Conservatives Propose Limiting Welfare for Long-Term Unemployed

The Conservative party has announced proposals that would prevent long-term unemployed individuals from spending their welfare payments on alcohol, cigarettes, and gambling. Under the proposed plan, claimants who have been unemployed for more than six months could have their Universal Credit reduced by 30% if they have not previously contributed sufficiently to the system, despite being deemed capable of working.

The reduced benefit amount would be issued via a "Back to Work" card, which would not permit cash withdrawals or spending on restricted items. The party stated that these measures are intended to incentivize people to return to work and to reduce the national welfare expenditure.

Economists estimate that these changes could move approximately 350,000 claimants to the lower benefit rate, resulting in an annual saving of around £538 million. The proposal outlines that individuals deemed fit for work would receive six months of full benefits to find employment. For every two years a claimant has previously worked, an additional year at the full Universal Credit rate would be granted. However, those who have not contributed enough work history would be moved to a "Subsistence Allowance," equivalent to 70% of the full rate. This system is designed to protect individuals with a strong employment record, such as a long-serving employee who becomes redundant.

Individuals who are sick, disabled, or already employed would be exempt from these restrictions. The Conservatives argue that placing the "Subsistence Allowance" on a pre-paid card with spending limitations would ensure that taxpayer money is used for essential needs like food. Conservative leader Kemi Badenoch described the current system, where an individual capable of working receives more benefits than someone employed, as "unfair." She stated, "The best welfare is a well-paid job. So, we will be tough on those who exploit the system because the current system is unfair to workers, taxpayers and those who truly need support."

Conversely, critics have voiced opposition to the plan. A spokesperson for the Labour Party called the scheme "unworkable," asserting that the Conservatives have failed to implement meaningful welfare reforms during their 14 years in power. Helen Barnard, director of policy and research at the anti-poverty charity Trussell, characterized the proposals as "deeply misguided," noting that Universal Credit already falls short of covering essential needs and pushes individuals towards food banks.

Robert Jenrick, economy spokesman for Reform UK, commented that the Conservatives' record on long-term benefits means these proposals would not significantly impact the welfare bill. This initiative follows previous Conservative pledges, including scrapping Personal Independence Payment for certain mental health conditions and making it more difficult to claim sickness benefits, with the stated aim of increasing workforce participation. Government figures forecast welfare spending to rise to £408.6 billion by 2030/31.