Tag: Speeches

Below is the text of the speech made by Jim Murphy, the then Minister for Employment and Welfare Reform, to the Work Foundation on 21st February 2007.

We have made progress – but we need to go further.

This is a common phrase that myself and many of my colleagues in Government often use – but what does this actually mean? It can’t just be more of the same. “To go further” means that we have to look for new ways of doing things to achieve the goals to which we aspire; some of which we have yet to achieve.

In 1997, we developed solutions to the problems of the day. The New Deal, the National Minimum Wage, transforming our laws on race, disability, age and sexuality as well as the record investment in public services, were all radical in their time. But now these policies have been accepted by most as part of a progressive political settlement.

We need to maintain our ambition, and be as radical now as we were back then. Solutions tailored to today’s problems will not be successful if they are bound by yesterday’s policies.

The key challenge for welfare now, it is to deliver for those people who face the most deep-rooted barriers to work.

Why? Because we cannot write any one off. Not just because of a sense of social injustice. Not just because children should have the right to grow up free of poverty. But also, because if we do, the economy as a whole will suffer – and every single member of our society will see the consequences.

Achieving this goal of a right to work for all, in the context of ever more rapid global and demographic change, will mean reaching out to those furthest from the labour market, the most disadvantaged and excluded in our society. It will mean extending the boundaries of welfare further than ever before.

This seminar, as you know, is part of a series of seminars which are contributing to the Pathways to the future process – announced by the Prime Minister and Chancellor in the Autumn.

We are at a crucial stage in the evolution of the welfare state. The reforms over the last decade have changed the focus for the vast majority of our customers – from that of passive dependency to active engagement with the state. Throughout this, either implicitly or explicitly, the contract between the citizen and state has evolved.

And if you look at progress over the last decade, the where the contract has been expanded the furthest, and the more explicit the contract has been, the more success we have had.

Take Jobseekers’ Allowance alongside the New Deal. A written contract outlining what is expected of the customer, and what they can expect in return. Results are clear. Youth unemployment has been virtually eradicated.

Take the proposed Employment and Support Allowance – again, an agreed set of objectives, with rights and responsibilities embedded at the heart of the benefit design. Based on the Pathways to work model which has been the most successful programme for people with health conditions and disabilities across the world.

These are founded on a something for something premise. Government to provide more support; customers to have a duty to take up that support. This contract has revolutionised the way in which the state and the citizen interact – and it has been crucial for the success of our welfare to work policies so far.

Therefore, to achieve the challenges that we are faced with over the next decade, I believe we have to widen and extend the contract further than we ever have before.

The contract we are talking about here is a complex one. A citizen is at times, a customer of the welfare state; but is always a taxpayer. And the state is, at times, the direct service provider; but is always the guarantor of its citizens’ rights.

It is across this diverse network of relationships that the contract must deliver. And to deliver for the next decade, I think there are three key elements that will be need to underpin to its evolution and construction over the years to come.

Firstly – Given that our aspiration is to extend the right of work to all; the assumption of a person’s ability to engage with the labour market should be the default position when determining a person’s interaction with the welfare state. But the pre-requisite to this, has to be that the Government fulfils its responsibilities of promoting and protecting the right to work for all.

The passage of the Welfare Reform Bill shows how far we have come in acheiving the right balance. The proposals introduce additional responsibilities to a group of people who it would not have been conceivable to place conditionality on a decade ago. Yet because we have committed to providing extra support, the overwhelming majority of stakeholders have welcomed this.

We would not be successful had this support not been guaranteed. We know that increased responsibilities on a citizen can only be embedded in a system if they have increased rights. We are committed to our part of the bargain – our side of the contract.

Given that is the case, I believe the primacy of the belief that all have the potential to work, should be at the heart of the citizen’s side of the contract. To not, I feel, is an insult to our customers, and a get-out clause for the state.

Secondly – even if the state takes a step back from delivery; it does not take a step back from responsibility.

As I have said, the key challenge for welfare is to reach the hardest to help. Our success will hinge on our ability to understand the specific barriers these groups face; and our capacity to tailor support to the individual in the community. The state cannot do this alone. The skills of local providers will be increasingly more important.

So where the state is removed from direct service provision, it must take on the role of arbiter and monitor of the contract. The market can not, should not and will not be left unchecked. Whilst we must harness the potential of the market, we must also be strong in holding providers to account on behalf of our customers.

This is about much more than the nuts and bolts of how provision is delivered. It is about ensuring that provision, no matter what its derivation, is underpinned by our values and our priorities.

And thirdly – the citizen as a taxpayer must never be neglected.

We must maintain the right to provide progressive public services.

And to do this, we must take it upon ourselves to promote a sense of progressive self-interest.

We need to reinvigorate the sense of social contract – that what happens to our neighbours, matters to us.

Over the last decade, benefit expenditure on Jobseekers Allowance, incapacity benefits and lone parents has fallen by around five billion in real terms. But this is not simply an economic argument. Progressive self interest is about making the wider connection between personal aspiration and the continuing right of the State to enable collective solutions that meet those aspirations. It is also about re-energising the consent for Labour’s values and policies.

But even those who are already won over on this argument need to be convinced that our way of doing things is the right way of doing things. To do this, we have to ensure efficient and effective service provision.

In this, we must be bold. If there are providers out there who can deliver a service better than the state, we should not shy away. Just because it is the Government’s role to ensure there is service provision for all; it does not necessarily follow that it is also Government’s role to deliver that service. Rather it is the Government’s responsibility to ensure that the provision that people have is the best service they can get.

