DWP announces huge new £240m reforms to boost jobs and cut benefits bill

A huge new shake-up has been announced by the Labour Government to boost jobs and cut Britain's "bulging" benefits bill. The Department for Work and Pensions has unveiled planned legislation with the "biggest reforms to employment support for a generation" backed by £240 million investment.

Work and Pensions Secretary Liz Kendall has today published the Get Britain Working White Paper, marking the Government's first major move to achieve an ambitious 80 per cent employment rate. The tough new measures to get more people off benefits and into work comes as figures show almost 1.5 million people are unemployed, more than nine million people are economically inactive and a record 2.8 million people are out of work due to long-term sickness. Millions of adults are lacking the essential skills needed to make progress at work, Labour says.

The stark statistics show that young people have also been left behind, with one in eight not in education, employment, or training. Many end up going straight onto benefits after they leave school, with the latest figures from the DWP showing there are 542,000 people aged 16 to 24 who are claiming Universal Credit but are not working, compared with just 182,000 in the same age group who do have jobs.

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The UK is the only major economy that has seen its employment rate fall over the last five years and Ms Kendall says this is largely driven by "a significant rise in the number of people out of work due to long-term ill-health with an outdated employment support system which is ill-equipped to respond to this growing challenge."

The new moves include revamping the "outdated Jobcentre system" into a new national jobs and careers service focused on people's skills and careers instead of just monitoring and managing benefit claims. Mayors and councils will be given the power to combine local work, health, and skills support to meet the specific needs of their areas.

The government is also delivering a new Youth Guarantee so every young person has access to education or training to help them find a job. It is also transforming the Apprenticeship Levy in England into a more flexible Growth and Skills Levy backed by £40 million to expand opportunities for young people to develop skills and get into work.

An independent review will also be launched into how employers can be better supported to take on people with disabilities and health conditions and keep them in the workplace. Labour says this will "ensure that more people can benefit from a sense of dignity, purpose and financial independence."

Following today's announcement, new measures to overhaul the health and disability benefits system are expected to be published next spring. As part of this, the work capability assessment used by the DWP to determine whether someone is fit for employment - or instead gets incapacity payments on top of their Universal Credit - is expected to be replaced or revamped.

The Secretary of State for Work and Pensions, Liz Kendall, said: "To get Britain growing, we need to get Britain working again. Our reforms will break down barriers to opportunity, help people to get into work and on at work, allow local leaders to boost jobs and growth, and give our children and young people the best opportunities to get on in life.

“The Get Britain Working White Paper shows that this Government stands unashamedly for work. We will make sure everyone, regardless of their background, age, ethnicity, health, disability or postcode can benefit from the dignity and purpose work can bring. We can build a healthier, wealthier nation – driving up employment and opportunity, skills and productivity – while driving down the benefits bill."

She said the reforms "will be underlined by the principle that people who can work will be expected to work, with clear consequences if they don’t properly engage." Campaigners have urged the government to put less focus on sanctions that would "ramp up misery" by cutting people's low incomes even further.

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