Ed Miliband: Labour would cap social security spending

 

Labour leader Ed Miliband: ''The system does need reform''

Related Stories

Ed Miliband has promised to cap spending on benefits as he unveiled his party's new approach to welfare.

A future Labour government would introduce a three-year cap on structural spending, including housing benefits, from 2015-6, its leader said.

He also said those in work for under five years may not be eligible for some jobless benefits while those who had worked for longer should get more help.

The Conservatives said the "vacuous" plan would not bring down costs.

In a speech in east London, Mr Miliband announced a series of changes to Labour policy:

  • A three-year cap on spending on structural benefits - including housing benefit and other non-cyclical costs - will be introduced in 2015-6
  • Contribution-based unemployment benefits such as jobseekers allowance (JSA), will be reviewed
  • Priority will be given to those who have worked and paid tax for longer while eligibility for the top-up contributory JSA may be extended from two to five years in work
  • Councils will be given power to negotiate rents with landlords to help reduce housing benefits bills
  • Child benefit for families with one person earning over £50,000 will not be reinstated
  • More help for disabled people to take up work opportunities

The Labour leader said the government's "short-term" approach was failing and history showed that cutting individual benefits alone would not reduce the overall cost of social security.

Instead, Labour would tackle the "underlying causes" of rising welfare costs, such as unemployment, low pay and high rents.

Start Quote

What was clear today, however, is the Labour leader's philosophy. He believes that cutting benefits is not the way to cut the benefit bill”

End Quote

"The next Labour government will have less money to spend. If we are going to turn our economy around, protect our NHS, and build a stronger country we will have to be laser focused on how we spend every single pound.

"Social security spending, vital as it is, cannot be exempt from that discipline."

He said Labour, if elected, would introduce a cap on "structural spending" - such as housing benefit and disability allowances - for three years from 2015-16 to deal with the long-term pressures on welfare budgets.

The idea of a cap - which would not affect parts of the welfare budget affected by changes in unemployment - was suggested by Conservative Chancellor George Osborne in March's Budget.

'Faith shaken'

Mr Miliband did not give an overall figure for the cap, saying it would have to be set at a "sensible" level, but argued that it would help "to control costs" and introduce "greater discipline".

He said the country could not afford to continue paying billions on housing benefit when there was a chronic shortage of new homes being built.

A future Labour government would give councils the power to negotiate with landlords on tenants' behalf over rents and keep any savings they make to invest in building new homes.

Start Quote

Ed Miliband is too weak to deliver the tough decisions on welfare hard working people rightly want to see”

End Quote Grant Shapps Conservative Party chairman

"This government talks a lot about getting housing benefit under control," he said. "But let me be clear: any attempt to control housing benefit costs which fails to build more homes is destined to fail."

Mr Miliband also outlined plans to cut long-term unemployment and encourage employers to pay a "living wage", keeping the costs of in-work benefits down, as well as increasing opportunities for disabled people.

Welfare could not be "a substitute for good jobs and decent employment", he said.

The Labour leader said people's faith in the welfare system has been "shaken" by the appearance that a minority of people were getting "something for nothing and other people nothing for something."

He pledged to restore the "contributory principle" to jobseeker's allowance, so that only people who have paid in "for significantly longer" than the current minimum of two years will be eligible.

The party, he said, will look at whether to give more than the current £71-a-week rate to those who have contributed longest, as this was not "a proper recognition of how much somebody who has worked for many decades has paid into the system".

'Distinctive choice'

The BBC's political editor Nick Robinson said Labour believed they could reduce the benefits bill by getting more people into work, getting employers to pay higher wages and reforming the private rental market.

Start Quote

There's a difference between putting a cash ceiling, which will be difficult to operate in some areas of welfare expenditure, and dealing with what is the main criticism of voters”

End Quote Frank Field Labour MP

In that sense, he added, it did not mark a fundamental change in approach since Labour were not yet spelling out what benefits they would cut and who would get less.

Earlier this week, shadow chancellor Ed Balls said the party would end winter fuel payments for pensioners on high and top-level income tax rates, but this is only likely to raise £100m.

Labour MP Frank Field, a critic of the party's welfare policies in the past, said the speech was a move in the right direction but more must be done to allay public perceptions there was a "something for nothing" culture in the system.

"There's a difference between putting a cash ceiling, which will be difficult to operate in some areas of welfare expenditure, and dealing with what is the main criticism of voters," he said.

But speaking on his weekly phone-in on LBC 97.3 FM, Deputy Prime Minister Nick Clegg said Labour had spent the last three years "vilifying" coalition benefit changes but had now "flip-flopped" to support them.

And Conservative Party chairman Grant Shapps called the speech "completely empty".

He added: "Ed Miliband is too weak to deliver the tough decisions on welfare hard working people rightly want to see. His plans would actually increase welfare spending, and mean more borrowing and more debt."

The government is introducing a £26,000 annual cap on total benefits that can be paid to a single family, which it says means no-one on state support will get more than the average annual income.

An estimated 67,000 households will be affected by the cap this year.

 

More on This Story

Related Stories

The BBC is not responsible for the content of external Internet sites

Comments

This entry is now closed for comments

Jump to comments pagination
 
  • rate this
    +27

    Comment number 863.

    This is lip service. They'd get back in and go back to spend, spend, spend and throw the doors open to all and sundry again through unfettered immigration.

    Britains have seen their wages and job choices back slide 10 years, as well as the worst secular, racial and national divides seen in generations. This is all due to 13 years of Labour policies; they will do this again.

  • rate this
    +1

    Comment number 692.

    This highlights how out-of-touch the Labour leadership(?) is with the grass roots. Labour should be for the workers, poor and unemployed NOT for the uncaring high earners and rich. The headlines here will only depict Labour as moving back towards the new conservative party which it became under Blair/Brown. Start now supporting your core by saying you will raise taxes on business and rich!

  • rate this
    +135

    Comment number 71.

    There is no substance behind these headline grabbing ideas, merely a move to try and regain some ground on the Tories' lead on Welfare reduction.

    No mention of how they will persuade companies to increase their wage bill (farcical: not a chance!!!) nor how councils will force landlords to reduce rents (again, not a chance).

    The only way to achieve these things would be through legislation.
    Great

  • rate this
    +249

    Comment number 49.

    I wonder what happened to conviction politics, rather then sound-bites, spin and rhetoric.

    I am deeply disillusioned with the current crop of politicians - there's not that much to choose between them. Neither party gives a hoot for anyone other than their supporters / backers.

    Tax payers will just keep funding their luxury lifestyle and gold-plated pensions.

    No wonder the country is in a mess!

  • rate this
    +156

    Comment number 42.

    The crux of the welfare issue is shifting the mentality of all people, whatever the level of their income and "wealth" so that they once again take as much responsibility as they can for supporting themselves. That will still leave many people who are in genuine need and we should continue to support them.

 

Comments 5 of 6

 

More Politics stories

RSS

Features

  • An undated file photo posted on 27 August 2014 by the Raqqa Media Center of the Islamic State group, showing IS fighters waving the group's flag from a damaged government fighter jet in Raqqa, Syria.Adapt or die?

    IS militants seem to be changing tactics after air strikes


  • signClean and tidy

    Things that could only happen in a Hong Kong protest


  • Child eating ice creamTooth top tips

    Experts on ways to encourage children to look after their teeth


  • Almaz cleaning floorAlmaz's prison

    Beaten and raped - the story of an African servant in Saudi Arabia


  • Train drawn by Jonathan Backhouse, 1825Original 'geeks'

    What hobby did this drawing start in 1825?


BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.