I believe our success in tacking the challenges created by demographic change and globalisation rests not just on technological improvements or scientific advancement. It rests on people. Individuals, able to fulfil their potential – crucial for them, and critical for the country.

It is only through developing a better relationship between citizen and the state that we can meet our goals. And improving that relationship means developing and enhancing that relationship on all sides – for customers, the state and taxpayers.

We sometimes talk about rights and responsibilities as if it is a balancing act which we need to perform in order to maintain an equilibrium.

But the ultimate responsibility of the state is to promote and protect its citizen’s rights. This includes the right to work.

The ultimate responsibility of the citizen is to utilise and capitalise on that right.

The contract is key. If we can get the balance right, if we can all honour the deal that we make, we will all reap the reward.

Below is the text of the speech made by Jim Murphy, the then Minister for Employment and Welfare Reform, to the Work Foundation on 12th February 2007.

One of the key challenges that Government faces, is to keep up with the pace of change – in society; in technology; and in the economy.

Nowhere is meeting that challenge more important than within welfare. For the Welfare State has the potential both to mitigate some of the difficulties that change brings, and to exploit many of the opportunities change provides.

And as the world around us changes, so do aspirations and expectations. It is our job in Government, to not only match, but anticipate those aspirations and expectations – and to exceed those where ever we can.

Tony Crosland, a Cabinet Minister under Wilson and Callaghan, encapsulated perfectly why this is a never-ending task. He said, back in 1975, “What one generation sees as a luxury, the next sees as a necessity.” The timeline from luxury to necessity is now not a generation but a decade. A decade ago – a mobile phone was the preserve of the prosperous. Now, 96% of 15-24 year olds have one.

So, what do I see as our major challenge for the next decade? It is to use today’s trends, to predict the world of tomorrow. And crucially, to act now on what we know to ensure that the welfare state is fully equipped to meet the aspirations of all in the years to come.

To do this, we must take a step back to explore what lies ahead for us over the next ten years. The Pathways to the Future process which the Prime Minister and Chancellor announced in the autumn, is central to this. As part of this process, we have asked David Freud to lead a wide-ranging review of our welfare to work strategy. This seminar is the second of a series that I hope will contribute to this, to generate new thinking, and to make us really focus on the long-term view.

In looking ahead to the future decade, I think it’s helpful to look back at the last. This is both to learn from our successes, recognise where we have further to go, and what we must do to complete the job we set out to do.

There has been great progress in the last decade. As the research paper published today highlights, there are 2.5 million more jobs today than there were ten years ago, and employment is up in every region and country of the UK – with the biggest increases in the neighbourhoods and cities which started in the worst position. The employment rate for the most disadvantaged groups has risen faster than for anyone else – 300,000 more lone parents, 900,000 more disabled people, 1 million more people from ethnic minorities and 1.5 million more people aged over 50 are in work than a decade ago.

There are many reasons behind this. Economic prosperity is certainly one. Embracing globalisation, rather than insulating ourselves from it, is another key aspect. But also, the reforms to the welfare system have been crucial. For years the concept of ‘welfare’ was emblematic of collective pessimism. Now it is being turned around into something which can foster hope, aspiration, and truly transform people’s lives.

But despite this there is much further to go to reach our stated aim of an 80% employment rate. There are still pockets of deprivation which have not been reached, and despite our reforms, a core group of people at the bottom of the ladder still find it incredibly difficult to break free from the generational cycle of poverty.

To tackle these remaining issues, we must not see them in isolation. We have to look at them in the context of the wider challenges ahead.

So, looking forward to the next decade, we must look at those as yet unachieved policy ambitions. We must understand the direction that the world around us is taking. And we must use this to shape a welfare state which will break down the remaining bastions of inequality.

The only certainty is that no-one can know everything that will happen to us over the next decade. We can see that, by looking at where we thought we would be ten years ago.

So, what did people think would happen to the labour market in 1997?

Ten years ago, many people thought that the North-South divide would persist, perhaps even get worse – and that London would lead the way in employment. Yet Scotland now has employment rates higher than the national average, and employment problems are concentrated in cities – particularly London.

In 1997, many believed that temporary jobs would grow exponentially, and that the majority of us would work for low wages. But 10 years on, the UK has one of the lowest proportions of temporary work in the world, whilst average earnings have grown every year by around 2% in real terms.

And ten years ago, the biggest group of foreign workers were – and it was thought by some were always to be – Irish. But now, there are many more French and German people in the UK than Irish. And a decade ago, the majority of Poles living here were those who came after the Second World War.

So we know that we must be careful as to what assumptions we make about the future.

However, despite this, there are some things which we do know. There are certain trends which, if they continue as they have been, will mean we are to see significant changes over the next decade.

In 1950, there were ten people working for every pensioner; today there just under four. In ten years time, on current trends this will reduce to three, and by 2050 there will be just two.

By 2017, China and India will have nearly doubled their share of the world’s income and their economies are likely to be bigger than the UK, French and German economies combined.

And over the next decade, ethnic minorities will account for half the increase in the working age population. Indeed, in London over the next 20 years, ethnic minorities could account for around three quarters of the growth in the potential workforce.

These few statistics I think show us that we can expect a labour market in 2017 which looks completely different to that of today. And we need to act now, to ensure that the welfare state is equipped to deal with the changes that the next decade will bring.

