Welfare Budget Still on the Rise, Admits Duncan-Smith

REUTERS/Toby Melville
REUTERS/Toby Melville

They’ve been accused of enacting “swingeing”, “crippling” cuts on the backs of the poorest in society, but an announcement by Iain Duncan Smith today revealed that the welfare budget has in fact grown under the Conservative-led coalition government.

Since 2010, the government’s welfare policy has been characterised by its detractors in terms of poverty creation and miserly thrift. “Despite the fact that the UK is a much wealthier country, levels of deprivation are going back to the levels found 30 years ago,” warned a report by six universities in 2013.

Cuts to welfare spending amounted to “an early Christmas present from the government for loan sharks and payday lenders,” lamented a Labour councillor last December.

“Crippling Tory welfare cuts will hit one million children and 600,000 hard-pressed working families in Scotland” cried the Daily Record last October, quoting an SNP member of the Scottish Parliament as saying “These cuts are nothing more than an attempt to punish vulnerable people and to balance the books on the back of the working poor … The Westminster establishment has shown time and time again that it can’t be trusted on welfare.”

“Disabled people and their families are struggling to make ends meet and feel increasingly nervous about the future,” warned a 2012 report by the Hardest Hit campaign, run by a number of disability charities. A spokesman for the campaign told the BBC “Disabled people, those with long-term conditions and their families are already at risk of hardship and face massive barriers to getting into work and education. Cuts to the support they depend upon risk pushing them into poverty, debt and isolation.”

Yet despite all the rhetoric, Iain Duncan Smith will admit in a speech that the welfare bill is still on the increase, albeit at the slowest rate since the welfare system was created, rising by 0.5 percent in real terms year on year.

He plans to use the slowdown in spending to attack Labour, who he claim will return to “reckless spending”. “As we look back over the course of the Parliament, figures show that the growth in welfare spending has been at its lowest since the modern welfare state was created,” he plans to say.

When Blair came to power in 1997, welfare spending was £197 billion in today’s prices, according to the Telegraph. By 2010, that had risen to £202 billion. Since the coalition came to power, spending has again risen in real terms, to £207 billion a year.

Mr Duncan-Smith will use his speech to make the case that more spending doesn’t equal better outcomes. “The challenge has been to disprove the accepted wisdom of the Left: that poverty is solely about money, and more state money solves it. Thus followed the simplistic logic that had driven social policy for too long: more money equals good, less money equals bad. This logic was the driver of the last Government’s failed poverty strategy,” he will say.

According to figures from the Department of Work and Pensions, there are now 700,000 fewer people in workless households than there were when the coalition took the reins, and 270,000 fewer people living in social housing without work.

However, Labour plans to undermine the figures by attacking the government over low paying jobs. Rachel Reeves, the shadow work and pensions secretary, is set to hit back saying “The Government’s failure to make work pay has meant they are struggling to keep social security spending under control.”