IDS: Welfare Reforms Won't Cut Benefit Bill

Iain Duncan Smith has admitted that controversial welfare reforms due to come in next week will not cut Britain's benefit bill.

The Work and Pensions Secretary said that, unlike other European nations, the "reality is that this country is not cutting welfare" because he is simply "managing" the increase in handouts.

He added that "all those on benefits will still see cash increases in every year of this Parliament".

Mr Duncan Smith's comments to the Daily Telegraph are the first public admission that the Government is no longer seeking to cut the welfare budget.

Previously, ministers have repeatedly spoken about bringing the welfare system "under control".

A Government source told the newspaper: "Despite all the rhetoric about cuts, Iain Duncan Smith is simply finally actually saying what is happening. Welfare is rising."

As the Government faces more criticism from charities over the shake-up - which will see big changes to payments such as housing and disability benefits - Mr Duncan Smith defended the Government's reforms.

"If you listen to what I am saying, you will understand the reality is that this country is not cutting welfare, it is managing the growth at a lower level," he said.

Iain Duncan Smith says those on benefits will see cash rises

He contrasted the British situation to that in Ireland, Spain and Portugal.

"Across the UK - contrary to the headlines - all those on benefits will still see cash increases in every year of this Parliament," he said.

"In the face of the global financial crisis and the country's plummeting GDP, Ireland's leaders have had to implement difficult public spending cuts.

"Doing so has hit benefit recipients hard with social welfare cuts of around £680m for the year 2010, and £780m for the year 2011.

"For a workless couple with two children, this equates to an actual cut in income of around £900 a year."

The coalition welfare changes include cutting the housing benefit of social housing tenants deemed to have a spare bedroom, a move that has been dubbed a "bedroom tax" by Labour. It will hit 660,000 households with an estimated average loss of £14 per week.

Council tax benefit, which covers some or all of the cost of the bill for struggling families, will be replaced by a new system that will be run by English local authorities but on 10% less funding.

Pensioners are protected under the changes but that is expected to mean a bigger burden on poor working age adults.

According to the charity Crisis, the raft of reforms will heap misery on the UK's poorest families, leading to increased queues at food banks and further homelessness.

Millions of homes will be hit by the combination of reforms that comes in from April, with low-paid workers, the unemployed and disabled people bearing the brunt of the cuts, it added.

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