Cameron calls benefits system ‘unaffordable’

The benefits system is unaffordable, traps people in poverty and encourages irresponsibility, according to the Prime Minister. In a speech on welfare he called for a debate about the fundamental purpose of the benefits system, and put forward a wide range of possible reforms.

David Cameron was speaking in his capacity as leader of the Conservative Party, rather than on behalf of the government. He said the government has made a ‘good start’ on reform but he signalled the need for further radical measures at some stage in the future, probably after the next election. Key possibilities for reform include:

  • Removing access to housing benefit for anyone between the ages of 16 and 24.
  • Banning anyone earning above £60,000 a year from access to a council house tenancy.
  • Breaking the link between benefits and inflation.
  • Time-limiting benefits by reducing their levels if someone is out of work for longer periods.
  • Imposing a new specific cap on housing benefit so that it is worth no more at current prices than £20,000 a year.
  • Restricting income support and possibly child benefit to single mothers if they have three or more children.
  • Requiring benefit claimants to gain basic literacy and numeracy skills.
  • Requiring anyone on employment and support allowance to improve their medical condition in return for benefits.
  • Requiring lone parents on income support with children as young as three to prepare for work by attending job centres.
  • Allowing higher-level benefits for those who have contributed tax and national insurance for many years.
  • Banning school leavers from going straight onto benefit.
  • Preventing the payment of non-contributory benefits to people who do not live in the country.
  • Paying more welfare benefits in kind, such as free school meals rather than cash.

An earlier draft of the speech also contained a proposal to introduce regional benefit levels but this was removed from the text at a late stage. Reaction from commentators was generally hostile, particularly over the removal of housing benefit from young people. Barnardos and Shelter both called it ‘outrageous’ and Centrepoint warned of ‘catastrophic consequences’. The Child Poverty Action Group said the speech ‘leaves in tatters the PM’s pledge to be the most family friendly government’.

Source: Speech by David Cameron MP (Prime Minister), 25 June 2012
LinksSpeech | Conservative Party press release | Barnardos press release | Shelter press release | Centrepoint press release | CPAG press release | Guardian report