Benefits: Revive 'principle of contribution' says Labour


Labour Deputy Leader Harriet Harman says growth in the economy needs to be addressed as part of welfare reform

Labour wants to "strengthen the old principle of contribution" in the benefits system, the shadow work and pensions secretary says.

Many people "feel they pay an awful lot more in than they ever get back", Liam Byrne wrote in the Observer.

He also said "people who work and contribute to their community" should get priority in social housing.

He criticised recent tax and welfare changes, but David Cameron told the Sun the moves were about "fairness".

In his article, Mr Byrne criticised the coalition for failing to support "working families and those in real need", insisting that Labour's approach to reforming welfare would be "very different".

Change needed

"Instead of seeking to divide people, we want to ensure everyone plays their part so we can rebuild Britain together," he said.

He continued: "There are lots of people right now who feel they pay an awful lot more in than they ever get back. That should change.

"We should start by letting councils give priority in social housing allocations to those who work and contribute to their community."

BBC political correspondent Carole Walker said Labour had been under pressure to say what it would do to overhaul the welfare system, after criticising government policies.


Will changes to benefits be a key issue at the next general election? We may be two years away from a national poll but some politicians are already mentioning the year 2015.

Today Labour was outlining its ideas on reforms in one newspaper as the prime minister was hailing his in another.

Opposition parties are normally cautious of revealing too many policies before the campaign proper begins.

Comments by the chancellor in the wake of the Philpott case may have raised the temperature of the debate, but the welfare bill is about £200bn and is a significant part of the government spend.

As long as the country's finances remain under pressure, so too will anyone tackling the welfare question.

The party's deputy leader, Harriet Harman, said it was "not surprising" people were concerned about the welfare system and defended Labour's record on welfare reform.

She said the party was looking at wider changes based on the contributory principle as part of its policy review.

She told the BBC's Andrew Marr Show: "We're also, ahead of the general election, putting forward three principles.

"One, that work should pay; secondly, that there should be an obligation to take work; and thirdly, that there should be support through a contributory principle for people putting into the system as well as taking out.

"I think that's the discussion and the debate we're engaging in up to the general election."

She said the results of the review would "come to fruition" in Labour's next manifesto.

Last week, Mr Byrne told the BBC he was looking at helping two groups in particular - working parents and those who are unemployed and over 50.

He said there were many women who had paid into the system but who then did not receive help with childcare to allow them to go back to work.

For those looking for work over the age of 50, he said although some may have paid up to £60,000 more in national insurance than they get out, they were not receiving any extra help to get back into work.

The case of unemployed Mick Philpott, jailed last week for the manslaughter of six of his children in a fire, has led some politicians to comment on whether the state should subsidise large families.

Mr Philpott, who had 17 children, received thousands of pounds a year in child benefit, as well as the income support and wages paid to his wife and mistress.

'Support children'

Asked if there should be a cap on the number of children the state would support through benefits, Ms Harman said: "I don't think that the state should be dictating family size but I do think that the state should support children."

"Rather than trying to encourage women to have children or discourage them from having children, I think it's important to actually support children who are born into a family. But also to make sure women and men are in a position to make proper choices about their families."

Income tax changes

The changes to income tax coming into effect on 6 April include:

  • A cut in tax rate from 50% to 45% for those earning more than £150,000
  • The 40% tax rate now starts at an income of £41,450. Previously it was £42,475
  • An increase in the tax-free personal allowance to £9,440, from £8,105
  • The amount of tax-free income pensioners can earn remaining frozen at £10,500

Meanwhile, Mr Cameron told the Sun the welfare system had lost its way and benefits had become a "lifestyle choice" for some - causing resentment.

He insisted it was "crazy" certain claimants could have a bigger income on benefits than if they had a job.

"So this month we are making some big changes," he added.

"They are changes that have a simple principle at their heart: we are restoring the fairness that should lie at the very heart of our tax and welfare systems."

This week, a series of changes to benefits and taxes have come into force.

Most tax credits and working age benefits are being increased by 1% - below the rate of inflation - while pensioners are getting a larger rise in the state pension, which is going up by 2.5% to £110 a week.

On Saturday, the personal allowance - which is the amount that most people can earn before they pay income tax - rose to £9,440.

And the top rate of income tax was also reduced from 50p in the pound to 45p for people with incomes of more than £150,000.

Also from 6 April, the amount pensioners can earn without paying tax will no longer rise with inflation, giving rise to accusations of a "granny tax".


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  • rate this

    Comment number 257.

    I wish the government would do something genuine to help people into work, instead of the constant miserable propaganda that unemployment is a "lifestyle choice". I am sure all the people who were made redundant as their company has cut jobs this week are really happy at being told its a lifestyle choice and they just need to work harder!

  • rate this

    Comment number 256.

    As Peter Hitchens pointed out on Any Questions yesterday, the main parties use, and will continue to use, the benefits system to buy votes.

    Since the main welfare costs are housing benefits and working tax credits, UK business and government are the BENEFICIARIES of a dependent welfare state! This is what capitalism requires; in the words of Norman Lamont, unemployment is a price worth paying!

  • rate this

    Comment number 255.


