Welfare Reform on the Web (September 2003): Social Security - UK

BENEFITS TRAP "BOOSTS BLACK ECONOMY"

D. Turner

Financial Times, Aug. 29th 2003, p.5

Workers in the informal economy miss out on rights to pensions, sick pay, etc, but avoid paying taxes and continue to claim benefits while working. Campaigners argue that in order to persuade workers and the self-employed to join the formal economy, government needs to cut non-essential regulation of micro-businesses and allow people to claim benefits while earning.

ENCOURAGING TAKE-UP OF BENEFITS BY PENSIONERS

Northern Ireland Office

London: TSO, 2003 (House of Commons papers, session 2002/03; HC737)

Describes a range of initiatives to encourage pensioners to claim the benefits to which they are entitled. These include provision of benefits advice in primary care, partnerships with the voluntary sector, simplification of the systems, telephone claims and use of pension advisers.

PEOPLE, PENSIONS AND POST OFFICES: THE IMPACT OF "DIRECT PAYMENTS" ON POST OFFICES AND THEIR CUSTOMERS

Trade and Industry Committee

London: TSO, 2003 (House of Commons papers, session 2002/03; HC718)

Concludes that direct payments of benefits into bank accounts will cause stress to many elderly and disabled people who will find the process of opening an account daunting. People who rely on cash payments as an integral part of their budgeting will also be adversely affected. The primary objective of the new delivery system appears to have been reducing government expenditure, not improving service to the public. Much uncertainty and anxiety is being caused by the government's failure to decide how benefits will be paid to people who cannot operate a bank or Post Office card account.

TACKLING BENEFIT FRAUD

Committee of Public Accounts

London: TSO, 2003 (House of Commons papers, session 2002/03; HC488)

Finds that:

• although losses from fraud and error on income support and Job Seekers' Allowance have been reduced by 24% since 1997/98, they are still unacceptably high;
• local authority administration of Housing Benefit is still unsatisfactory;
• the benefits system needs to be simplified if fraud is to be tackled effectively.