Focus on jobs, not benefits, to cut welfare bill, says thinktank

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Hitting government’s target of getting 80% of workers into jobs would reduce cost of universal credit by £10bn

Tackling the root causes of joblessness, instead of cutting benefits, is the best way to get the welfare bill down, and polling shows voters support that approach, according to research by the Joseph Rowntree Foundation.

In a forthcoming report, JRF economists show that hitting the government’s target of getting 80% of the working age population into jobs would cut the cost of universal credit by £10bn – an eighth of the current bill.

The research seeks to push back against the “dominant political narrative” that spending on social security is “spiralling”. Instead, it points out that official projections show spending on non-pensioner benefits “will remain flat, at around 5% of GDP for the remainder of the parliament”.

Sam Tims, JRF’s lead analyst, said: “We know what happens when the holes in the safety net are made ever bigger. The reasons people need support don’t disappear, instead low-income families go hungry.

“So government should focus on the root causes of economic insecurity. These are the underlying economic failures that drive social security need – like the decent jobs that need to be created, the affordable homes we need, and better health.”

A survey of more than 4,000 voters by the pollster More in Common, carried out alongside the JRF research, showed that when asked how the government should reduce the welfare bill, 59% supported the idea of reducing it in the longer term by tackling the underlying causes.

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That compared with 20% who opted for cutting costs quickly by restricting eligibility for benefits, and 8% for reducing how much claimants receive. Among those who voted Labour, LibDem or Green at the 2024 general election, 70% supported the longer-term approach.

The report contains calls for the government to prioritise measures such as increasing support for public health, building more social housing, and regenerating struggling regional economies.

The research shows that claims for health-related universal credit have risen more since the Covid pandemic in places where there are fewer jobs available locally, many of them former industrial or coastal areas.

It comes ahead of this week’s publication of the interim report from an inquiry into tackling young people not in education, employment or training (Neet) by Alan Milburn, the former cabinet minister who went on to chair the Social Mobility Commission.

Almost a million young people aged 16 to 24 are Neets. The former Labour minister has highlighted the fact that far more is spent on benefits for this group than on helping them into work.

He is expected to recommend benefits reforms when his final report is published later this year, but any call for cuts could prove controversial. Labour’s plan to reduce the personal independence payments received by disabled people was drastically scaled back last year, after a revolt by backbench MPs.

A DWP spokesperson said: “Reforming welfare is about getting people who can into work. Our investment in subsidised work, jobs grants, apprenticeships and training will support half a million young people.

“Putting the Right to Try into law is allowing people on sickness and disability benefits to try work without the immediate fear of losing their benefits, while our £3.5bn investment in employment support for sick and disabled people is giving them the genuine help they need to move into work and out of poverty.”

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