Cast aside 'illusions' of lingering on benefits under Labour, says Reeves
The new shadow work and pensions minister has said in her first interview that Labour will be tougher on welfare than the Conservatives.
Rachel Reeves said a Labour government would cut the welfare bill and that ‘nobody’ should be under any illusions that they will be able to ‘linger on benefits’.
Speaking to the Observer on Sunday, former Bank of England economist Ms Reeves said the long-term unemployed would have to take up a guaranteed job offer or lose their state support.
‘Nobody should be under any illusions that they are going to be able to live a life on benefits under a Labour government,’ she said. ‘If you can work you should be working, and under our compulsory jobs guarantee if you refuse that job you forego your benefits, and that is really important.
‘It is not an either/or question. We would be tougher [than the Conservatives]. If they don’t take [the offer of a job] they will forfeit their benefit. But there will also be the opportunities there under a Labour government.
‘We have got some really great policies – particularly around the jobs guarantee and cancelling the bedroom tax – that show that we are tough and will not allow people to linger on benefits, but also that we are fair. Where there are pernicious policies like the bedroom tax, we will repeal them,’ she said.
Labour’s jobs guarantee scheme would offer under-25s a job after one year of unemployment and over-25s will be offered one after two years out of work. Ms Reeves claimed this scheme, which she said would be paid for by a tax on the bonuses of bankers,would take 230,000 long-term unemployed people off benefits.
She continued: ‘Compared with 2010 the government is spending £9 billion more now on social security. More people are long-term unemployed, more people are on housing benefit, and 4.8 million people are being paid less than a living wage, up from 3.4 million in 2009.
‘So you have got more people in work claiming tax credit and housing benefit to make ends meet. You have got a million people on zero-hours contracts… you have got 1.5 million who are working part-time who want to work full-time.’
Ms Reeves hinted that her party would make a manifesto commitment that procurement contracts in the public sector would go to companies which pay a ‘living wage’.
‘You could absolutely do things through procurement. You could make a decision that all your contracts could be living-wage contracts. It is something I think is a good and really exciting idea,’ she said.