Benefits bill ‘virtually unchanged’ under coalition, says IFS

The biggest cuts to the welfare system are 'yet to come' says think tank

Most of the coalition’s reforms to the benefits system are yet to be delivered and it will fall to the next government to implement them, according to the Institute for Fiscal Studies (IFS).

The think tank said that although the coalition had reduced spending on benefits by £16.7 billion, because of weak growth in wages, spiralling private rents and an ageing population the overall £220 billion bill was “virtually unchanged”.

Welfare reform had been a case of “evolution rather than revolution” and the most significant cuts were “yet to come”, the IFS added.

The think tank warned that the next government would face “difficult decisions” as to whether to cut the state pension or reduce the amount of child benefit paid to middle-income families.

And it said that “most of the major structural changes [to the benefits system], such as universal credit, have run into problems, and are yet to be delivered”.

Labour’s shadow work and pensions secretary Rachel Reeves MP said the report confirmed “that you can’t control welfare spending without tackling its root causes in low pay and rising rents”.

“Only Labour has a plan to tackle the cost-of-living crisis and low pay as part of our tough but balanced plan to get the deficit down, control welfare spending and earn our way to higher living standards for all, not just a few at the top. A Labour government will raise the National Minimum Wage to £8 an hour, bring in Make Work Pay contracts to ensure more people are paid a Living Wage, get more homes built and extend free childcare provision and will get the next generation into work with a Compulsory Jobs Guarantee.”

Like this article? Sign up to Left Foot Forward's weekday email for the latest progressive news and comment - and support campaigning journalism by making a donation today.

2 Responses to “Benefits bill ‘virtually unchanged’ under coalition, says IFS”

  1. Leon Wolfeson

    Oh what a surprise, they haven’t saved money by slashing benefits, so they’ll slash benefits harder so they won’t save money, but create even more poverty. And you’re going to do the same thing.

    Labour have promised next to nothing – a low cap on the minimum wage, contracts which will be basically ignored, a low house building target without council homes involved and forced labour which creates strong incentives for companies to keep unemployment high and will lower wages.

    Nothing about oh…rent caps. About restructuring the energy market completely. About spending a few billion on cracking down on tax evasion. About taxing capital properly. About a basic income…now THOSE would work.

    Nope, it’s all about slashing welfare spending, “controlling” people by lowering benefits, under the benefit cap which will ensure large cuts on top of the existing below-inflation rises in what were already illegally poorly paying benefits.

  2. littleoddsandpieces

    Can bloggers help The Greens please.

    I am not a member of any party, just a voter faced with the flat rate pension that gives nil state pension even after decades of paying National Insurance, after suffering the loss of payout at 60 for 6 years. If the retirement age was to be raised, the only just way would have been to tell someone at 18, not in their late 50s.

    Disabled and chronic sick and the TUC agree that someone over 60 not well and incontinent, is hardly likely to find work.

    So with nil of those benefits, there is no chance in my applying for Jobseekers Allowance, with Jobcentres demanding hours long sign-on each day but denying the right to visit a toilet, a right in law for all alleged criminals under police station interrogation. I would be sitting in a puddle.

    The Greens did have a policy of the Citizen (basic) Income, but upon being interviewed on BBC Radio 4’s Today Programme, Ms Caroline Lucas MP admitted that they did not have the resources to properly cost that policy, that would cost about £280 billion, so that policy has been lost.

    By that, I assume now that The Greens are the sole party that had provided me with a state pension, now totally lost by the flat rate pension, by their policy of:

    – Full Citizen State Pension, without any conditionality of National Insurance record.

    The Tories say that the welfare bill has remained constant in their parliament at £220 billion a year.

    If the entire benefits admin was shut down tomorrow, that £220 billion would pay for the £280 billion Citizen Income.

    The Citizen Income would pour into local community shops and businesses, as the poor up to average waged spend all their money because they have to. Only the wealthy can hoard money.

    And 75 per cent of all tax to government comes from stealth taxes and VAT embedded in much of our every day lives, even food.

    Only 25p in the pound comes from income tax.

    Austerity has never happened as the cost of benefits admin has risen, whilst the money to the starving has decreased year on year, getting closer to closer to pre 1948 welfare state levels.

    The Jobcentres go digital in March, so redundancy is not a cost for shutting all 750 Jobcentres from May, after the general election.

    Having a secure £72 per week income, without any conditionality, automatic and universal, is far cheaper in admin, with nil fraud after all, and ends all this incitement to hatred to the poor, in or out of work (97 per cent of benefits bill is to the working poor and poor pensioners).

    All the admin both state and private in welfare could be gone, especially the huge management and IT costs (with Universal Credit’s IT said to cost upwards of £20 billion), then The Greens (or any other socialist party) would hve the means to pay the Citizen Income and the Citizen State Penson.

    The Tories say they have a £30 billion windfall from lessing of national debt interest. There is £30 billion surplus in the National Insurance Fund from 2013 (source House of Lords Library) that is in fact the

    non paid out state pension to women turning 60 in 2013. Men’s retirement age only raised one yar from 65 to 66 in 2013, whereas women (and therefore the couple) lost 6 years payout from 2013.

    The Citizen Income and Citizen State Pension, without conditionality, universal and automatic, would gain well over 15 million votes, which is the number of non-voters in 2010 general election, that was double the amount of voters for all parties put together.

    The Greens say:

    However speaking on BBC Radio 4’s Today Programme, Ms Lucas …“The citizens’ income is not going to be in the 2015 general election manifesto as something to be introduced on May 8th. …it’s not going to be in the 2015 election manifesto.”… effectively kills off the policy in the election campaign.

    During the rest of the interview, Ms Lucas …saying it is a “small party with a shoestring staff”.

    Unions have given Labour £1.5 million and yet campaign against benefit cuts that are the direct cause of starvation (denied by government obviously).

    If unions will not give The Greens money for the bulk of people going to foodbanks, the working poor and low income self employed, as well as the unemployed, disabled and chronic sick of all ages, then perhaps unions and economists can combine to help The Greens fully cost the Citizen Income and Citizen State Pension.

    The Citizen State Pension could have had the potential of being £113.10 plus the mis-sold opt out from SERPs that could have given around £165 (?) per week after the current 30 years NI record (going up to 35 years from 2016, so discrimination against mothers).

    Far above the flat rate of £155 which not even half of new claimants will get. The poorer you are, the less likely you will get any state pension from the flat rate.

    Neither is the flat rate, anything like single tier, as admitted by the DWP, who say that individuals will get all different rates of state pension, from complex calculations, for decades to come.

    If a party grants:

    – £72 per week automatic and universal Citizen Income.

    – Rent caps even in London for social housing.

    – All councils made single council counties or cities, so halve the council tax for all.

    – Equal Citizen State Pension for men and women aged 60-66 in 2015 and older at the full rate of around £278.10 (made up of £113.10 state pension plus whatever the full non-opted out SERPs rate).

    Then indeed the recession would be over.

    As all that money would pour into the high street, as the bulk of the population are low income to low average waged, and this would generate youth jobs.

    So help The Greens, or any other socialist party, to have a SYRIZA like landslide victory in May.

    A huge number of men and women’s lives depend upon it, from babes yet born to grannies.


Leave a Reply