By
David Williams
16 September 2010
Although Work and Pensions Secretary Iain Duncan Smith denied there was a rift between himself and Chancellor George Osborne, he admitted they had yet to reach agreement about his department’s settlement for next month’s Spending Review.
Giving evidence to the Commons work and pensions select committee on September 15, he said: ‘Any figure in the Spending Review, I cannot confirm. We [Duncan Smith and the chancellor] have not reached any conclusions about this at all. Not at all.’
In a further signal of the tension between the two departments, Duncan Smith dismissed claims that £4bn could be cut from the welfare bill by being tougher on those unwilling to work.
The figure had been leaked by Treasury sources following less specific remarks on the subject from Osborne. ‘The £4bn – I simply do not recognise that figure at all,’ said Duncan Smith.
The work and pensions secretary has set out plans to provide more incentives for people to work. Although the proposals save money in the long term, they require upfront investment.
Ian Brinkley, associate director of the Work Foundation, predicted the plans would not get off the ground, claiming Duncan Smith was ‘only postponing the inevitable [defeat]’.
He told Public Finance: ‘Battles between reforming welfare ministers and the Treasury only have one result, and that’s the Treasury winning. It’s going to be long drawn-out and there’s going to be lots of blood on the carpet.’
Patrick Nolan, chief economist at think-tank Reform, agreed that whatever reforms eventually come into effect were unlikely to closely resemble Duncan Smith’s ideas. He added that June’s Budget showed that Osborne preferred to make savings across the board rather than reduce ‘middle-class benefits’ to concentrate money where it is most needed.
‘They’re cutting, not reforming,’ he said.
The debate came as figures from the Office for National Statistics showed the biggest quarterly leap in overall employment since 1971, with an extra 286,000 people in work by the end of July compared with the end of April. But, there were also 2,300 more Jobseeker’s Allowance claimants.
The ONS also reported a decline in the number of public sector workers: the state employed 22,000 fewer people at the end of the second quarter of 2010 compared with three months earlier, with the figure now 6.051 million.
Brinkley said it was the first sign of cutbacks in the public sector, adding that redundancies were falling mainly among the more basic white-collar jobs.
At this week’s Trades Union Congress annual conference in Manchester, Bank of England Governor Mervyn King told delegates they were ‘entitled to be angry’ about the recession and higher unemployment. Delegates had earlier voted to stage joint industrial action if ‘attacks’ on jobs, pensions and public services go ahead.
16 September 2010
Proposed reforms to the welfare and benefits system appeared to be in jeopardy this week after talks between the Treasury and Department for Work and Pensions stalled and analysts said the plans were unlikely to be implemented.
Although Work and Pensions Secretary Iain Duncan Smith denied there was a rift between himself and Chancellor George Osborne, he admitted they had yet to reach agreement about his department’s settlement for next month’s Spending Review.
Giving evidence to the Commons work and pensions select committee on September 15, he said: ‘Any figure in the Spending Review, I cannot confirm. We [Duncan Smith and the chancellor] have not reached any conclusions about this at all. Not at all.’
In a further signal of the tension between the two departments, Duncan Smith dismissed claims that £4bn could be cut from the welfare bill by being tougher on those unwilling to work.
The figure had been leaked by Treasury sources following less specific remarks on the subject from Osborne. ‘The £4bn – I simply do not recognise that figure at all,’ said Duncan Smith.
The work and pensions secretary has set out plans to provide more incentives for people to work. Although the proposals save money in the long term, they require upfront investment.
Ian Brinkley, associate director of the Work Foundation, predicted the plans would not get off the ground, claiming Duncan Smith was ‘only postponing the inevitable [defeat]’.
He told Public Finance: ‘Battles between reforming welfare ministers and the Treasury only have one result, and that’s the Treasury winning. It’s going to be long drawn-out and there’s going to be lots of blood on the carpet.’
Patrick Nolan, chief economist at think-tank Reform, agreed that whatever reforms eventually come into effect were unlikely to closely resemble Duncan Smith’s ideas. He added that June’s Budget showed that Osborne preferred to make savings across the board rather than reduce ‘middle-class benefits’ to concentrate money where it is most needed.
‘They’re cutting, not reforming,’ he said.
The debate came as figures from the Office for National Statistics showed the biggest quarterly leap in overall employment since 1971, with an extra 286,000 people in work by the end of July compared with the end of April. But, there were also 2,300 more Jobseeker’s Allowance claimants.
The ONS also reported a decline in the number of public sector workers: the state employed 22,000 fewer people at the end of the second quarter of 2010 compared with three months earlier, with the figure now 6.051 million.
Brinkley said it was the first sign of cutbacks in the public sector, adding that redundancies were falling mainly among the more basic white-collar jobs.
At this week’s Trades Union Congress annual conference in Manchester, Bank of England Governor Mervyn King told delegates they were ‘entitled to be angry’ about the recession and higher unemployment. Delegates had earlier voted to stage joint industrial action if ‘attacks’ on jobs, pensions and public services go ahead.
