Unemployed could lose benefits in Jeremy Hunt crackdown

Welfare claimants who “refuse” to engage with their jobcentre or take work offered to them will lose their benefits, under plans confirmed by the chancellor before next week’s autumn statement.

The crackdown, first floated by Jeremy Hunt in his Conservative party conference speech in October, is part of a wider government plan to tackle a dramatic decline in workforce participation since the Covid pandemic.

The chancellor will use his set-piece speech to the Commons on Wednesday to launch a “back to work plan”, with £2.5bn of funding over five years for employment support schemes. The money is intended to help up to 1.1 million people stay healthy, get off benefits and move into work.

Speaking on Thursday afternoon, Hunt said the government wanted to address the “rise in people who aren’t looking for work” to help grow the economy.

“These changes mean there’s help and support for everyone – but for those who refuse it, there are consequences too. Anyone choosing to coast on the hard work of taxpayers will lose their benefits.”

As part of the plan the chancellor will say there will be stricter benefit sanctions for welfare claimants who are judged able to work but who “refuse” to engage with their jobcentre or take work offered to them. The details were confirmed as part of the first in a series of updates from the Treasury before the chancellor’s autumn statement speech on 22 November.

It comes as employers grapple with almost 1m job vacancies, as Britain struggles to overcome one of the weakest jobs market recoveries from the Covid pandemic in the developed world.

Labour market experts roundly criticised Hunt’s focus on tougher sanctions for benefit claimants, saying that further eroding an already threadbare safety net for those in long-term unemployment would do more damage than good.

Speaking after Hunt’s Tory party conference speech, Ben Harrison, director of the Work Foundation at Lancaster University, said: “Pushing people into ‘any job’ will not alleviate worker shortages that some sectors are facing, and the Department for Work and Pensions’ own evidence from 2020 suggests sanctions are not effective and slow people’s progress back into work.”

Official figures show 300,000 people had been unemployed for over a year in the three months to July, while more than 8.7 million working-age adults are classified as “economically inactive” – meaning they are neither in work or looking for a job. As many as 2.6 million are in this position because of long-term ill health, the highest number on record.

Experts have warned that years of underfunding for healthcare and wider public services has contributed to sharp rise in long-term sickness – including the former Bank of England chief economist, Andy Haldane.

The Treasury said £2.5bn of funding would be used to expand four existing employment programmes, building on a £7bn package announced at this year’s spring budget, which included investment targeted at services for mental health, musculoskeletal conditions and cardiovascular disease. The schemes are NHS Talking Therapies, Individual Placement and Support, Restart and Universal Support.