Benefit curb on bigger families: Payouts could stop at three children under PM's welfare vision

Benefit curb on bigger families: Payouts could stop at three children under PM's welfare vision

• Families could be removed from the dole after two years
• PM will use speech to suggest Britain follows America's tough benefits rules
• Maximum housing benefit could be slashed from current limit of £25,000
• Ideas lead to claims he has abandoned 'compassionate Conservative mantra'
• 'Taxpayers think carefully about how many children they can have - those not in work, do they do the same thing?' Iain Duncan Smith said today

By Tim Shipman

PUBLISHED: 17:44 EST, 24 June 2012 | UPDATED: 09:27 EST, 25 June 2012

David Cameron is set to announce proposals to penalise jobless families for having more than three children

Jobless families could be penalised for having more than three children under Tory plans for a welfare revolution.

They could also be kicked off  the dole after two years in proposals to be outlined today by the Prime Minister.

David Cameron will claim that there is a ‘welfare gap’ in Britain, where those on the dole have a financial incentive to breed while those in work are forced to stop having children because they simply cannot afford to.

He will float the idea that workshy  couples could be penalised by having their income support slashed and additional child benefit stopped if they have more than three children.

He will also suggest that Britain adopts America’s tough benefits rules which see the unemployed forced to work and even automatically stripped of payments after two years out of work.

Stressing the virtues of ‘self reliance’, Mr Cameron will say: ‘Quite simply, we have been encouraging working-age people to have c hildren and not work, when we should be enabling working-age  people to work and have children. So it’s time we asked some serious questions about the signals we send out through the benefits system.

‘Yes, this is difficult territory. But at a time when so many people are struggling, isn’t it right that we ask whether those in the welfare system are faced with the same kinds of decisions that working people have to wrestle with when they have a child?’

But Mr Cameron will reject growing calls to raid universal pensioner benefits, such as free bus passes and TV licences and the winter fuel allowance, which remain popular with the middle class.

Other measures being considered include forcing the unemployed to work for free in exchange for benefits and removing Housing Benefit from under-25s, as the Prime Minister revealed in an interview with The Mail on Sunday.

The maximum amount of Housing Benefit a family can claim could also be slashed fro m the current limit of £25,000 a year. Downing Street sources say the Prime Minister will seek to advance this agenda through the Coalition, but the reality is that he will meet fierce resistance from the Lib Dems. Instead, the measures are likely to form the centrepiece of a Tory manifesto at the 2015 election.

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Mr Cameron will say: ‘If you are a single parent living outside London, if you have four children and you’re renting a house on Housing Benefit, then you can claim almost £25,000 a year. That is more than the average take-home pay of a farm worker and nursery nurse put together.

‘We have created a welfare gap in this country â€" between those living long-term in the welfare system and those outside it. This has sent out some incredibly damaging signals. That it pays not to work. That you are owed something for nothing. It created a culture of entitlement.’

In 2010, Culture Secretary Jeremy Hunt provoked a row when he suggested that the workshy should stop having children if they cannot afford them, saying the number of children is a ‘choice’.

Today Mr Cameron will point out that there are more than 150,000 people who have been claiming Income Support for over a year who have three or more children and 57,000 who have four or more.

It remains unclear, however, exactly what ministers would do to ensure a child did not suffer if he or she was the fourth or fifth born. One idea is to improve school meals and early years education to the point where the less well-off benefit hugely.

Mr Cameron will also cite the experience in America, where people are forced to work for benefits and do not get them indefinitely.

A No 10 source said such ‘time-limiting’ could potentially apply to many benefits. ‘David will say we should look at time limiting benefits. In America they say, “Sorry, you have it for two years and then you’re on your own”.’

In Wisconsin, when benefits claimants were told they would get no handouts after two years on the dole, the number of claims dropped by 57 per cent. When that state introduced ‘workfare’ schemes to ensure claimants did something useful for their benefits, claims dropped by 80 per cent.

Mr Cameron’s decision to float such controversial ideas is likely to lead to claims that he has abandoned the ‘compassionate Conservative’ mantra with which he won power. But he is keen to create clear blue water between the Tories and the Lib Dems as the Coalition enters the second half of the Parliament.

The Lib Dems said they would not support the plans but were content with Mr Cameron floating Tory ideas.

Work and Pensions Secretary Iain Duncan Smith said this morning the housing benefit payment system for under-25s would probably be restricted rather than eradicated altogether.

'The details of these, of course, we have to be careful about. We have to be sensitive to the different reasons people have housing - people coming out of care, being in difficulties in foster care,' he told BBC Radio 4's Today programme.

He added: 'He's (David Cameron) looking, quite rightly, at the balance between those families that work and try and do the right things against those families that aren't necessarily working and have understood how to w ork the system.

'We want to understand to what degree families realise they can get their children into social housing by getting them out of home.'

On the question of the number of children in jobless families he said: 'I think it’s a genuine and reasonable question, and most people out there will want to ask it: It is this issue of fairness â€" taxpayers are working hard and thinking carefully about how many children they can have, and others who are not in work, do they do the same thing?'

Liam Byrne MP, Labour’s work and pensions spokesman, said: ‘This is a hazy and half-baked plan when we need a serious back-to-work programme for young families.’

PRIME MINISTER'S BACKING FOR O-LEVELS

David Cameron has backed Michael Gove’s plans to scrap GCSEs and return to rigorous O-level exams at 16.

The Prime Minister said he is ‘right behind’ the Education Secretary, despite abuse from t he Lib Dems.

Senior Government sources say the Lib Dems hope to strike a deal with Mr Gove that would see him axe the second part of his plan â€" a CSE-style exam for the 25 per cent of least able pupils.

Full support: Cameron has thrown his weight behind Education Secretary Michael Gove

He may be prepared to abandon the two-tier system in favour of pupils of different abilities sitting different papers of the same exam, in order to achieve the rest of his proposals.

But Mr Cameron delivered a rebuke to those, such as Nick Clegg, who say Mr Gove wants to return education to the 1950s, insisting the Government would not put up with sub-standard schools.

He said: ‘We just aren’t prepared to put up with second-rate standards in state schools.
‘Michael has the courage to deliver it and I back him all the way.’

The Department for Education is also plotting to axe the national curriculum and have just one nationwide exam board in each subject, to stop companies touting for business on the basis of who has the easiest exam.

A YouGov poll found 50 per cent of voters back a return to O-levels, with just 32 per cent opposed. Some 75 per cent back a single nationwide exam.

But Mr Clegg says plan s to earmark pupils for a simpler or more vocational exam  at 14 will be divisive and hold some back.

Mr Gove’s aides were yesterday adamant he would not be compromising. ‘We are full steam ahead,’ one said.

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