Prime minister confirms coalition will radically overhaul benefit system while speaking on BBC's Andrew Marr Show
- guardian.co.uk, Sunday 3 October 2010 10.48 BST
- Article history
Prime minister David Cameron arrives to speak on the Andrew Marr show at the BBC studios in Birmingham.
David Cameron this morning confirmed that the coalition plans to scrap many existing welfare benefits and replace them with a single benefit. The prime minister told the BBC's Andrew Marr Show that, although the reform would cost money upfront, it would save public funds in the long run.
The Tory leader, whose party conference begins today in Birmingham, described the reforms as an example of his "bold and radical" government. "What we are putting forward is the most radical reform of the welfare state for 60 years ... It will have a transformative effect for people in work and people on benefits."
Cameron said: "We spend billions of pounds on welfare, yet millions are trapped on welfare. It's not worth their while going into work."
He said the reform was a "big, bold change. It does cost some money upfront," and some cuts to the welfare bill to pay for it would be announced in the 20 October spending review, but in time the reform would make great savings for the Treasury. "Over time it has the capacity to save huge amounts of money, because it will end a lot of the fraud, a lot of the error, a lot of the waste, and because it is always worth people going into work."
Under the new plans, "if you can work and if you're offered a job and you don't take it, you cannot continue to claim benefits. It will be extremely tough," he said.
Would it be in place by this time next year? "I believe that is the case, but this is going to take a long time to bring this whole change in, because you are migrating people off a whole range of benefits and tax credits ... on to one single universal credit system."
He denied there would be substantial numbers of losers from the reform.
The shape and cost of the new welfare reforms had been the subject of dispute between George Osborne, the chancellor, and Iain Duncan Smith, the work and pensions secretary, but Duncan Smith appears to have got his way.
Cameron also gave a strong hint that universal benefits such as child benefit could become means-tested under coalition plans. Such spending was no longer "affordable", the prime minister said. "On the one hand we have got to ask, are there some areas of universal benefits that are no longer affordable? But on the other hand let us look at the issue of dependency where we have trapped people in poverty through the extent of welfare that they have."
He went on: "I think it is very important that there are universal benefits. We pay into this system, that is why I want a really good state pension system. We are the first government in a long time to link the pension back to earnings."
Asked if he was against means-testing on principle, Cameron said: "What we basically need is a system that has universal and fair elements that are part of a decent and civilised society, like a good strong pension provision, and then in terms of the work-related benefits you need a system that means you are always better off in work and working hard."
It has been estimated that setting the limit for receipt of child benefit at age 16 rather than 19 would save £2bn a year, and means-testing could produce more savings. But means-testing is criticised for introducing complexity into the system and threatening takeup for lower earners.
Yvette Cooper, the shadow work and pensions secretary, said: "The government is clearly planning a massive assault on families. Cutting child benefit for 16-year-olds will hit hard-working parents who badly want their children to stay on at school. This is an attack on aspiration and on overstretched families who want their teenagers to do well.
"The government is already cutting £3bn from tax credits and support for children. Introducing means-testing for child benefit as well would put many low- and middle-income families off claiming the support they badly need."
Asked about the row over planned defence cuts sparked by the leak of a letter from Liam Fox, the defence secretary, Cameron said: "All these things are ongoing discussions we've got to get right. These are huge decisions but what you've got to do is look at the threats we face today ... We need, in many cases, to make our armed forces more flexible, more adaptable." He said the UK currently had tanks and planes built to fight the USSR. "That's not what you need today ... Of all the things I've inherited as prime minister, this is the biggest mess."
Asked if the government would take a decision on the renewal of the Trident nuclear deterrent within this parliament, or delay it as some Lib Dems want, Cameron said: "There'll be a stream of decisions, some before, some after."
Asked about the new Labour leader, Ed Miliband, the prime minister told the programme: "The big test for him is the deficit. This is the big issue of British politics. They [Labour] don't seem to have an answer at all."
Earlier he had said of the deficit and the budget cuts proposed to deal with it: "Britain's budget deficit is something we can't get away from dealing with. It's like a family's credit card because it gets bigger the more you leave it." He said that when the coalition took power the UK was "being linked with Greece and Portugal", and action had to be taken.
Cameron was also asked about the comments by the justice secretary, Kenneth Clarke, suggesting the UK might fall back into recession. He said: "I look at the forecasts, the forecasts from the Office for Budget Responsibility, the CBI and others, they forecast growth. But yes, it will be a choppy period that we'll go through."
Would that mean the coalition's planned cuts might be amended if the economy went into a double-dip recession? "I don't believe in positing all these conditional questions about the future," said Cameron.
