Benefits reform – will it fail David Cameron’s Big Society Challenge?

David Cameron has always been clear that that Building the Big Societyisn’t just the responsibility of one or two government departments” but  the “responsibility of  all government departments” . As we have been finishing off our response to the government’s plans for benefits reform  (21st Century Welfare). We have focused on a fundemental area that the consultation fails to mention, yet David Cameron has made a top priority for the government – the importance of communities in developing local solutions. The single largest element of government spend in most deprived communities is the billions it spends in benefit and welfare to work costs. So we have asked Iain Duncan Smith how he will ensure that the millions of pounds spent is an investment in local communities and supports David Cameron’s vision of a  Big Society?

 In order to recognise the importance of local communities in welfare reform we are proposing an eighth principle to guide welfare reform (Q5 of the consultation document)

 Individual claimants live in communities. Welfare policy should harness the power of communities to support the individual’s transition into work and welfare spend should be an investment in local communities as well as individuals.

 The Community Allowance offers a practical and affordable way to unlock the potential of communities to create new jobs, support individuals back into work and transform communities.

 The Community Allowance would create new jobs by enabling community organisations to pay local unemployed people to do part time, sessional or short-term work that strengthens their neighbourhood. The unemployed person would be able to keep these earnings on top of benefits, making work pay and providing a stepping stone to employment.

The Community Allowance

  • Is a package of training, work and personal support delivered very locally by trusted community organisations, with strong track records of working with the hardest to reach.
  • Gets people back into work, gaining experience and employability in a supportive environment.
  • Enables community organisations to develop local solutions and jobs which directly improve and regenerate their communities.

The proposed changes to earning disregards and tapers have the potential to enable the Community Allowance approach to be available to everyone on benefits and to every community. Our approach would create some of the jobs required to enable people to take their first important steps back into work.

There are two ways that the Community Allowance could make a significant contribution quickly and affordably, prior to wholesale reform:

  • An immediate option – we are already in discussions with potential Prime Contractors to offer the Community Allowance through the Work Programme for Incapacity and ESA claimants using existing disregards. However, due to the proposed reassessment of Incapacity Benefit claimants we would need to work with DWP to ensure a level of certainty which would allow delivery;

 

  • An “in the meantime” option – if the current financial constraints mean that more generous universals earning disregards are seen as unaffordable, we recommend that a Community Earnings Allowance/Disregard is created as a first step towards comprehensive reform. This would recognise the additional social and economic impact achieved through creating stepping-stone jobs that also contribute directly to stronger communities.

We are aiming to to submit our response to the Consultation in a weeks time and I would really welcome your thoughts on our eighth principle and the challenges facing Iain Duncan Smith.

Best wishes

Louise

PS I am on annual leave until Monday 27th September

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