When I last interviewed Nigel Farage, he told me a new divide was opening in Britain. The country was being cleft in two: workers on one side, workless on the other. He was in no doubt whose team his insurgent party was on. Robert Jenrick’s welfare reforms are the fullest expression yet of that argument. Reform has today promised to cut a whopping £50 billion from the benefits bill – a little under half of all working-age welfare spending.
Whilst the plausibility of this scale of saving may be debatable, the diagnosis is hard to dispute. In the past two decades, Britain has created a workfree lifestyle which barely existed before. We have contrived to build a system in which incapacity is treated as a permanent status rather than a condition to be overcome; in which the state asks what someone can’t do long before identifying what they can; and in which the financial incentives often favour remaining sick over getting better.
It’s difficult to argue against this when you look at the numbers. Pre-Covid, around 13,000 initial awards were made on new PIP claims each month; now it’s roughly 34,000. Psychiatric disorders have become the largest disabling-condition category among PIP claimants. The explosion in sickness and disability benefits has been disproportionately driven by mental health and behavioural conditions which, until a few years ago, few seriously believed should preclude work. To proceed from a diagnosis of ADHD to an assumption that someone can’t get some sort of employment, for instance, surely stretches credulity.
Whilst the plan as a whole may sound next to impossible, aspects of it may be more feasible
It’s been argued that, if Jenrick becomes the Grim Reaper of welfare reform, his party will pay at the ballot box. It is true that Reform seats and target seats have a lot of people on PIP, though it doesn’t follow that they are Reform voters or likely to be – the higher probability is that they are non-voters or Labour, which helps explain why Keir Starmer’s embarrassingly modest changes to disability benefits never made it through the Commons. The majority of voters in Reform constituencies are not on PIP, and the inference that they are is the sort of sneering nonsense common on the Left.
More interesting is Jenrick’s insistence today that pensioners will not be caught by his welfare crackdown. Perhaps Reform’s dividing line is less taxpayers versus scroungers and more older voters versus younger ones. This is consistent with their commitment to retaining the triple lock while promising to reinstate the two-child benefit cap.
But if pensioners are to be spared, Reform is proposing shock therapy for almost everyone else in the welfare system. First, foreign nationals would be denied almost all benefits, which Jenrick optimistically suggests would eventually save £21 billion a year. Politically, this has obvious appeal: most voters expect newcomers to contribute, not withdraw.
Yet the proposal is far messier than the slogan. Many visa holders already have ‘no recourse to public funds’. Reform’s definition catches people permanently settled in Britain, including EU citizens with settled status, who may have lived and paid taxes here for decades. Changing their entitlements could require reopening agreements with Brussels, whilst many with indefinite leave to remain could simply naturalise to access welfare.
Second, Reform wants to take a chainsaw to disability benefits, abolishing PIP and the health element of Universal Credit. A new ‘health security allowance’ would reserve cash payments principally for severe and enduring disabilities. As Jenrick admits, up to 2.89 million people could see payments reduced or removed. And many other voters – spouses and adult children – would be affected as an increased financial burden fell on them.
There would be single, clinician-led, face-to-face assessments (currently only around 6 per cent are in-person), the practicalities of which would be immensely challenging. Then comes the hardest sell: some 330,000 people judged capable of working but unemployed for more than a year would have to perform 20 hours of community service – cleaning high streets, helping charities, working in libraries – or face penalties.
Yet if someone is capable of compulsory work, why shouldn’t those hours be spent in an actual job? Who will administer and supervise people who might be doing more productive work elsewhere? And councils are already pleading poverty without this extra responsibility. Does anyone seriously believe sanctions will be imposed on those who refuse to oblige?
Read Reform’s document and it’s clear that the costs are upfront, whilst savings are more speculative. Reform would pay employers £3,200 a year for three years if they hire someone from benefits. Such job subsidies have a dismal record. ‘Return to Work Cover’, inspired by the Dutch system, would shift more responsibility for prolonged sickness onto employers, supposedly compensated by lower employer National Insurance. But there would be extra compliance costs and changes in employer behaviour – employing fewer full-time workers, for example – which are difficult to predict.
Whilst the plan as a whole may sound next to impossible, aspects of it may be more feasible. It at least gets us talking about some issues Labour and the Tories don’t want to talk about, such as the imbalance between the total number of UK expats getting benefits in EU and the larger number of EU nationals getting them here. Not many Brits are getting benefits in Romania; our poor don’t migrate. Abolishing Angela Rayner’s job-destroying Employment Rights Bill would be a quick win.
The Reform scheme will be popular with many, whatever the doubts – and this may have the result of pushing Conservatives to up their plans. Labour is probably a lost cause, but Reform’s pressure may allow Andy Burnham to gain a bargaining advantage with his Left-wingers if he attempts any reform, however limited. In short: Reform deserves credit where some credit is due.
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