Britain’s benefits crisis is crippling our economy and fuelling mass-immigration – my five ways to cure it

BARNSLEY is an unlikely place to find a solution to Britain’s benefits problem.

The South Yorkshire former mining town was on the front line of mass unemployment in the 1980s as pit closures decimated communities.

 Today, joblessness in Barnsley is lower than the national rate.

The area is on the up. But Barnsley also has a higher rate of economic inactivity — people on benefits, out of work and not seeking a job — than elsewhere.

Far more Barnsley residents suffer ill health and disability than in other parts of the country.

In this regard, Barnsley is a symbol for modern Britain. There are 2.8million Brits off work sick. They now make up more than one in five working-age people.

The societal consequences are catastrophic. So too is the economic price our country pays.

The biggest barrier to raising the UK’s sluggish rate of economic growth is a shortage of labour.

And unless we can get more sick Britons back to work, the nation’s soaring welfare bill will be unsustainable.

 Sickness benefits are due to hit £75billion by the end of the Parliament.

This is where Barnsley could have the solution. Over the past year, I chaired a commission undertaking in-depth research into economic inactivity in the area.

 The commission’s report, published in the summer, found that radical reforms of the welfare, health and employment support system are needed.

Many of its conclusions informed welfare Secretary Liz Kendall’s recent White Paper.

The starting point is to understand how broken the current system is.

In Barnsley, we found seven in ten people who are off work sick would like to be able to work, eight in ten of them get a state benefit but only one in ten have any contact with the employment services that could help them find a job. This is a total system failure.

There is no single silver bullet to fix it. Five big changes are needed.

Step 1

WORK incentives should be strengthened. At present, claimants get more in benefits if they are classified as being too sick to work rather than actively seeking employment.

Of course, many people who get incapacity benefits have severe disabilities and need higher financial support.

 But overall, the system is perverse and that gap, over time, should be narrowed. The Labour Government has already rightly said that young people will lose benefits if they don’t take a job or training under its Youth Guarantee.

It should also make it a condition of getting benefits that people have a “duty to engage” with employment services.

Step 2

IN Barnsley, three in four economically inactive people have a health condition that they need help to address.

 The benefits system is being overwhelmed by this tide of ill health. The longer people are out of work, the less likely they are to go back.

 So, early intervention is needed, with a priority to tackle growing ill health among young people.

Britain cannot afford to have a whole generation consigned to a life devoid of both work and hope.

But at present, employment and health services are like ships that pass in the night. They don’t meet. So local services should be better integrated.

The NHS should do more to help get sick Brits back to work.

 And employers also need to do more to keep people in work by improving workplace occupational health care.

Step 3

GOVERNMENT should work with employers to ensure jobs are secure enough, flexible enough and well paid enough to make employment worth it.

Increasing wages will help expand the gap with benefits.

A national Good Employer Charter should be introduced so people can see where quality work opportunities exist.

 And to encourage people into jobs, claimants should be able to try a job for a period without losing benefits, to reduce the fear of returning to work.

Step 4

THE “system” designed to help people find employment is a spaghetti soup with more than 50 national programmes led by 17 public bodies.

That needs some radical streamlining. With only one in six local employers prepared to use JobCentres to recruit workers, it should be denationalised to make sure they are working to better meet their needs.

 It is welcome that the Government is giving mayors responsibility for joining up local employment and careers services.

It should go further by allowing the best-performing areas to keep any savings they achieve in the benefits bill to reinvest locally.

That will provide a carrot for mayors to drive down levels of economic inactivity.

Step 5

THE easy solution of importing more workers from overseas has to give way to a focus on getting more out-of-work Britons jobs.

Immigration will always play an important part in tackling labour market shortages.

But if our research findings in Barnsley were applied nationally, there may be more than 4.5million economically inactive people already here in Britain who could be in the market for a job now or in the future.

These people should be the priority for the Government’s attention.

It should set a new target for reducing the level of economic inactivity over the next five years.

It is time for a radically new approach where people have a right to work and an expectation that those who can should do so — and be offered more help.

Tackling economic inactivity must become a national mission for government, employers, local authorities, communities and, of course, citizens themselves.