Most of the publicity this morning was given to the decision of George Osborne to stop paying Child Benefit to higher rate taxpayers. Indeed I am due to be interviewed just after 8pm tonight on this subjct on the BBC News channel.
But another significant reform announced in George Osborne's speech was this:
So I can announce today that for the first time we will introduce a limit on the total amount of benefits any one family can receive.
And the limit will be set according to this very simple principle: Unless they have disabilities to cope with, no family should get more from living on benefits than the average family gets from going out to work.
No more open ended chequebook.
A maximum limit on benefits for those out of work.
Set at the level that the average working family earns.
Money to families who need it – but not more money than families who go out to work.
That is what the British people mean by fair – and we will be the first Government in history to bring it about.
I am not sure how many people this could potentially affect. It could also be difficult to administer. However it does send out a signal. It is reminiscent of the Clinton reform package which included a limit on the number of years during which people could live on welfare benefits.
Another change that has been announced but not discussed a great deal is the change in the requirement on lone parents to seek work when their youngest child reaches a given age. It is to be reduced this month from 10 to 7. The Labour government made a first reduction (from 16?) and now there has been a further reduction. These reductions are of great importance because they assert to lone parents that having a child is not a ticket to living at the expense of others for 16 years.
I think that in the USA a lone parent is obliged to seek work when his or her child is aged three months.
This sort of measure does not attract huge attention, perhaps because most reporters do not really follow welfare and do not see its significance. They can grasp Child Benefit but actually that is probably a reform that will have very little effect on the shape of British society. Reducing the vast numbers on welfare benefits could have a far more profound effect.
Postscript. The following is from the Spectator blog:
...this benefit cap is probably more about politics than public finances. It will be set around £500 a week and, according to the numbers being put around by his team, will affect only 50,000 families, if not fewer. For some, apparently, that could mean losses of £300 a week – but I imagine the majority of savings will be far more modest than that.
Posted by James Bartholomew • Indexed in Reform • Welfare benefits
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"I think that in the USA a lone parent is obliged to seek work when his or her child is aged three months."
In the US the maximum period a single parent can be exempted from work requirements is 12 months. The period allowed varies at state option.
Posted by: Lindsay Mitchell at October 5, 2010 08:28 PM
This is a step in the right direction. Also gladdening is the Culture Secretary's announcement today. The Spectator quote above does not acknowledge the (potentially) very, very profound effect on British noted by the author of this blog.
Of course, it remains to be seen whether the principle of responsibility will be applied to "families" outside this initially affected cohort of 50,000 or so. The Spectator is correct in implying that these are a drop in the problem ocean: a start, nevertheless.
Does the move go far enough? We may also ask why a benefit-dependant household should have an income even equal to that of a wage-earning one, never mind in excess of such.
The question is; will anyone have the courage to deny Danegeld to the entitled hordes. Doing so may, perhaps, necessitate employment for our troops in what we may call the Home Theatre.
These could be interesting times.
Posted by: Sparky at October 7, 2010 09:46 AM
Once the single parent is obliged to claim JSA they simply claim ESA (or have another child).
Of course, Gingerbread, will say single parents "would love to work", yet the numbers on benefits keep going up.
Posted by: Anon at October 14, 2010 05:47 PM
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I have just heard you on Nicky Campbell. You said what will happen to the houses in central London when people on benefits have to go to cheaper areas. There are thousand of hardworking single's and couples who would love to live nearer to their work. My daughter is in the public sector working in central London paying £2000 a year out of her £18000 on fares. Look at the retail sector these workers would gladly pay fair rents to be able to enhance their lives. Why are there blocks of council flats by Waterloo full of asylum seekers, contributing nothing to the wealth of London. There were 5 of us in 2 rooms in Shepherds Bush, we had to move out of the area when we were at school to rent a house with 3 bedrooms, my father was a railwyman for 40 years but we couldn't stay where we wanted.
Posted by: joan costard at October 5, 2010 10:02 AM