Major reforms to welfare system announced

11 November 2010

Deputy Prime Minister Nick Clegg has joined Work and Pensions Secretary Iain Duncan Smith to announce a radical overhaul of the welfare system.

Launching the White Paper ‘Universal Credit: Welfare that Works’, they said the reforms were driven by the principle that the purpose of welfare is to help people into work.

Read the White Paper: Universal Credit: welfare that works

At the heart of the changes is a new Universal Credit which will bring together a raft of existing benefits into one single, basic household allowance and will be available to working and non-working families. The amount that claimants will receive will depend on factors such as income, number of children and the cost of their housing.

The Deputy PM said:

Under the new rules, people will no longer be penalised for working. Our changes will ensure that work is always worthwhile, even if it is just a few extra hours a week. As people find jobs, or increase their hours, financial support will be withdrawn gradually and clearly.

He added:

Across the country households will be better off. Not just better off because they’ve crossed a notional poverty line. Better off because they will have the chance of a better life for themselves, and a better life for their children. As the saying goes, a hand up, not a hand out.

Read the Deputy PM’s speech in full

Read Work and Pension Secretary Iain Duncan Smith’s speech [external website]