Measures to boost labor force participation will target the over-50s, the long-term ill and disabled, as well as benefit claimants in the chancellor’s forthcoming budget.
Tackling economic inactivity is a key component of Jeremy Hunt’s plans as job numbers have fallen far below pre-pandemic levels, damaging Britain’s already struggling economy.
With this plan, we can tackle labor shortages, reduce inflation and put the UK back on the path to growth.
Jeremy Hunt
Mr Hunt will announce on Wednesday the scrapping of the system used to assess eligibility for sickness benefit, as part of his ‘work budget’.
The biggest reform to the welfare system in a decade means claimants can continue to receive payments after returning to work, the Treasury said.
The change allows them to transition without fear of reevaluation and loss of benefits.
The process is expected to be replaced by one that asks applicants to demonstrate what jobs they can take, with disability equality charity Scope warning that “disabled people should not be forced into unsuitable work”.
The chancellor will also set out plans to encourage over-50s to return to work by expanding skills training.
The Resolution Foundation, a think tank, recently said that while three-quarters of economic inactivity – an increase of 830,000 between 2019 and 2022 – is concentrated among those aged 50 and over, efforts to “retire” pandemic pensioners are unlikely to succeed. .
Mr Hunt details the overhaul of the Universal Credit system, which aims to encourage applicants to move into work or work more hours.
The chancellor is under pressure to act after childcare was found to be the most expensive in the world.
It will announce a rise of several hundred pounds to the top Universal Credit benefit, which has been frozen at £646 a month per child for many years, the Treasury said, without specifying the exact amount.
The government will also start paying parents the Universal Childcare Credit benefit in advance rather than in advance. This will help those who are struggling to get a job or go into debt under the current system due to sky high costs.
Other measures include:
– Strict requirements for applicants who care for children to hunt for work or get more hours.
– The minimum income threshold should be increased to avoid regular meetings with a job coach from 15 to 18 hours per week. Now the partner of the working person will also have to look for a job.
– An increase in the Universal Credit borrower’s income limit, according to which they must regularly meet with an alternative work coach for 15 to 18 hours a week. Partners of working people will also have to look for work.
– Increasing sanctions for applicants who do not seek or obtain employment.
Mr Hunt said: “For many people there are barriers to employment – lack of skills, a disability or health condition, or not being in the job market for a long time.
“I want this jobs budget to break down those barriers and help people find jobs that suit them.
“We need to address skills gaps and give people the skills, support and incentives they need to get into work. With this plan, we can tackle labor shortages, reduce inflation and put Britain back on the path to growth.”
As firms struggle to fill the more than one million job vacancies in the economy, it’s good to see the Government looking for ways to get people back into work.
CBI officer Seema Kullasi-Aldridge
With more than half a million workers missing from the UK workforce since the start of Covid, Prime Minister Rishi Sunak has instructed the Work and Pensions Secretary, Mel Stride, to look at the issues holding back labor force participation in the autumn.
Its conclusions should be published in a white paper on budget day.
Seema Kullasi-Aldridge, Chief Campaigns Officer at the Confederation of British Industry, said: “As firms struggle to fill the more than one million vacant jobs in the economy, it’s good to see the Government finding ways to support people back into work.”
She said it was “absolutely right” that childcare benefit under Universal Credit should be paid up front, but called for a review of childcare “to make sure it works for everyone”, as well as reform of bursaries to help the over-50s. returns to work.
The TUC said changes such as greater support for childcare were “long overdue” and welcomed “an end to assessments that cause anxiety rather than help people achieve their aspirations”.
But the union’s general secretary, Paul Novak, said the proposals to increase the use of sanctions were “disturbing”.
James Taylor, director of strategy at Scope, said scrapping work capacity assessments was “the minimum change needed to start improving a welfare system that consistently fails disabled people”.
He added: “To be successful, these proposals must lead to a person-centred system that is tailored to the specialist and provides flexible work support.
“Those who want to work should be supported. But for some, this is impossible, and disabled people should not be forced into unsuitable work.
Labour’s shadow work and pensions secretary, Jonathan Ashworth, said: “In recent months Labor has highlighted welfare reforms to get Britain back to work and now the Tories are following our lead.”