For the rest of my time left, I will just focus on one area where we need to adapt if we are to prosper- that of skills.

As the Leitch report has highlighted, this is an area which we face serious challenges on already. Historically, the UK has faced a skills deficit for a significant period of time, but despite recent improvements we still lag behind major of our major competitors in the OECD. That is why the Government is currently considering how to best achieve the ambitions that Leitch set out in his report.

Just looking at those with very low skills levels, if we look at where the shortages are, we see a clear pattern. Over three quarters of people with no qualifications fall into at least one of the groups which are specifically targeted in our department’s Public Service Agreement targets – disabled people, lone parents, people over 50 and those from an ethnic minority.

Given that the correlation with skills deficits and my department’s customer groups is so striking, we have a duty to act to target the resources we have in improving the basic skills of the most disadvantaged.

The welfare reforms currently going through parliament address this agenda for disabled people, through providing opportunities through Pathways support. John Hutton just a few weeks ago raised a discussion about how lone parents can get better access to the labour market. And the Welfare Reform Green paper outlined the further measures we are taking to boost support for older workers.

However, the employment rate for one group is still unacceptably low – that of ethnic minorities.

We cannot tolerate a labour market where by, despite progress, a young British Asian woman starting out in work today, will have to wait until her retirement before she sees people of ethnic minorities have the same employment rate as their contemporaries.

We cannot tolerate a society where well over half of Pakistani and Bangladeshi children in Great Britain live in poverty.

And we cannot tolerate a labour market where people of ethnic minorities on average earn a third less than their counterparts across Great Britain as a whole.

This is a social injustice in our society which is not only bad for individuals, families and their communities, but is a barrier against social cohesion and is bad for Britain. On top of that, as ethnic minorities grow to constitute a much greater proportion in the working age population in the decade to come, it is absolutely critical that everyone is able to access the labour market and can prosper within it.

Of course the causes of this disadvantage are complex, but fifteen per cent of unemployed ethnic minorities themselves cite language difficulties as a barrier to work. Potentially, that’s 40,000 people being denied the opportunity to work because they do not have the language skills to get a job.

At the moment, Jobcentre Plus spends around four and a half million pounds per year on translation services. Of course, we there will always be a need for interpretation provision; but surely, wherever possible, we should also focus on language skills to get people into work?

We must utilise the resources we have to redress the balance: to put the emphasis not just on translating language to claim a benefit; but to teaching language to get a job. Not just for the sake of employment rates; but for the benefit of the individual, their community and society as a whole.

There has been a new prioritisation of learners for whom lack of language skills is a barrier to getting a job or to improving life chances. Free English provision is and will continue to be available to those in receipt of Jobseekers Allowance and other income related benefits, targeting support for our most disadvantaged client groups.

We already have a new programme in development that will offer places for 15,000 places for customers to undertake basic skills and employability training – including language skills – with the Learning and Skills Council. In addition, we have committed £14 million for training allowance provision for our customers who take up those courses.

Currently, not nearly enough of this provision is being taken up, and we must put it to better use. We need to raise our game in matching those with poor language skills to the training they need in order not just to work, but to progress in work and gain sustainable employment.

As a first step in this, I have asked Jobcentre Plus to put a much greater emphasis on helping people to address their language barriers. From April this year, in England, there will be new guidance on making sure we help people with very poor language skills start to tackle the problem, as part of the Jobseekers Agreement. We will also discuss these plans with the devolved administrations.

Our customers might, for example, look for local English language classes or other opportunities to practise English language skills. Where-ever possible, we would like them to participate in a work focused language course, where they exist. People will be able and expected to look for work while they undertake any training, and importantly, in many cases there will also be the provision to carry on with the training course after they have got a job.

We also need to take a longer-term look at the services provided through the welfare state, community initiatives and adult learning provision to see how language difficulties can be more effectively addressed. That is why I have asked the National Employment Panel to identify knowledge and good practice on tackling language barriers in the labour market, and to look at the related challenges which lie ahead for the UK on this issue for the next 20 years. This will include looking at analysis from the National Research and Development Centre and the National Institute for Adult Continuing Education, alongside looking at best international experience.

This is but one way forward in which we need to better manage the challenges ahead for the next decade. This isn’t about a change of direction. It’s about continuing along our journey.

It was a journey which began with the creation of the Labour Party. After all the Labour movement was founded on a right to work and an aspiration for full employment.

But the concept of full employment for Beveridge, was that of able bodied men. For us, this aspiration of full employment in a global economy means much more than that. We are committed to a more ambitious approach. Opportunities for all – lone parents, people with disabilities and health conditions, older workers, and ethnic minorities all able to fulfil their right to work.

In the past, too many people have been written off in the labour market. Our challenge for the next decade is to put right that historic wrong.

Below is the text of the speech made by Jim Murphy, the then Minister of State for Employment and Welfare Reform, to the Capita Child Conference on 11th July 2006.

Introduction

Last week’s End Child Poverty Report: Unequal Choices drew together some of the feedback from recent stakeholder events organised with the Joseph Rowntree Foundation.

One of the participants said:

“Childhood cannot be re-lived. Isolation, desperation and hurt are not just words for young people – they have a scarring impact. It is unforgivable that these years can be allowed to be stolen from young people through poverty.”

No speech from a Minister can sum up the impact of poverty better than that.

There is a chain of disadvantage that runs through generations of the same families. Each successive generation is a link in that chain. We have to go further to break these generational links.

