The Centre for Social Justice (CSJ) has calculated that Britain has added an average of 540,000 people to the ranks of out-of-work benefit claimants for every prime minister shown the door since 2019. It warns of a “welfare crisis” which has seen the number of jobless benefit claimants go up by 2.7 million since the year Boris Johnson arrived in Downing Street.
Tax Hikes and Immigration Blamed
Rachel Reeves’s tax hikes on jobs is blamed, but so is a “cross-party failure to manage immigration”. The think tank claims working-age welfare spending is now £4 billion a year more than in 2019 in real terms, with 6.6 million people claiming out-of-work benefits.
Call for Reform from New PM
With the Labour party poised to name Andy Burnham the country’s seventh Prime Minister in a decade, the CSJ – a think tank with which he has had a warm relationship – is urging him to “grasp the nettle of welfare reform” as the “key to fixing broken Britain”.
Sir Iain Duncan Smith, the former Tory leader who chairs the CSJ, said: “Welfare reform takes courage and time. But the rewards are enormous. Getting fewer than one quarter of those on long-term benefits back to work would generate £18 billion – enough to cut taxes by thousands, slash the deficit, or boost defence to 3% of GDP. Even more importantly, it would transform lives forever by extending all the advantages that come with a job. Whoever emerges as the next Prime Minister must grasp the nettle without delay.”
Soaring Costs and Youth Inactivity
Spending on working-age benefits is expected to hit £144 billion by the end of the decade, with sickness benefits driving up costs. The CSJ warns the “crisis is particularly acute among the young”, with one in seven 16 to 24-year-olds not in education, employment or training. It wants the new PM to get a grip on “surging mental health claims” as well as tackling “soaring costs for employers” and “immigration pressures on the labour market”.
The number of 16 to 34-year-olds who are “economically inactive due to a mental health condition” has gone up by 76% since 2019. The CSJ sounds the alarm that the “well-trodden pathway to university is no longer working for many, with 700,000 working-age people with graduate qualifications” now out of work and claiming one or more benefits. It says the average level four apprentice now earns nearly £12,500 more than a graduate from a “low-value university course” – but notes the number of apprenticeships has crashed over the last decade.
Policy Director's Urgent Plea
Joe Shalam, policy director at the CSJ, said: “The Westminster chaos that has come to define the last decade has coincided with rising welfare dependency, growing disillusionment with our education system, and the ensuing scandal of wasted potential. The next occupant of Number 10 must immediately commence a programme of reform, expanding meaningful support instead of blunt welfare payments and building an education system that equips young people for adulthood.”
“If the next Prime Minister wants to succeed where their predecessors failed, they must stop managing decline and start fixing Broken Britain.”
Government Response
The think tank wants the Government to “tighten mental health benefits to more severe cases” – a move it says would save £7.4 billion and allow £1 billion to be used to expand “NHS talking therapies, social prescribing and back to work support”.
A spokesperson for the Department for Work and Pensions said: “This Government is focused on delivering deep structural reforms to the welfare system, and we have already rebalanced the rates of Universal Credit from April this year, so it no longer pushes people towards long-term sickness benefits. While framing the rise as totally due to new benefit claimants does not give the full picture, we are committed to supporting people into work as the most effective way to drive down the benefits bill.”
“That’s why this Government has introduced the youth guarantee, the right to try work without fear of immediate reassessment, and personalised support for sick and disabled people worth £3.5 billion over the parliament.” The department argues that the move to universal benefit from “legacy benefits” means people who would not have previously been included in the figures now show up. It adds that population growth and the increase in the state pension age have also contributed to the rise.
