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Why didn’t someone think of this ‘welfare reform’ earlier?

October 6, 2010 by Joshua Chambers   Comments (0)

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Apparently, Iain Duncan Smith is a visionary! Rise up for the quiet man, and stamp and hoot and applaud! Let his silence be a contrast to the universal acclaim he's greeted with, for he has … outlined something that sounds rather simple but not yet joined the dots?

Does anyone fully understand the coalition's plans for welfare reform? Why did George Osborne say they would save £4bn, IDS say he would require £3.5bn extra funding, and yet now the papers are reporting that overall £9bn will be saved?
 
Spin is one answer, and another is that the plans are as yet untested and are yet to be fully unveiled. Like a tangled ball of wool, if you pull on one strand you'll think you can see where the knot is, but approach it by tugging at a different thread and you’ll suddenly find yourself confused.
 
What we do know is that there is to be a single 'work programme', and that all those complex schemes and structures in place will be simplified. So, if you're unemployed, have young children, live in council housing, and also have a disability, you will no longer have to apply for separate benefits, you can receive them all together - and receive a bonus if you actively seek employment.
 
Now this sounds like a good idea - it's seductive to left and right alike - but it seems odd that simplifying the system could save money. The problem is that of administration, as it always has been with benefit reform.
 
In the short term, simplifying the system will need a lot of manpower – to operate the old system while it's still in existence and manage the introduction of the new system too. This is while the department that manages benefits will be trying to reduce their staff numbers. Something doesn't quite add up there.
 
The bluster surrounding the announcements imply that Labour did nothing to the tackle the problems. Talk to any Labour welfare minister and they'll admit there have been mistakes, and that they were too slow to act. I've spoken to two in the last few months who said they wished they'd started to reform things harder, and sooner.

But they did try to simplify some parts of the system, and also to get people who have been stuck on Incapacity Benefit for years back into the workplace. Now, not all of it was simplified because of political reasoning: by creating a complex system that no-one could understand, Gordon Brown could redistribute wealth from rich to poor without the press picking up on it.
 
But Margaret Thatcher also relied on the opacity of the system, in her case to reduce unemployment figures. In the short term, what you'll see from the new scheme is people who didn't count as being unemployed suddenly appearing on the official figures. Unemployment will go up and the government will get criticised.
 
If they want to face that, then there are the problems faced by Labour. A key one is assessing people to prove that they're able to work. This requires a medical checkup, currently provided only by one contractor. They struggled to meet targets set by the Labour government but the new government are aiming to get them to assess even more people in a smaller space of time.
 
If the contractors can't come up to scratch, there is another way. GPs could come in from the NHS, but imagine the headlines then: NHS doctors stop treating the sick to catch benefit offenders. The quiet man would be wise not to turn up the contrast just yet, and continue to enjoy the acclaim while it lasts.