This cycle of deprivation has been building momentum: poor girls become mothers younger and Joseph Rowntree Foundation research last week suggested that one million children growing up poor could produce, on average, an additional 120,000 poor children in the next generation.

We have made striking progress in tackling child poverty since 1997. In the mid to late 1980s, the UK suffered higher child poverty than nearly all other industrialised nations. Over a period of 20 years, the proportion of children living in relative poverty had more than doubled and one in three babies born in Britain was poor.

Since 1997, we have tackled worklessness by investing in Jobcentre Plus and the New Deal; we’ve introduced the National Minimum Wage to make work pay and established Tax Credits to target financial support at families with children.

The child poverty rate is now at a 15 year low and we are close to the European average for child poverty – instead of bottom as we were in 1997. We’ve made the biggest improvement of any EU nation and the number of children in relative low-income households has fallen by 800,000 since 1997.

In politics, it’s very easy to talk a lot about statistics. But that’s 800,000 more children more likely to thrive in childhood and better able to fulfil their potential as adults. 800,000 individual lives transformed – given the kind of beginnings we want for all children, and which they should have by right.

So, much progress has been made. But it has not extended far enough. Too many remain trapped in a chain of disadvantage, and those that do remain are often the poorest and most socially excluded in our society.

Working together, we must do more to break this chain. We simply cannot accept poverty as an intrinsic feature of the social landscape of the UK, where – for the most excluded – there is little more that can be done to lift them out of poverty.

We know that this problem of poverty is of human making – for too long politicians tacitly, and sometimes explicitly, accepted that a lifetime on benefit was the solution for some of our fellow citizens. That’s just the way life was. People left to struggle in poverty without any suggestion that there might be a different way of doing things. A more just way, that acknowledges human potential and the dignity families feel when they are able to provide for themselves rather than rely solely on the state.

But just as the problem of poverty is of human making, the answer to breaking the chain of generational disadvantage lies in our hands. Which is why we set ourselves the target of eradicating child poverty by 2020.

Why child poverty and why now?

The moral case is evident: children in the UK are not even born equal. The child of a poor household is more likely to be premature and the infant mortality rate is twice as high for the poorest.

By the age of 15, the 5% most disadvantaged are 100 times more likely to experience multiple social problems.

And an ever-growing body of research attests to the particular importance of a child’s early years in forming their life chances as a whole. Which is why our focus on child poverty is so essential. Through improving children’s life chances, we’re also working to prevent adult disadvantage – that life of obstacle rather than opportunity that is still the reality for too many families and communities in Britain today.

But there is also an economic case for breaking the chain of disadvantage. Child poverty is a significant factor contributing to social costs of:

£500 million a year spent on homeless families with children;

£300 million a year on free school dinners;

Up to £500 million a year on primary health care for deprived children; and

£1billion on children’s residential provision.

And where individual lives go into a downward spiral – perhaps culminating in crime or drug dependency – the cost of interventions can lead to tens of thousands of pounds of expenditure. Prevention is better than cure for the individual and for society. Eradicating child poverty is the ultimate prevention.

Evidence suggests that education, as well as parental income, is key in providing poor children with the foundation for a route out of poverty. It is through education that we can first sense and ultimately fulfil our potential.

Looking forward to 2020 – I see not the world of today, but one of unimaginable change. Today our economy has 9 million highly skilled jobs – but by 2020 will need 14 million highly skilled workers. And whereas we now have 3.4 million unskilled jobs, it is estimated that by 2020 we will only need 600,000 unskilled workers.

So, weak educational outcomes for poor children represent not just the squandering of untapped promise, but a lost opportunity for them to contribute to the economy as adults.

Today’s teenagers will be the parents of 2020 – and today’s young people are the first generation who can truly be said to be competing in a single global economy. Their competitors in the job market are the citizens of China and India, not just their peers from their community, country or continent.

Emerging and developing economies have increased their share of world trade by around a third since 1990;

China is now the sixth largest economy in the world, and is projected to be the third largest within a decade; and

China and India are producing 4 million graduates a year.

These are challenges not just for our economy but also for individuals – for the children who are at school today. Government must face up to these challenges and equip individuals to compete. I see globalisation as an opportunity. But it is an opportunity from which all must benefit.

Vision – what government is doing

Tackling poverty and breaking the cycle of disadvantage isn’t just about improving educational opportunities for poor children or putting more money into parents’ pockets. It is a multi-dimensional challenge – so we must use all the tools at our disposal in a concerted effort to end child poverty:

Improving the targeting and tailoring of our employment support – to help all those who can work do so. Achieving an enduring reduction in child poverty means that, whereever possible, people must have the opportunity and support to work and provide for themselves. Since 1997, the number of children living in workless households has fallen by over 370,000 – but the UK still has the highest proportion of all children living in workless families anywhere in Europe.

Our Welfare Reform Bill, introduced to Parliament last week, will provide the legislative framework for a new and innovative, personalised approach to supporting Incapacity Benefit claimants back to work. And because children of lone parents not in work are over five times more likely to be in poverty than children of lone parents in full-time employment, we must continue to consider how we can best target support to this group.

I also want to see the tools of the Welfare State better targeted at helping families with children in the years ahead, including considering whether and how we can refocus our employment programmes and the delivery of our future reforms, so that helping parents back into work is fully integrated into their objectives and ways of working.

Providing the right financial support – creating the right incentives to work, balanced with support for those who can’t. This is particularly important in supporting the transition into work. Good quality childcare is an essential part of this picture – building further on our investment in Sure Start and early years education, to deliver our commitment to universal, affordable childcare for 3 to 14 year olds by 2010.