    From its abuse by too many, the moral authority of age & experience has been overturned. Whereas a father or teacher or leader would in the past have silenced squabbling, to declare that all would share the meal, all could support life however late their vineyard hire, that equal shares were to be lost (by laziness or crime) NOT have to be fought for, NOW we re-learn in bitterest experience

  • rate this

    Comment number 254.

    76. alistair

    '...What you get out should be based on need, not your ability to pay in...'

    I have 'need' of a chauffeur driven rolls royce, I have no ability to pay however. Can I have one, or I will throw my toys out of the pram if you refuse.

  • rate this

    Comment number 253.

    I'm 42 & have worked every day since I was 16. I've never claimed any benefits; when I was made redundant I took temp jobs at half my previous salary. I've never taken maternity leave. When I retire at whatever age they finally raise retirement to, I'll get a weekly allowance that may just keep me fed and warm. It would be nice to get something back before I'm too old to enjoy it.

  • rate this

    Comment number 252.

    So many people know exactly what we should be doing ( even though they contradict each other ). I'm surprised they're not running the country.

    Though perhaps in their own minds they are ...

  • rate this

    Comment number 251.

    The largest and fastest growing parts of the Welfare Bill are State Pension and Housing Benefit.
    Possible solution:
    State Pension - introduce a comprehensive means tested system to measure pensioners wealth (savings, property portfolio, shares etc.) and pay state pension ONLY to those who really need it.
    Housing Benefit - introduce a rent cap on all properties used for social housing.

  • rate this

    Comment number 250.

    There should be a basic benefit of 50% of the average wage with further benefits for those who are suffering from any illness or disability. That way the slivers would be encouraged to find work.

  • rate this

    Comment number 249.

    I'm on benefits to, i don't want to be.
    but there is no help out there for you, i'm on the work programme which is a waste of space they make me feel like a car, the amount of time I've bee n parked. i have health issues lupus and cancer, and i cant drive, which is what employers are asking for in my area... what am i supposed to do?

  • rate this

    Comment number 248.

    Limiting the number of children for which benefits are paid, would bring abusers in line with other normal families, if there something you can't afford, you just don't do it.
    Many have openly said they see kids as a way to get easy benefits and climb up the priority list. Having kids should not be an incentive.
    Kids conceived for this reason are not growing up in the best environment either.

  • rate this

    Comment number 247.

    I cannot understand why successive governments have totally failed to get a grip on welfare payments. It is simple to differentiate the truly needy from those abusing the system. Of course, what can one expect when those in government are equally to blame for milking the system to their own and friends advantage and, similarly, those in parliament totally fail to monitor the government.

  • rate this

    Comment number 246.

    161 "I see the ubiquitous, welfare hysterical contributors... criminalising the poor.." Ignoring your very weak grasp of the meaning of criminalise, the only ubiquitious hysteria I see if the disgusting emotional hyperbole, used by the left to justify by votes with other people's money. Benefit payments are still going up don't forget.

    18 GO say everyone was like Philpott, although many are.

  • Comment number 245.

    All this user's posts have been removed.Why?

  • rate this

    Comment number 244.

    199. David
    If you can talk on a mobile phone and operate a lap top or PC you can work in todays society. We do not live in an age of only physical manual jobs anymore.

    Lol, yes earn £500 a week from home, ive seen the ads are they real then?

  • rate this

    Comment number 243.

    Child benefit definately should be limited to 2 or 3 children. We are not living in the 19th century when infant mortality was high, so we do not need to over-produce any more. . But they MUST be financially responsible for them!


    So what do you propose happens to the children of the "Over Producers" ?

    It's not their fault they weren't born with wealthy parents.

  • rate this

    Comment number 242.

    Amongst all this political rhetoric on welfare reform is some long overdue common sense. When the history of the Cameron government comes to be written there will be a catalogue of stupid errors such as the 45p tax rate. But welfare reforms will be one of the few outstanding achievements of this government.

  • rate this

    Comment number 241.

    The great "make work pay" panto is destined to join the ranks of other substance free nonsense like Big Society and Free Schools.
    Cosmetic disguises for flawed ideological myopia.
    Can't wait for the forthcoming "unlock your equity to fund your healthcare" scam to gather momentum

    Don't be fooled by the lipstick and foundation, underneath that thin veneer it's the same old tories.

  • rate this

    Comment number 240.

    210. laughingman

    You can claim that these vast hoards of Benefit Scroungers are just a myth but these Socialist lies are now under the spotlight. They hard working tax payers have had enough. The £ billions which are stolen to hand out to the vile products of this system is a disgrace. The workers know all this to be true. The big stick is on the way for these scroungers the workers demand it

  • rate this

    Comment number 239.

    Benefit should not support those able to work with a standard of living higher than those that do work. It should provide a safety net for the disabled & short term support for unemployed. Food and shelter in extremis for all but not subsidised rental in high cost areas. Govt must reduce the barriers to work especially at the bottom of the scale. Cut NI on low paid, cut red tape on SME's.

  • rate this

    Comment number 238.

    It's all very well saying that benefits should be linked to work and contributions paid while in work, but where are all these jobs Labour keeps promising there will be for the unemployed? I still have to hear where these are coming from. I'd vote for them if they promised to repatriate all jobs that have been outsourced abroad so that unemployed British can have them - is that too much to ask?


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