Ed Miliband MP, Leader of the Labour Party, will tomorrow (Thursday) endorse the key principles in IPPR’s Condition of Britain report for building a more equal and successful country through big reforms - not big spending.

Speaking at the launch of the report in London, he will back progressive One Nation welfare reforms which, without increasing government spending, will reward people who work hard, improve skills and make a contribution.

These measures, designed to underpin other big reforms in Britain’s economy already set out by Mr Miliband, will help tackle root causes of problems which have been stored up in our society for too long.

They include:

• Ensuring young people get the support they need to improve skills so they get ready for the world of work - instead of moving in and out of low-paid jobs and benefits
• Giving greater recognition to contribution in the social security system
• Handing power back to local communities so they can invest in bricks and mortar - instead of housing benefits

EXTRACTS AND SUMMARY

He will say that, in a post-Crash era when budgets must be tightly controlled and people are sceptical of any government making a difference, make do and mend policies that are simply about extra spending or borrowing are neither available nor adequate to meet the scale of the challenge. Instead, a One Nation Labour Government would address challenges facing Britain with big changes, not big spending.

Mr Miliband will say:

“We face an economy where inequality is rising, year after year, and where so many people feel locked out of the chances that previous generations enjoyed. Turning that round is the mission of the next Labour government.

“And we must do so at a time when our country continues to confront a fiscal situation the like of which we have not seen for generations, the result of a financial crash the like of which none of us have ever seen.

“So we can’t just hope to make do and mend and we can’t just borrow and spend money to paper over the cracks.

“Instead, we need big, far-reaching reform that can reshape our economy so that hard work is rewarded again, rebuild our society so that the next generation does better than the last, and change our country so that the British people feel it is run according to their values. That kind of reform is going to be tough but it is the way we change Britain.

“The importance of this report is that it shows there is a distinctive and compelling answer to addressing the longstanding failures of our country which mean big changes, not big spending.”

Mr Miliband will support IPPR proposals to ensure that young people aged 18 to 21 who lack the skills needed to get a decent job are in training and not on benefits.

He will say their entitlement to adult out-of-work benefits, including Job Seekers’ Allowance, would be replaced with a parental means-tested youth allowance conditional on them being in training.

This would end the injustice of support being denied for young people not at university who are doing more than 16 hours-a-week training or further education. The reform is intended to complement measures already announced by Labour to transform vocational education and raise standards of training for the “forgotten 50 per cent” of young people who do not go to university. 

He will say:

“We must reshape our social security system so that it does everything it can to get people into decent jobs and the world of work not a life on benefits.

“And yet the perversity of the system means that the one thing we most discourage those young people from doing is getting the skills they need for a decent career. The system is telling them that they should sign on for benefits not sign up for proper training but at the same time, it is saying to those who go to university that they are entitled to financial support.

“There can be no better example of a divided country which seems to value the 50 per cent of young people who go to university more than the untapped talents of the 50 per cent of young people who don’t.

“Business won’t succeed unless we equip them with the skills they need to succeed. Young people won’t succeed unless with the skills they need to succeed. And Britain won’t succeed because it costs the taxpayer billions of pounds in extra welfare spending and lower productivity. We need to be One Nation, not two.

“What the IPPR proposals show is that we can address these issues in a way that is progressive not punitive. Britain’s young people who don’t have the skills they need for work should be in training not on benefits.”

Mr Miliband will say Labour will begin to restore the principle of contribution to the heart of the social security system.

He will say that, as a first step, Labour would introduce a higher rate of JSA to those who have contributed over years. This would be fully funded by extending the length of time people need to have worked to qualify.

He will say:

“It is a principle deeply felt by the British people that people should get something back for all they have put in and not get something for nothing. That’s why people have such commitment to the idea of a proper basic state pension, so that there can be dignity for working people in retirement. And why people are proud that we support those who bring up families, through maternity and paternity leave and pay, child benefit and child tax credit.

“But people also know that the principle of contribution has been eroded over the years with less than 10 per cent of social security spending outside pensions goes on contributory entitlements today.

“And, although it may not be realistic to change the system in its entirety, I do not believe we should allow the contributory principle to recede still further. Instead, we should strengthen it.

“That’s why the next Labour government will change the way Job Seekers’ Allowance operates to make sure that someone who has been working for years and years and paying in to the system gets more help if they lose their job than someone who has been working for just a couple of years.

“And we will pay for it not by spending more money in social security system overall, but by extending the length of time people need to have worked to qualify.”

Mr Miliband will say Labour will hand power back to local communities so they can tackle other deep-rooted problems like the shortage of homes that is contributing to the cost-of-living crisis and driving up welfare spending.

“We cannot bring the change we need simply by pulling levers at the centre by relying on Whitehall and Westminster. We can only do it by devolving power drawing on the expertise of the British people themselves.

“That’s why I have called for people-powered public services, giving more powers to parents in shaping the future of their schools and patients in shaping the future of their hospitals. And it is also why I support this report’s call for power to be devolved down to the most local level possible. The last few years have shown that no-one has done better at doing more with less than local government - whether that is getting work for our young people or investing in housing.

“We have a historic problem in Britain, a problem which has developed over decades: a housing benefit bill going up and up and investment in housing itself falling further and further. Higher housing benefit spending is not a sign of progressive success. It is a sign of failure.

“We can start to turn this around and answer the questions people have about whether we can tackle the housing crisis including by devolving more powers to local authorities so that they can reduce the housing benefit bill and keep some of the proceeds to reinvest in housing in their own communities.”