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Regional rates of benefits considered by David Cameron | Regional rates of benefits considered by David Cameron |
(40 minutes later) | |
David Cameron is considering bringing in regional rates of benefits, as part of a "wider debate" about welfare. | David Cameron is considering bringing in regional rates of benefits, as part of a "wider debate" about welfare. |
No 10 says the prime minister wants to look at whether "it makes sense" to set benefits at a national level, given differing regional pay levels. | No 10 says the prime minister wants to look at whether "it makes sense" to set benefits at a national level, given differing regional pay levels. |
In a speech the PM also raised the idea of cutting housing benefits for under-25s to "stop the state dragging young people into dependency". | |
He urged a debate on ideas which may feature in the next Tory manifesto. | |
But he said he also hoped that his coalition government partners, the Lib Dems, might agree with some of the ideas so they could be brought in before the next election, which is due in 2015. | |
Mr Cameron's speech is being seen as an attempt to reconnect with disgruntled Tory backbenchers who have accused him of allowing the Liberal Democrats to water down traditional party values. | Mr Cameron's speech is being seen as an attempt to reconnect with disgruntled Tory backbenchers who have accused him of allowing the Liberal Democrats to water down traditional party values. |
Regional rates of benefits - which would presumably see people in more affluent regions getting higher payments than in poorer regions - would be likely to prove controversial. | |
No 10 stressed that no decision had been taken, and it is thought that regionally-based payments would only apply to working-age benefits. | No 10 stressed that no decision had been taken, and it is thought that regionally-based payments would only apply to working-age benefits. |
'Devastating impact' | 'Devastating impact' |
In his speech in Kent Mr Cameron defended benefits for the elderly and disabled but said the system of working-age benefits had gone "truly awry" and created a "welfare gap between those living long-term in the welfare system and those outside it". | |
"Those within it grow up with a series of expectations: you can have a home of your own, the state will support you whatever decisions you make, you will always be able to take out no matter what you put in. | |
"This has sent out some incredibly damaging signals. That it pays not to work. That you are owed something for nothing. It gave us millions of working-age people sitting at home on benefits even before the recession hit. It created a culture of entitlement. | |
"And it has led to huge resentment amongst those who pay into the system, because they feel that what they're having to work hard for, others are getting without having to put in the effort," he said. | |
He said the housing benefit system for people under 25 encouraged young people to "grab" their independence through the the benefit system rather than earn it. | |
"For literally millions, the passage to independence is several years living in their childhood bedroom as they save up to move out while for many others, it's a trip to the council where they can get housing benefit at 18 or 19 - even if they're not actively seeking work, " he argued. | |
David Cameron is not just calling for a minor tweak to the welfare state - he is opening the door to a re-casting of the entire welfare system and who it is meant to serve. | David Cameron is not just calling for a minor tweak to the welfare state - he is opening the door to a re-casting of the entire welfare system and who it is meant to serve. |
"The time has come to go back to first principles," he says. | "The time has come to go back to first principles," he says. |
If the welfare state is meant to be a safety net, he argues, then a lot of people are receiving benefits who are not in need, and therefore should not be receiving them. | If the welfare state is meant to be a safety net, he argues, then a lot of people are receiving benefits who are not in need, and therefore should not be receiving them. |
Hence he raises the prospect of limits to the amount of support claimants should expect for larger families; curbs to the rights of young people to get help with their rent; and tougher requirements on those seeking work. | Hence he raises the prospect of limits to the amount of support claimants should expect for larger families; curbs to the rights of young people to get help with their rent; and tougher requirements on those seeking work. |
It is a bold statement of intent that will reassure and please an unsettled Tory party, both inside and outside Parliament. | It is a bold statement of intent that will reassure and please an unsettled Tory party, both inside and outside Parliament. |
But it carries with it a huge political danger? It risks undermining what was Mr Cameron core pitch to the electorate, namely that he was a different sort of Tory leader. | But it carries with it a huge political danger? It risks undermining what was Mr Cameron core pitch to the electorate, namely that he was a different sort of Tory leader. |
His critics will seize on this -together with the apparent playing down of the green agenda and wobbles over gay marriage - as further evidence that Mr Cameron is turning his back on Compassionate Conservatism and returning to a much more traditional Tory agenda. | His critics will seize on this -together with the apparent playing down of the green agenda and wobbles over gay marriage - as further evidence that Mr Cameron is turning his back on Compassionate Conservatism and returning to a much more traditional Tory agenda. |
Mr Cameron also suggested introducing new curbs on the jobseekers' allowance, including linking the up-rating of benefits to wages - instead of the rate of inflation - when pay is not rising as much. | |
Time limits on those who have been out of work for a number of years should also be considered, Mr Cameron said. | |
He said it was necessary to look at the "interaction of the benefit system with the choices people make about having a family", arguing the welfare system encouraged working-age people to have children but not work, making taxpayers resentful. | |
His idea to scrap housing benefit for people aged under 25 would save almost £2bn a year, but housing charity Shelter fears the consequences of such a move. | His idea to scrap housing benefit for people aged under 25 would save almost £2bn a year, but housing charity Shelter fears the consequences of such a move. |
Chief executive Campbell Robb said: "To take away housing benefit from hundreds of thousands of young people - particularly in the current economic environment where young people in particular are finding it very difficult to find jobs - would have a devastating impact on many people's lives. | Chief executive Campbell Robb said: "To take away housing benefit from hundreds of thousands of young people - particularly in the current economic environment where young people in particular are finding it very difficult to find jobs - would have a devastating impact on many people's lives. |
"I think we would see many more people ending up homeless as a result of this kind of very significant change." | "I think we would see many more people ending up homeless as a result of this kind of very significant change." |
Ahead of the speech Labour's Liam Byrne said the prime minister was "coming at it from the wrong approach for the long-term". | |
"First we need stronger action to help people get back into work so Labour has said 'Let's put in place a jobs guarantee for young people'. We're starting a debate about how childcare and social care could actually help people work the hours that are on offer," he said. | "First we need stronger action to help people get back into work so Labour has said 'Let's put in place a jobs guarantee for young people'. We're starting a debate about how childcare and social care could actually help people work the hours that are on offer," he said. |
In March, the government's Welfare Reform Act received Royal Assent. That act - which applies to England, Scotland and Wales - introduces an annual cap on benefits and overhauls many welfare payments. | In March, the government's Welfare Reform Act received Royal Assent. That act - which applies to England, Scotland and Wales - introduces an annual cap on benefits and overhauls many welfare payments. |
Lib Dem Chief Secretary to the Treasury Danny Alexander told BBC One's Sunday Politics show that Mr Cameron was free to set out his own thinking but that the coalition had already brought in radical welfare reform, which should be allowed to "bed-in" and warned against "repeating the mistakes of the 1980s". | |
Chancellor George Osborne indicated in his March Budget that the welfare bill should be cut by another £10bn between 2015 - the expected year of the next election - and 2017. That is on top of the £18bn of cuts during the current parliament. | Chancellor George Osborne indicated in his March Budget that the welfare bill should be cut by another £10bn between 2015 - the expected year of the next election - and 2017. That is on top of the £18bn of cuts during the current parliament. |
Are you in receipt of benefits? Are you concerned about possible benefit changes? Please send us your comments using the form below. | Are you in receipt of benefits? Are you concerned about possible benefit changes? Please send us your comments using the form below. |