Dynamic Benefits Towards welfare that works A Policy Report from the Economic Dependency Working Group

A Policy Report from the Economic Dependency Working Group – leading on to the development of Iain Duncan Smith's plans for "Universal Credit"

Dynamic Benefits Towards welfare that works

Contents

Preface by Iain Duncan Smith 4
The Economic Dependency Working Group Members 10
Executive Summary 14
Foreword by Stephen Brien 33

PART I: The Benefits System 41
Chapter 1: Poverty, Worklessness, Dependency 43
Chapter 2: A Large, Cumbersome Net 54
Chapter 3: “Why Should We Work?”: (Dis)incentivising Work 82
Chapter 4: Unfair and Unwise 104
Chapter 5: The Burden of Complexity 130
Chapter 6: A Manifesto for Benefit Reform 148

PART II: Better Benefit Design 153
Chapter 7: The Dynamic World View 154
Chapter 8: The Principles of Dynamic Modelling 157
Chapter 9: Objectives and Choices 172
Chapter 10: Framing the Benefits System 188
Chapter 11: Why We Need the Dynamic Welfare State 206

PART III: Dynamic Benefits in Action 209
Chapter 12: Policy Design Using a Dynamic Benefits Model 211
Chapter 13: Promoting Work, Reducing Poverty: Options 213
Chapter 14: Reducing the Couple Penalty: Options 247
Chapter 15: Simplification: Options 256
Chapter 16: The Universal Credits Scheme 264
Chapter 17: Assessing the Universal Credits Scheme 293
Chapter 18: Implementation and Outstanding Issues 303
Chapter 19: Concluding Remarks 306

Appendix A: Analysing the Barriers to Work: Case Studies 310
Appendix B: Fair for All? 321
Appendix C: Income Effects on Work Decisions 323
Appendix D: The Dynamic Benefits Model: Details and Calculations 325
Appendix E: Simple Optimisation Model 328
Appendix F: Detailed Impact Analysis 338
Appendix G: Indirect Financial Impact of Our Reforms 349
Appendix H: Alternative Reform Options 352

September 2009 'Centre for Social Justice'