I was going to do a blog on this but I’ve got man flu and I thought that the letter spoke for itself!
RichardRt Hon Danny Alexander, Chief Secretary to the Treasury, Treasury, Whitehall, London SW1
27th September 2010
Last week at the Lib Dem Conference we discussed twice the potential for localisation of benefits. At the first of these, with Lib Dem Council Leaders, it was clear that this option was universally endorsed by the Party. At the second of these, a visit to a coalition of the willing looking at public sector delivery in North Liverpool with Norman Lamb, it was clear that a wide variety of public sector players supported this.
Put simply benefits payments are one of the three biggest wastes of public sector money. I know from many years experience that the vast majority of people in receipt of a range of benefits want to work. Even many who are incapacitated want to do something both for society and for themselves as work does provide a physical and mental challenge.
Instead we have designed rules and regulations designed to keep people inactive. In regeneration areas benefit spending often tops all other local public spending put together. It produces no results and often inhibits individual enterprise.
I want to suggest three things which would enable us rapidly to get enhanced value for money for the benefits that we spend:
Firstly, put the administration of all benefits into the hands of local councils. Together we maintain a vast number of one stop shops in the heart of our communities from which we already deliver housing and council tax benefit. Most of our councils are now high performers and could deal with all benefits in one place at one time. This would have two effects:
- It would reduce worklessness by reducing the fear of benefit traps. For many the rules are too complicated that they will not risk getting low paid part time jobs even though they could progress to better jobs because it takes so long to get back into the system if they fail.
- It would cuts costs. By providing a ‘Total Place’ solution for benefits we could cut out many costs of administration and employment.
This localisation could lead to the second major step:
Secondly, localise decision making about benefit levels; how they are paid and who receives them to local councils. In that way we would be able to use money effectively by applying appropriate levels to people and linking benefit packages to training and regeneration resources. This will get people back into temporary work in the short term but re-energise communities in the long term.
Thirdly, let us get some real ‘welfare to work’ pilots going. These have been tried before but failed because Whitehall and the structure were not prepared to let go. Ease the rules so a number of pilots can get local activity going whilst government gets the two big items above sorted out. Do that that and we can get some people in benefits in some areas of Liverpool and other places working quickly by providing a ‘work premium’ in addition to benefits already received.
At the end of the day there are many jobs that need to be done in the community and many people with the time and skills to do them. Paying people to do nothing as we have done year after year is almost a criminal waste of money.
I am copying this to Norman Lamb and will raise the idea at a meeting with Nick Clegg on Wednesday. I am also copying this to appropriate Ministers.
Cllr Richard Kemp,
Leader LGA Liberal Democrats