Tackling in-work poverty – enhancing skills to lay the foundation for progression in the workplace and supporting the partners of those in work. Around half of the children living in poverty in Britain today live in a household where an adult is already in work – largely couple families who do not work enough hours or earn enough to escape poverty. To help the in-work poor we must look at new ways of encouraging second earners into work; continue to make sure that work pays, and do more to improve progression in the labour market by supporting and extending investment in skills.

And we must also improve awareness and understanding of the benefits system, so that, for example, more people realise that Housing Benefit and Council Tax Benefit can be claimed in work. Recent evidence has shown that this would increase work incentives.

Reforming the Child Support system – so that it is fully aligned with our target to halve and then eradicate child poverty. Research from the Joseph Rowntree Foundation showed that, in 2000, child support made only a 3% contribution to tackling child poverty in the UK – compared to as much as 25% in Switzerland and Austria.

Child Trust Funds – ensuring that all children are brought up with a chance to save, with poor children benefiting from a boosted Government contribution. So that all young people can embark on their adult life with a financial nest-egg to help them get their foot on the opportunity ladder and build the habit of saving. For Labour, the politics of aspiration and the politics of poverty are not in conflict, in fact they go hand in hand.

Redistribution of power in public services – we must see a real improvement in public services, but we haven’t yet gone as far as we need to. Inequality still remains in some aspects of our public services, and in some of our poorest communities they have not improved quickly enough. So what is the solution? Wait for a gradually improving uniformity to reach the poorest performers? I, for one, am not willing to wait.

I want to enable further choice in public services – meaningful choice of high quality services. I want to ensure that those without:

The sharpest elbows;

Family networks or social capital; and

Those whose voices have not yet been heard in this debate

… have greater power placed in their hands.

Political progressives have long discussed the redistribution of wealth. We have been inexplicably muted on the redistribution of power.

So we must be confident that we are using all our tools to combat child poverty to maximum effect. Tackling child poverty is DWP’s number one priority; we are reviewing the work of the entire Department to assess what more we can do – and have appointed Lisa Harker to advise us as we develop our renewed strategy.

Engaging Young People

Our efforts must address the key areas of disadvantage that research shows limit young people’s life chances. By renewing our strategy in these areas we can make real and sustained progress towards our ambition of ending child poverty in a generation – breaking the chain of disadvantage for good.

The disability rights movement has a saying – ‘nothing about us, without us.’ I believe that to bring about lasting change – and to truly break the chain of disadvantage which links the generations – the same must be true for the children of poverty. Not least because the parents of the children of 2020 are themselves at school today.

Many of us have our own experiences of child poverty. I want to hear from young people about the impact poverty has on them and what they think Government and others could do to make their lives better. Later this Summer we will be bringing together a number of children from deprived areas of the country for a Summer Seminars here in London – where we will be exploring their perspectives on what poverty means and what can be done to tackle it.

The results will be included in DWP’s renewed strategy – to be published this Autumn – and we will be seeking nominations for participants from, for example, charities, schools and families of children who are living in poverty today.

Closing

Government is well placed to make the economic case for ending child poverty. But young people’s voices are essential to making the social justice case.

The chain of generational disadvantage – reinforced in the 1980s – has been weakened in recent years. But it has not yet been broken. I believe that to break this chain, two generations will have to be freed from it.

Achieving our target of eradicating child poverty by 2020 is the challenge and responsibility of Government. But our approach must be strengthened, not just by popular engagement but by popular refusal to tolerate child poverty in today’s Britain. For this to happen, I believe we must extend awareness of what poverty means to children in Britain today. By helping young people’s voices to be heard – we truly can “make poverty history at home”.

Below is the text of the speech made by Jim Murphy, the then Minister of State for Employment and Welfare Reform, to the Edinburgh Conference on Welfare Reform on 30th October 2006.

Introduction

For too long, too many people have been written off.

That’s why I’m delighted to be here to talk to you about Welfare Reform.

Over the past decade, there has been the greatest extension of disability civil rights this country has ever seen. From establishing the Disability Rights Task Force in 1997 to the Disability Discrimination Act 2005, we have put in place a secure legal foundation of rights for disabled people. Employers and service providers of all sizes are now – almost without exception – subject to the DDA.

In December this year, the public sector disability equality duty will come into force, establishing a variety of obligations for public authorities to actively promote and support equality of opportunity for disabled people.

But we now need to go further. The crucial next step in empowering disabled people is extending their opportunity to work and play a full role in society. The framework of legal protection against employment discrimination is in place – but the support for the people who have until now been written off has been missing.

That is a frank admission that not enough has been done before. But in the past decade we have come a very long way in employment and welfare in the UK.

Legacy in 1997

It is important to remember that:

Not so long ago the UK suffered higher child poverty than nearly all other industrialised nations;

Over a period of 20 years, the proportion of children living in relative poverty had more than doubled and one in three children in Britain was poor;

By 1997, almost 5.5 million people were on benefits, 3 million more than in 1979; and

Over that same period, the number of people claiming unemployment benefits had risen by 50% –and the numbers claiming lone parent and incapacity benefits had more than tripled.

These appalling statistics paint the picture for the country, but they cannot capture the impact on communities, on families, and on individual lives – the neighbourhoods where unemployment and benefit dependency wasn’t a matter of months, or perhaps even years, but of a whole lifetime; a way of life.

