Tuesday, August 18, 2009

New Thinking Needed on Benefits State

Today, the think-tank Policy Exchange calculates that nearly 6 million Britons are on some form of benefit:
  • 1.58 million on Jobseeker's Allowance

  • 2.6 million on incapacity benefit and the new Employment and Support Allowance

  • 736,000 on lone parents' benefits

  • 400,000 on carers' benefits

  • 363,000 on disability benefits

  • 182,000 on other income-related benefits

  • 95,000 on bereavement benefits

The real story is not so much the scale of the benefits state, but that the government makes it so difficult to get off them. People are rational, and it is not worth getting a job or a promotion if your allowances drop or if you are on a penal rate of taxation as a result. This logic applies especially when a range of benfits are means-tested. Why acquire more means when the test will just take them away? Labour's Britain is broken. It will take a long time to untangle this mess.

No comments:

Post a Comment