Magazine article Public Finance

Think-Tank Identifies £6.5Bn Benefit Savings

Magazine article Public Finance

Think-Tank Identifies £6.5Bn Benefit Savings

Article excerpt

A government 'of any stripe' should claw back recent benefit rises and restrict child benefits for better-off families to save £6.5bn, a Right-wing think-tank has urged.

Policy Exchange said that £5.1bn of these savings should be used to fund a guarantee that claimants who find part-time work for up to 16 hours a week could keep £92.80 of their earnings before losing benefits. This would improve the present Very poor' incentives for long-term unemployed people to move off benefits and into work.

The remaining £1.4bn savings could be shaved off the £81bn annual welfare bill, the think-tank said in its March 3 report, Escaping the poverty trap.

Lawrence Kay, the report's author and research fellow at Policy Exchange's economics unit, said: 'The choice between leaving benefits and going into work should be an easy one. If we make these savings, we can significantly increase the amount of money benefit Claimants can keep to encourage them to find work, while still reducing the overall welfare bill. …

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