And even today a child born into the most disadvantaged 5% of families is 100 times more likely to have multiple problems at age 15 than a child from a family in the most wealthy half of the population.

Progress since 1997

Of course, there has been real progress.

Since 1997, we have tackled worklessness with a strong economy and by investing in Jobcentre Plus and the New Deal:

More people are now in work in the UK than ever before, with more than 2.5 million more people in work than in 1997;

We have the best combination of high employment and low unemployment and inactivity of the world’s major industrialised countries;

Thanks to our reforms to the tax and benefit system, families with children are on average £1,500 per year better off in real terms, and those in the poorest fifth are £3,400 per year better off than in 1997.

Future Challenges

But just because there are no longer enormous marches for jobs, it doesn’t mean that our job is done.

There remain great causes in British public life including eradicating discrimination, ending child poverty and making all our public services world class.

I want to talk about three specific areas today:

– Welfare Reform, in particular our changes to Incapacity Benefit;

– Globalisation and skills; and

– Shaping our services around the citizen.

Incapacity Benefit Reform

It is inactivity – rather than unemployment – that is the principle employment challenge we now face. In the years up to 1997 the number of people claiming unemployment benefits had risen by 50% – but the numbers claiming lone parent and incapacity benefits had more than tripled.

The reasons for people coming onto Incapacity Benefits have changed dramatically since the benefit was first introduced. It was previously considered a legacy of an industrial heritage. But now:

People with mental health problems now account for 40% of the IB caseload – up from 27% in 1997; and

One third of new claimants now report mental and behavioural disorders as their main reason for coming onto the benefit, compared to a fifth back in 1997.

And we know that:

About three-quarters of Incapacity Benefit customers have been on the benefit for more than two years; and

After two years on Incapacity Benefit, a person is more likely to retire or die than ever work again.

But society has changed since incapacity benefits were introduced – and in particular attitudes to mental health and learning disabilities. It used to be thought that work would be the worst thing possible for people – whether they had a bad back or a mental health problem. Now we know that there is:

Strong evidence that work is good for physical and mental health; and that

Work can be therapeutic and can reverse the adverse health effects of unemployment and the damage it does to people’s self esteem.

But our systems haven’t kept pace with these advances in our understanding. We know that barriers still exist and discrimination still goes on. But without the DDA, disabled people wouldn’t have the right in law to challenge unfair treatment.

I know too that disabled people sometimes do face limitations in the sort of activities and work that they are able to undertake. But that’s why the essence of our Welfare Reform proposals is to focus on capability. To look at what people can do, rather than concentrate on what they can’t.

We intend to provide the support that will help those people that can do so, to work:

That’s why our Welfare Reform Bill will replace Incapacity Benefit with a new Employment and Support Allowance;

Turning the current system on its head, we will focus on what steps could help people into work, rather than simply assuming they are incapable of doing so on the basis of a health condition or disability;

We will match this new work focus with greater support for those people for whom it would not be reasonable to require to take steps towards a return to work, giving them a higher rate of benefit, together with the option of taking up the work-focused support on a purely voluntary basis;

But for the majority who – with help – can reasonably build their capacity to work, this support will be coupled with the responsibility to take up the help that is available;

These reforms will be built upon the foundation of our innovative Pathways to Work programme, which provides a holistic approach to tackling the health-related, personal and external barriers people face to returning to work;

And the new Personal Capability Assessment – reviewed by medical experts and stakeholder groups to ensure that it meets today’s needs – will provide Personal Advisers with work-focused health-related assessments for each claimant, so they can tailor packages of help and support for each individual customer.

Globalisation and Skills

Secondly I want to talk about globalisation.

Too often in the past, the conversation about globalisation is about what it means for nations and businesses rather than what it means for citizens.

Today’s young people are the first generation who can truly be said to be competing in a single global economy. Their competitors in the job market are the citizens of China and India, not just their peers from their community, country or continent.

Emerging and developing economies have increased their share of world trade by around a third since 1990;

China is now the sixth largest economy in the world, and is projected to be the third largest within a decade; and

China and India are producing 4 million graduates a year.

There is little future in low-skill employment. Today our economy has 9 million highly skilled jobs – but by 2020 will need 14 million highly skilled workers. And whereas we now have 3.4 million unskilled jobs, it is estimated that by 2020 we will only need 600,000 unskilled workers. This is another reason why we need to build the confidence and skills of the 2.7 million people currently on Incapacity Benefit.

So we need to look ahead and think now about how we can build the highly skilled workforce we will need. The Leitch review of skills will provide us with a valuable starting point. I believe we must build on the remarkable progress made in tackling unemployment by developing new approaches to help customers enhance their skills – considering how Jobcentre Plus can support people in low-skilled, low-paid work to progress in the workplace.

Making an impact through building skills will mean working effectively with a broader range of partners, at national and local level, to develop the kind of innovative approaches that will make a difference and will deliver the capabilities that employers need.

Skills are also crucial if we are to eradicate child poverty. Employment is the most effective route out of absolute poverty. Skills are a major part of eradicating in-work poverty because enhanced skills are the best path to sustained employment and a career.

All the tools of the Welfare State have to be better directed at helping families with children, including refocusing our employment programmes and the delivery of our future reforms, so that helping parents back into work is fully integrated into their objectives and ways of working.

