From the TUC

Raise the earnings disregard to reduce benefit fraud

04 Dec 2009, by in Society & Welfare

The Need NOT Greed coalition launched our campaign ask today calling for the government to increase the earnings disregard, the amount of money that can be earned before it is deducted from their benefits, from the current £5 to £50.

The launch received a lot of media attention including a BBC Radio 5 interview (iPlayer) with a person working cash-in-hand and not declaring it, followed by the TUC’s Nicola Smith. The Radio 5 journalist highlighted the problem with the benefits system, how the present inflexible rules were causing people to fiddle the system, leading them to take cash in hand jobs such as the qualified plumber who is struggling to survive financially on the £64.30 he receives per week from his Jobseekers’ Allowance.

Hearing the interview this morning it was clear that this man wanted to work. He is actively trying to set up his own business; get back into work and off benefits. In the mean-time the amount of money he has been given to live off is nowhere near enough.

There are two issues here, firstly the benefit levels for some one on Jobseekers’ Allowance is not enough to survive on. Secondly the welfare system is in itself a barrier to moving into work. The Government response to the campaign ask was a refusal to accept that the earnings limit was a barrier to work. They have already invested £5 billion in training and grants as part of a recession response. However this does not address the structural barriers that remain in the welfare system. The earnings disregard being one of them which has been raised over the years by third sector organisations, local authorities and even other political parties and yet remains untouched for 21 years, since its introduction in 1988.

In their response the Government said that lots of people stay within the rules and do not commit benefit fraud. A lot of our grassroots supporters who are calling for an increase in earnings disregard are not working cash in hand and are living in poverty, solely on what they receive forthrightly from the Jobcentre Plus. However they are often living in severe poverty, finding it almost impossible to make ends meet. A young unemployed person is expected to live off £50.95 per week. Playing by the rules punishes people by forcing them to live in poverty. Our campaign is asking to change those rules, not to ignore the illegalities of benefit fraud. As the unemployed plumber in today’s programme said he just wants to get on with finding work, not to be fiddling the system.

Here are Nicola’s reflections of the programme:

“The interview was based very much on the premise that everyone claiming benefits and working at the same time actively chooses to cheat the system and gain financially – so it was good to be able to discuss the realities of precarious low-paid work, and to emphasise that many people continue with benefit claims through accident or necessity rather than actively desiring to commit fraud.”

To keep up the pressure on government to change the earnings limit to £50 per week for everyone on Jobseekers’ Allowance join us at www.neednotgreed.org.uk

GUEST POST: Maeve McGoldrick is the campaigns coordinator for the national policy team of Community Links, an innovative east London charity working to tackle the causes and consequences of poverty. Maeve has worked on campaigns for the British Youth Council and the mental health charity Rethink. She has worked alongside families experiencing extreme poverty at ATD Fourth World and is currently managing the Need NOT Greed campaign at Community Links. Need NOT Greed is a UK wide grassroots campaign seeking to enable people to make a smooth transition into secure formal work without falling further into poverty, through reformation of the welfare system.

2 Responses to Raise the earnings disregard to reduce benefit fraud

  1. Tweets that mention Raise the earnings disregard to reduce benefit fraud | ToUChstone blog: A public policy blog from the TUC — Topsy.com
    Dec 4th 2009, 4:35 pm

    […] This post was mentioned on Twitter by ToUChstone blog and SSP Campsie, Ian Wardle. Ian Wardle said: RT @touchstoneblog: Raise the earnings disregard to reduce benefit fraud http://bit.ly/4STPtK […]

  2. The PBR, unemployment and poverty policy | ToUChstone blog: A public policy blog from the TUC
    Dec 9th 2009, 4:12 pm

    […] 26 weeks. While wider reform is needed for those working under 16 hours (including revision of the £5 earnings disregard) and on including the additional costs of work (such as travel and food) in ‘better […]