employment has been unceremoniously buried. The plans presented by Iain and his Centre for Social Justice will surprisingly do very little if anything to reduce the overall benefit count and rather than saving money it will cost more £3.6bn.

One would be forgiven for concluding that in these straightened times what is the point of such a proposal. However, if you pause for thought you will see that there is method in this madness.

• Firstly his proposals for a Universal Work Credit and Universal Life Credit would immediately simplify the entire benefit and employment system reducing the tiresome stream of 51 separate working age benefits into two simple streams. To give it credit, his conservative announcement did allude to a single benefit.

• Secondly, under Iain’s scheme no one would be disadvantaged. There would also not be a reduction in out of work benefits for any current recipient. This presumably means that many of the existing rules within each benefit will be rolled into the new benefit.

• Thirdly, this would ensure that the complexity of the benefits system, would disappear making it simpler, easier, less stressful, and cheaper to start and stop claims.

• Fourthly it would also remove the fear of the long delays experienced when jobs do not work out and a person has to start a new claim

In all it’s a bold offering from the conservative party, however it is clear that a lot of the proposals are currently happening or about to be implemented.

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There is no doubt that since 1997, New Labour has changed the language of politics and has indelibly changed the relationship between the citizen and the state. Under New Labour, there has been significant achievements, such as the National Minimum Wage; action on child poverty; investment in healthcare and education has yielded reduced NHS waiting lists; new educational facilities and record numbers of students going to university; help for pensioners; the creation of Sure Start; Tax Credits; and the 1.5 million people helped into work by the New Deal. Building on the work of John Major, we have achieved a peaceful solution to the Northern Ireland conflict. Britain has less crime and according to the British Crime Survey both violent crime and crime overall has reduced by 40% since 1997. Society has also become more tolerant and less discriminatory, aided by the Race Relations Amendment Act 2000, Civil partnership and the Equalities Bill.

Despite all this, under Gordon Brown’s premiership, the Labour government has been plagued with problems on multiple fronts such as the row over the Lisbon Treaty; counter-terrorism legislation and  42 days pre-charge detention; removal of the 10% tax band; poor performances at the despatch box; the Damian MacBride incident; the stalled part-privatisation of Royal Mail; difficulties in Afghanistan; murmurings in the cabinet; the resignation of James Purnell and Hazel Blears; and the positioning by other Ministers have served to fuel continual leadership speculation. Bigger than all of these is the economic crisis which has overshadowed Gordon Brown’s premiership and has blighted his record as a successful Chancellor.  Today, New Labour is dogged by a prevailing atmosphere of pessimism, crisis, a lack of a coherent strategy and confusion about where it is going.

Yet it would be wrong to pretend that Labour’s woes started when Gordon Brown took over. Labour’s problems go back much further and deeper, than that.

New Labour came to victory in 1997 on a wave of high expectations and optimism and it has largely delivered. ‘Choice’ became the defining mantra in New Labour’s approach to public services. Yet after choice, what can the electorate expect? The focus on choice has built up expectations without addressing underlying issues of structures, powers and responsibility. Where choice has been ‘achieved’, in health and education, people have been left with the feeling that real problems are still there because choice in itself does not offer a compelling vision for the future. The electorate wants more than choice because it can see that choice has not lanced the boil of poverty; deprivation; homelessness; unemployment; community cohesion; and they are very dissatisfied with many aspects of British life.

It looks like New Labour is set to leave office with the electorate hugely disappointed. It is however not only this which has left many feeling disappointed. After the ‘sleaze’ of John Major’s government, many hoped that New Labour would herald in an era of a more honest, open and accountable politics. Instead, New Labour has been marred by a plethora of incidents such as the Hinduja and the Bernie Ecclestone affair, the lead up to and the war in Iraq – which at its very mildest has caused the electorate to harbour doubts and suspicion about the Government’s honesty and at its most extreme it may have destroyed people’s trust in the Government forever.

Labour’s reputation has been further damaged by the ‘cash for peerages’ scandal. Our ethical foreign policy has been on dubious ground, particularly in light of the furore over the release of the Libyan Abdelbaset Ali al-Megrahi.’ Finally, the possibility that British security services have been complicit in the torture of terrorism suspects overseas raises questions about the promise of a new era of honest politics.

Whilst these are all very serious, all governments make mistakes which can have devastating effects. But what is the real problem with New Labour? The real problem with Labour is that there is an absence of leadership; and I am not referring to the leadership of Gordon Brown but to the abject failure of Labour MPs to lead. Despite the perception we are living in an era where backbench rebellions are at a post-war high.  When Labour MP’s had the opportunity to put a challenger forward for the leadership of the party they withered on the vine and failed spectacularly to offer the electorate or the party with a choice of candidates to succeed Tony Blair. Gordon Brown succeeded without being challenged; this was not Gordon’s fault!

It is little wonder that Labour MP Jon Cruddas recently expressed his dismay at how Labour seems to have meekly accepted the prospect of certain defeat, and to be doing next to nothing to prevent a Conservative government from walking into Downing Street. It is clear, Labour leaders are no longer leading!

Labour seems to have become paralysed by political inertia. In line with the theory of unripe time, nothing is done. My mentor, Charles Clarke showed great leadership and strength on the numerous occasions when he has stood out. However the resounding question is why didn’t he stand and why wasn’t there a proper contest?

It is worth noting that whilst Gordon Brown’s premiership seems to be characterised by a lack of leadership and purpose; remember; it takes more than one man to run a country and to deliver a message. In the spirit of collective responsibility, where Gordon is weak, his party and his cabinet should make him strong. The electorate’s trust in good government is becoming fatally undermined. In its hour of greatest need Labour needs to do something.

As anyone in business knows; perseverance and sheer grit is what’s needed when the going gets tough. The interesting thing is this; if all the members of the Government and all the Parliamentary Labour Party redoubled their efforts and worked for every vote, clarified their position on the economy, on health, on education and spoke in clear crystal tones – whilst they could still lose the general election – they would definitely give David Cameron a run for his money.

Maybe Gordon is a problem, but he definitely is not the whole problem.

Note to Editors:

Floyd Millen is the Director of the public affairs think tank yesMinister

  1. Floyd sits on the Council of the Hansard Society,
  2. Floyd sits on the SRB Board of the Economic and Social Research Council (ESRC).
  3. Mentored by the former Home Secretary RT Hon Charles Clarke MP
  4. Floyd is a former adviser to the Metropolitan Police Authority.
  5. Former council member of the Deaf Blind charity SENSE 2002-2006
  6. Obtained Masters Degree in Modern British Politics under the tutelage of the Conservative Peer Professor the Lord Norton of Louth.

To find out more information, visit www.yesminister.org.uk or www.floydmillen.co.uk

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