Asked what he had to say to critics in his own party who felt he was too close to his coalition partners, the Liberal Democrats, and not close enough to them, Cameron listed the "referendum lock" stopping powers being transferred to Brussels without a vote and the planned cap on immigration as policies that would appeal to the Tory right.
The Tory leader, whose party conference begins today in Birmingham, described the reforms as an example of his "bold and radical" government. "What we are putting forward is the most radical reform of the welfare state for 60 years ... It will have a transformative effect for people in work and people on benefits."
Cameron said: "We spend billions of pounds on welfare, yet millions are trapped on welfare. It's not worth their while going into work."
He said the reform was a "big, bold change. It does cost some money upfront," and some cuts to the welfare bill to pay for it would be announced in the 20 October spending review, but in time the reform would make great savings for the Treasury. "Over time it has the capacity to save huge amounts of money, because it will end a lot of the fraud, a lot of the error, a lot of the waste, and because it is always worth people going into work."
Under the new plans, "if you can work and if you're offered a job and you don't take it, you cannot continue to claim benefits. It will be extremely tough," he said.
Would it be in place by this time next year? "I believe that is the case, but this is going to take a long time to bring this whole change in, because you are migrating people off a whole range of benefits and tax credits ... on to one single universal credit system."
He denied there would be substantial numbers of losers from the reform.
The shape and cost of the new welfare reforms had been the subject of dispute between George Osborne, the chancellor, and Iain Duncan Smith, the work and pensions secretary, but Duncan Smith appears to have got his way.
Cameron also gave a strong hint that universal benefits such as child benefit could become means-tested under coalition plans. Such spending was no longer "affordable", the prime minister said. "On the one hand we have got to ask, are there some areas of universal benefits that are no longer affordable? But on the other hand let us look at the issue of dependency where we have trapped people in poverty through the extent of welfare that they have."
He went on: "I think it is very important that there are universal benefits. We pay into this system, that is why I want a really good state pension system. We are the first government in a long time to link the pension back to earnings."
Asked if he was against means-testing on principle, Cameron said: "What we basically need is a system that has universal and fair elements that are part of a decent and civilised society, like a good strong pension provision, and then in terms of the work-related benefits you need a system that means you are always better off in work and working hard."
It has been estimated that setting the limit for receipt of child benefit at age 16 rather than 19 would save £2bn a year, and means-testing could produce more savings. But means-testing is criticised for introducing complexity into the system and threatening takeup for lower earners.
Yvette Cooper, the shadow work and pensions secretary, said: "The government is clearly planning a massive assault on families. Cutting child benefit for 16-year-olds will hit hard-working parents who badly want their children to stay on at school. This is an attack on aspiration and on overstretched families who want their teenagers to do well.
"The government is already cutting £3bn from tax credits and support for children. Introducing means-testing for child benefit as well would put many low- and middle-income families off claiming the support they badly need."
Asked about the row over planned defence cuts sparked by the leak of a letter from Liam Fox, the defence secretary, Cameron said: "All these things are ongoing discussions we've got to get right. These are huge decisions but what you've got to do is look at the threats we face today ... We need, in many cases, to make our armed forces more flexible, more adaptable." He said the UK currently had tanks and planes built to fight the USSR. "That's not what you need today ... Of all the things I've inherited as prime minister, this is the biggest mess."
Asked if the government would take a decision on the renewal of the Trident nuclear deterrent within this parliament, or delay it as some Lib Dems want, Cameron said: "There'll be a stream of decisions, some before, some after."
Asked about the new Labour leader, Ed Miliband, the prime minister told the programme: "The big test for him is the deficit. This is the big issue of British politics. They [Labour] don't seem to have an answer at all."
Earlier he had said of the deficit and the budget cuts proposed to deal with it: "Britain's budget deficit is something we can't get away from dealing with. It's like a family's credit card because it gets bigger the more you leave it." He said that when the coalition took power the UK was "being linked with Greece and Portugal", and action had to be taken.
Cameron was also asked about the comments by the justice secretary, Kenneth Clarke, suggesting the UK might fall back into recession. He said: "I look at the forecasts, the forecasts from the Office for Budget Responsibility, the CBI and others, they forecast growth. But yes, it will be a choppy period that we'll go through."
Would that mean the coalition's planned cuts might be amended if the economy went into a double-dip recession? "I don't believe in positing all these conditional questions about the future," said Cameron.
Asked what he had to say to critics in his own party who felt he was too close to his coalition partners, the Liberal Democrats, and not close enough to them, Cameron listed the "referendum lock" stopping powers being transferred to Brussels without a vote and the planned cap on immigration as policies that would appeal to the Tory right.
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