Evidence based policy
Nic Dakin: To ask the Secretary of State for Work and Pensions what evidence he used to determine that planned changes to housing benefit for those out of work for over 12 months will increase employment levels.
Steve Webb: We did not make any specific assumptions about the impact on employment levels of this measure. Research shows that the reasons for long term unemployment are complex. However we believe reducing housing benefit after 12 months will provide an additional financial incentive for jobseekers to take up work.
So the government has no evidence that cutting benefits for people unemployed for more than one year will impact on employment levels, but they are going to cross their fingers and hope that the fear of becoming homeless will force people into work.
In other news, their Universal Credit scheme (which will add nearly £2 billion to the welfare bill) will make 1.4 million people worse off, increase marginal tax rates and reduce work incentives for 1.8 million people, and penalise savers and lone parents. The government is yet to explain how the Credit will interact with housing or caring costs, and they currently plan to require every local council to set its own rules on who is eligible for council tax benefit, which will make the benefits system even more complicated.
And the whole thing relies on setting up an earnings database which tracks people's earnings on a real time basis and which is going to be set up on the cheap after the Treasury slashed the amount of money available for it.