Making further – greater – progress on tackling child poverty doesn’t just mean children’s lives changed for the better now. It’s the most important step we can take to break the chain of disadvantage that traps the poorest and most socially excluded in our society. That chain of family disadvantage which is passed from generation to generation – where each successive generation is a link in that chain. In recent years we have weakened it. But if we are to eradicate child poverty we need to break the chain of disadvantage.

We simply cannot accept poverty as an intrinsic feature of the social landscape of the UK.

That’s why tackling child poverty is DWP’s number one priority;

That’s why we are reviewing the work of the entire Department to assess what more we can do; and

That’s why we appointed independent child poverty expert Lisa Harker to advise us as we develop our renewed strategy – Lisa’s report will be published very shortly.

Shaping services around the citizen

Thirdly I want to talk about shaping our services around the citizen. I believe we must focus relentlessly on the needs and wishes of our customers.

The private sector has revolutionised the way that it does business as a result of the development of ever more powerful IT systems. It’s become the norm for many of us to book our holidays, do our shopping and our banking online. And these innovations have taken off because they meet our need for convenient access to services. I think it is reasonable to talk about Government for a Google Generation. We know that people are more impatient and – I think rightly – more demanding in the standard of services they expect from us.

There has been real innovation in public services. But an enhanced focus on customer services has been slow to reach the poorest people in our communities. Those who, in fact, depend the most on their interactions with public services.

That’s why I’m delighted to announce today a series of changes that will help Jobcentre Plus to provide a better service to our customers at the first point of contact:

We’re establishing 0800 numbers for people making new claims to working age benefits – everything from Jobseekers Allowance and Income Support to Incapacity Benefit;

For the majority of our customers, a single call is now all that will be required to make a new claim;

So there will no longer be a need to await a return call from Jobcentre Plus, meaning that the system will be quicker and customers will spend less time on the phone. Unsurprisingly our customers tell us that they prefer dealing with a single person and not having to repeat themselves;

And because the initial telephone process is quicker, customers get to meet a personal advisor sooner for work-related support and advice – which has to be good news in helping them get back into the labour market!

Such changes can make a big difference – our focus on reforming and renewing the welfare state must be matched with a continuing commitment to getting the details right in our relationship with our customers.

Conclusion

As we look ahead, to the impact of our current welfare reforms when they are rolled out in 2008, and beyond – to the future challenges that will shape our evolving welfare system – it might seem that the only constant is change.

But this change is driven by fundamental – and unchanging – values:

– the commitment to offering every individual and every generation the opportunity and support to achieve their potential; and

– the dedication to tearing down the remaining barriers that still hold people back.

Below is the text of the speech made by Jim Murphy, the then Minister of State for Employment and Welfare Reform, to the 16th November 2006.

Introduction

I’m very pleased to have this opportunity to join you this morning – to offer my support for the invaluable work that so many of you here are doing to tackle homelessness – and, of course, to celebrate the launch of the Transitional Spaces Project.

Why tackling homelessness is so important

Tackling homelessness is about much more than simply putting a roof over someone’s head.

It’s about understanding the causes and addressing the factors that so often lead to homelessness, such as:

– relationship and family breakdown;

– debt and unemployment;

– mental health problems; and

– alcohol or drug dependency.

Tackling these issues helps provide a way back for people on a path to homelessness – helping them to hold on to a place to live even when facing other challenges in their lives.

We know that – if we don’t tackle the root causes – many homeless people can get trapped in a vicious cycle of deprivation; a cycle that eats away at their confidence and self-esteem; a cycle that was so vividly portrayed for the first time 40 years ago today – when the BBC first aired the drama documentary “Cathy Come Home.”

12 million people – a quarter of the British population at the time – watched the story of Cathy and Reg. Initially a happy couple, their lives spiral downwards when Reg loses his job. After periods of squatting, eviction and care homes, finally – on a suburban street in front of astonished passers-by – Cathy has her children forcibly taken away from her by the social services.

It shook the social conscience of a nation. Even as recently as 2000, a British Film Institute poll voted it the 2nd Greatest British Television Programme of the 20th Century.

Progress

We’ve come a long way in 40 years. The Homelessness Persons Act of Callaghan’s 1977 Government finally put a duty on local authorities to find accommodation for homeless applicants. And despite a marked lack of progress in the early 1980s and 1990s – this Government has made huge strides forwards:

Today rough sleeping is down nearly three-quarters since 1998;

We’ve ended the scandal of families spending long periods living in bed and breakfasts;

The number of new cases of homelessness is at a 23 year low – down 29% on the same period last year; and

We’ve set the ambitious target of halving the number of households living in temporary accommodation by 2010 – and have already seen a 7% reduction over the past year.

Much of this progress has been down to many of you here today. A result of ground-breaking partnerships with local authorities and the voluntary sector in tackling the root causes of homelessness.

Key to our success now is preventing people from ever getting onto the downward spiral that can lead to homelessness and despair.

Through our Supporting People programme we are investing more than £5 billion over three years in locally delivered services to help people maintain independent lives through more settled housing.

In the past decade we have doubled the funding for affordable housing and supported the creation of 230,000 new affordable homes.

We’re investing in social housing and increasing the supply of new social homes by 50 per cent by 2008, providing 75,000 new social homes over the next three years.

And, as our response to the Barker Review of Housing Supply made clear – we’re committed to going further and making social housing a priority in the next spending round as well.

Challenge ahead

But we need to go further. We know:

There are still up to 500 people on the streets on a single night; and

More than 90,000 households are still living in temporary accommodation.

