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Chris Grayling: Welfare - The Next Steps

In a speech on welfare reform to the Centre for Policy Studies, Shadow Work and Pensions Secretary, Chris Grayling, said:

"London is one of the most vibrant and thriving cities in the world. The last ten years have seen economic growth and prosperity spread through all areas of our capital city. And the regeneration and job creation will continue with the 2012 Olympics in East London. It's been a decade where there really should have been a job for everyone.

Yet, in the same ten years there have remained serious pockets of unemployment and welfare dependency in those same areas where there have been thousands of new jobs created. In 5 London boroughs one in five working age people is on benefits. Child poverty remains unchanged in London.

For the people that have not shared in the growth of the last 15 years, poverty and deprivation remain endemic. I've met some of those people, trapped in a cycle of worklessness. They are often personable and likeable. But they are also a mile away from the job market - lacking experience, self-confidence, the basic know-how about how to get and hold down a job.

But they have the potential to get there.

In the past ten years far too little has been done to help them break out of a cycle of underachievement. It's not that the work hasn't been there.

Thousands of people have moved into all areas of London from overseas to find jobs. That is part of what makes this city so successful.

But it also demonstrates how badly this government has let down those excluded from the labour market.

Why on earth are we paying out vast amounts of money to keep people out of work, when jobs are there and being filled by people from overseas?

Why has the Government stood idly by while such an absurd situation develops?

I have a straightforward view on this.

Gordon Brown has used migrant labour as the easy policy option.

Migrant workers have helped boost economic growth and his reputation as Chancellor at a time when the economic picture would have been somewhat less rosy without the financial impact of people moving into Britain from overseas.

It's still happening. This year's Budget small print showed that his Government's financial projections still depend on an assumption that more people will move into the UK from overseas to work.

I think Gordon Brown has used the influx of migrant workers as a way of ducking the issue of welfare reform, and as a result has left millions of people stranded in poverty who could and should have been helped back to work over the last decade.

After all his rhetoric on poverty, he has failed to deliver the sea change he has promised. And immigration has provided him with a safety net for the economic impact of that failure.

It's not good enough, and it's time it stopped.

The situation in this country is stark. We are publishing today a series of figures that show in areas right across the country the number of migrant workers who have moved here since 1997 exceeds the total roll of local JSA claimants.

The jobs have been there for all those who could be back in work.

But the Government's welfare policy has simply let those people down.

And Britain cannot afford that failure. Worklessness is a huge blight on our society, and generational worklessness is building a sense of alienation among entire communities around the country. It creates a poverty of ambition which will have the effect of trapping yesterday's, today's and tomorrow's children in a cycle of deprivation from which very few manage to escape.

For all the Government's rhetoric on child poverty, and for all of the efforts to manoeuvre people above the official poverty line by making changes to the tax credits system, the problem of endemic worklessness and its social consequences remains largely untouched.

Gordon Brown likes to boast that he has delivered record employment, that he has cracked youth unemployment, and that things really have got better. The truth, of course, is very different. There are far more young people not in education or employment today than there were in 1997 and more than half the new jobs created since then have gone to migrant workers. The Prime Minister's economic boasts are built on the efforts of migrant workforce, while nearly five million British people remain stranded on out of work benefits.

I see breaking that cycle of worklessness as one of the crucial challenges for the next Conservative Government.

We know that children brought up in workless households are more likely to end up workless themselves, more likely to fail at school, are more likely to be sucked into antisocial behaviour and crime.

Tackling worklessness isn't the only thing we need to do to deal with the social challenges we face, but it is a fundamental one.

That's why in January we published "Work for Welfare", our Green Paper setting out the broad approach we will take in Government to tackling what is one of Britain's biggest social challenges.

In today's speech, I want to set out some further thinking in the development of our proposals and to set out how we will move forward in preparing a plan to start the reform process immediately once we are back in Government.

And at the heart of all that we are doing is a simple proposition.

Our welfare state has to change. It has to become something very different to what it has been in the past.

Its job is to help people when they are down.

But I want to create a Britain where it is no longer possible to spend long periods of your life on benefits at home doing nothing.

Long term benefit dependency destroys lives and undermines us as a nation.

It has to stop.

Now of course there will always be those along side whom the state must stand. There are those with disabilities on a scale that will prevent them from ever working. There are those who provide an invaluable service to our society as full-time carers. There are parents of very young children. Nothing I say today will and should impact on the support that the state provides for them.

But for those who could work, the world has to become very different.

So we plan to change the way our benefits system works for those without work. In future there will be strict conditions on the future receipt of benefits. What I want to see is a situation where everyone who is struggling to find a job, but has the potential to get back into work is taking part in structured and usually near-full-time activity. I want to see them to get up and get out of their homes every day either to take part in personal development activities, work experience or community work.

One of the constant comments from those involved working with the unemployed and workless is that the longer they stay inactive, the more detached they become from the workplace. Motivation ebbs away. The habit of getting up and getting on with it gradually disappears.

I want to build a system where that doesn't happen.

Where it is simply not possible for people to become disengaged.

Where there is always something that needs to be done as a condition for receiving out of work support from the Government.

Now of course we plan to give people a window of opportunity to look for a job.

Particularly where they are entering the job market for the first time in a long time. Or where they tend to move from short-term job to short-term job - even though we'll want to help them find something more long-term.

But we need to halt that cycle of decline that starts as someone waits and hunts for a job that doesn't come.

And for those who are struggling on incapacity benefit, but who could get back to work, we need to get them into an environment where they start to rebuild their confidence and overcome their anxieties.

So we'll pave the way for the creation of a network of back to work centres right across the country. As they do in other countries, we expect they will provide something for claimants to do almost every day. We want them to get people into the habit of being out of their homes and active all the time. I want the culture of stay-at-home benefit claimants to be consigned to history.