The challenges and causes of homelessness are changing. And our response must reflect these new challenges. We know that the single biggest cause of homelessness – accounting for nearly one-in-four new cases – is where parents are no longer willing to accommodate young people; and while one in five cases results from the breakdown of relationships.

That’s why earlier this week the Secretary of State for Communities and Local Government unveiled a package of measures specifically designed to tackle the root causes of homelessness – with a particular focus on the rising prevalence of youth homelessness – and the need for access to mediation services, to try and prevent the breakdown of relationships in families leading to homelessness.

It means saying no to the use of bed and breakfast accommodation for 16-17 year olds, except in emergencies;

It means training community volunteers and establishing supported lodgings across the country – that don’t just provide accommodation – but also advice and mediation services for young people; and

It means making the initial move into supported accommodation a springboard for helping people turn their lives around, not the beginning of a downward spiral of rejection and dependency.

Off the Streets and Into Work (OSW)

As your report “Multiple Barriers, Multiple Efforts” highlighted, tackling homelessness requires a truly joined-up, holistic approach. Not one that tackles each barrier separately.

That’s why it’s absolutely right that Off the Streets and Into Work should be making the connection between homelessness and worklessness. In “Cathy Come Home” it was, of course, when Reg lost his job that Cathy and Reg’s problems really began.

Most of OSW’s clients are unemployed – nearly a third have been unemployed for more than three years.

But we also know that many homeless people aspire to work. Your own survey in May last year (“No home, No job”) – the most extensive study of its kind in Europe – found that 97% of respondents said they would like to work in the future. And over three-quarters wanted to work straightaway.

We need to go further in ensuring that labour market policy is properly joined up with housing and homelessness policy.

We know, for example, that temporary accommodation can attract high management charges and the resulting high rents can be seen as a barrier to employment.

That’s why we’re working with DCLG and OSW to support the Working Future project being tested by the GLA and East Thames Group. One hundred households in temporary accommodation in East London being offered lower rents in return for increased training opportunities and tailored employment support.

We know that voluntary work or work experience plays an essential role in helping homeless people reconnect with work. As one respondent to your survey said:

“It gives you the opportunity to work in areas that you thought were beyond you.”

That’s why it was so important that we listened to you – and changed the rules on volunteers’ lunch expenses – allowing those on benefits to have their lunch expenses disregarded for benefit purposes. To make it easier for people who are on benefits to volunteer – and to take those crucial early steps on the road to work.

As well as the transition into work – it’s clear we also need to shift the focus away from simply getting a job to supporting people to progress in the workplace.

Through Jobcentre Plus and our wider welfare to work strategy – we have invested heavily in helping people find work. Our welfare reforms – the reform of Incapacity Benefit and our investment in the tailored support of Pathways to Work – are renewing a sense of hope and opportunity for those who have been written off by the welfare system for years.

But our future success will hinge not just on getting people into work – but on supporting them to stay in work and to acquire the skills, confidence and ambition to progress though the workplace. This is the new challenge for welfare. Getting people into work is only the start. Keeping them in work and helping them to progress through the labour market must be our objectives.

Our work to transform hostels – including the current £90 million Hostels Capital Improvement Programme – will make an important contribution by making hostels places where people can acquire skills and training to progress in their lives. Ending the “revolving door” of homelessness and helping people to build their way out of poverty and dependency.

Role of Housing Benefit Reform

Housing Benefit also needs to promote work and support a greater independence. Complexity and lack of transparency in Housing Benefit can act as a barrier to work. When payment is made to the landlord it does nothing to help tenants in developing their financial and budgeting skills or their sense of independence.

By contrast, our new Local Housing Allowance – a flat-rate amount based on household size and location – is paid in most cases to the tenant rather than the landlord. It’s already operating successfully for private sector tenants in 18 local authority areas – and we intend to extend it to new customers across the whole private rented sector.

But with 80% of those receiving Housing Benefit living in social housing and the highest levels of worklessness being in this sector – we’re also clear that there’s a strong case for reforming Housing Benefit for social tenants. While that means recognising the significant differences between the private rental market and social housing – we need to find a way of enabling social tenants to exercise a greater degree of personal responsibility in respect of their managing their finances.

Transitional Spaces Project

Even with Government action to increase the supply of social housing, we need to make better use of existing housing stock – including, with adequate safeguards, embracing the possibilities and choices offered by the private rented sector.

That’s why I’m so keen today to launch the Transitional Spaces Project – a new project that will combine an innovative incentive scheme and a transitional support package to link employment with sustainable moves from hostel accommodation into the private rented sector.

Two pilots: one in Tyneside and one here in London – working with 100 people a year over three years.

Not just providing financial support – but practical and motivational support to help with job-search, CV preparation, interview skills, training and mentoring, financial literacy, budgeting and even mediation with employers if needed. Not just working with people to think about employment – but to think about a career.

Not just doing more of what we already do – but doing things differently. Testing the boundaries of what is possible and forming new alliances and new partnerships which themselves can – and I believe must – drive further progress in tackling homelessness.

Conclusion

Because ultimately there can be no place for homelessness in our society.

Forty years ago “Cathy Come Home” – helped change societal attitudes as well as the Government’s approach. Today we’re still talking about it.

Since then – together – we’ve made enormous strides in tackling and preventing homelessness. But there is much more to do. And it is only by continuing to work together that we can help even more people out of a cycle of homelessness and into independent and settled lives.

We need to finish the job. Homelessness has no place in a sustainable community. Like poverty and disadvantage, our aim should be to eradicate it.