The goal will be to ensure that most do find a role within a short space of time.

But it won't work for everyone. There will be some who don't try. There will be others - far more numerous than those playing the system - who are so detached from the workplace that the return to work centres can't get the job done.

That's why the back-up to the return to work process will be long-term community work programmes for those who are not yet ready to re-enter the workplace. The programmes will give them an opportunity to begin to build up skills, starting at a basic level but over the course of the programmes I believe that the experience of being in a working environment will get them into a position where a real work placement becomes a realistic option.

We have now begun discussions with local authorities about how the community programmes will work, and we will publish more detailed proposals later this year.

One group in particular will be the focus of our plans - those under the age of 21.

In Britain today, where jobs aplenty have been created, there is no excuse whatsoever for a young, able-bodied person to be outside the labour force.

But we all know that on a typical working day, you can see young people hanging around in town centres in almost every part of this country.

I talked to one such young man in a centre in Manchester a few weeks ago. He had been in trouble as a teenager, but as he approached his twenties had now decided that he probably wanted a job. But he didn't know how to get one, wasn't hyper-motivated to do so, and no one was taking him by the scruff of the neck and steering him in the right direction.

So he was hanging around on benefits.

That has to stop.

So we plan to introduce much tougher rules for young people under the age of 21 claiming JobSeekers' Allowance. For this group the welfare to work process will start much earlier. There'll be employment "boot camps" and community work programmes for those who don't find a job. Staying at home doing nothing will be a thing of the past.

With a Conservative Government, unemployed young people who don't find a job within three months will be referred automatically to a specialist employment provider, where they will be expected to take part in an intensive programme of work-related activity.

If they spend twelve months out of work, they will then be moved onto a full-time community work programme lasting a further year.

This approach is designed to recognise that whilst young people may not always get the job they want immediately, they are better off in a job and looking to move on, than languishing outside the workplace.

If they drop out of work again there will be even tougher limits on the amount of time they can spend at home on benefits. Indeed many will be referred straight back onto a structured return to work programme or a community work programme. Doing nothing will not be an option.

So they simply won't have a chance to become detached from the workplace and from preparation for work.

This approach marks a radical difference from that of the Government. Under their plans, young people will wait a year before they are included in any kind of substantial return to work programme. And then, if they get a job and lose it again, they will wait up to another six months before going back on the programme.

Then, of course, there are those who play the system and sign off benefits just before the deadline for joining the New Deal - and then move straight back to the start of the process again by signing on again a short time later.

I want that to stop. Under our proposals, there will be no room for that kind of manoeuvre. In that situation, the clock will simply be frozen. It won't be reset to zero again.

With this approach, for those who are struggling, there will be real help. For those who are not, there will be no opt-outs. And we will end the street-corner benefit culture among young people which this Government has left to fester for the past eleven years.

Our proposals will also target specialised support at those with specific barriers to work in our society.

We will make it mandatory for everyone leaving a custodial or community sentence, who doesn't have a job to go to, to join a structured return-to-work programme on the day of their release.

Re-offending is one of the big challenges we face in our criminal justice system. Getting offenders back into work quickly is one important part of dealing with the challenge.

We will also target support at those who are struggling in the job market because of a lack of language skills. The contracting structure we establish for the back to work providers will reflect the need for basic language training as an essential part of getting those people into work.

So we expect to see the back to work centres offering English language coaching to particular groups of job seekers' either in their own right or in partnership with local colleges.

The Government's own research has shown that the employment rate for some ethnic minorities is far below the national average, citing language barriers as one of the factors. It's time serious steps were taken to address that problem.

Our challenge now is to turn this approach into a practical plan for Government.

This year we are shaping our thinking on some of the finer details, like the contracting structure that will deliver change most effectively.

We need to review and reform the appeals structure for benefit claimants. It is a matter of huge frustration to Job Centre professionals that if someone objects to a benefit sanction, then everything grinds to a halt for months until eventually a decision is taken.

We will change that. We need an appeal system that is almost immediate, and which ensures that tough messages about the need to participate can be backed up by real action against the minority who refuse to take part.

We will assess all of the current Government's programmes, to see what we can build on and what will need to be modified. Too much of what is happening at present is being dictated and micromanaged from the centre. We need a fresh approach that gives the people providing the support on the front line the greatest possible flexibility to shape programmes that will work.

But above all we will need the ability to put our feet hard on the accelerator. We keep getting rhetoric from the current Government, but little substance to back it up. So they say they will copy our plans to carry out independent medical assessments on all Incapacity Benefit Claimants. But there are no planned additional places on return to work programmes to back up that plan. Which is utterly absurd, and makes the assessment process pointless.

We will have to do much better than that, and we will have to deliver change quickly.

That's because we do not buy into the Government's strategy of using migrant labour to paper over the cracks. I think it has been a disgraceful cop-out that has lasted a decade and has put all kinds of pressures on our public services and our infrastructure. It has also abandoned generations of British people to a life of poverty in so many of our towns and Cities.

The next Conservative Government will change that. We will start managing immigration and the migrant worker process properly, with controlled borders, controlled immigration and proper controls on process like handing out national insurance numbers willy nilly to anyone regardless of their right to work here.

And we will do the job on poverty that this Government has failed to deliver - with a clear plan to tackle the blight of worklessness. It is the Conservatives today who have the ideas and the ambition to tackle poverty and inequality, and to unlock the social mobility that has stalled under Labour.

To do that Britain desperately needs a new kind of welfare state.

One where we help people when they are down, and they work to get back on their feet.

And where a life at home on benefits doing nothing becomes a thing of the past.

That's the change we will deliver."

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