It is time for political parties to be brave and honest. Our welfare spending is not sustainable.
Britain’s finances are not sustainable. Our debt levels are the highest they have been for over 60 years, our taxes are at record levels, and we cannot currently find the resources necessary to protect our national security. Something has to give.
A serious analysis of the situation will conclude that we need to look again at welfare expenditure.
According to the Office for Budget Responsibility (OBR), total welfare spending is forecast to rise from £314.7bn in 2024-25 to £406.2bn in 2030-31. As a share of GDP, total welfare spending is forecast to increase from 10.8 per cent in 2024-25 to 11.2 per cent by 2030-31. If we look only at spending on health and disability benefits, it will rise from £76.8bn in 2024-25 to £109bn in 2030-31. This increase in health and disability benefits alone is broadly similar to the entire Home Office budget. Or, to put it another way, it is comparable with the revenue raised by 3 or 4p on the basic rate of income tax.
Pointing this out is easy, however. The hard task is identifying precisely what to do about it. In that context, Prosper UK has set out detailed proposals as to how we can control the welfare bill.
Prosper UK is a centre-right political movement that believes in facing up to the real choices the country faces. This means accepting the trade-offs and being transparent about the tough decisions that need to be made. Labour failed to do that in opposition, and the populist right – in the shape of Reform UK – is doing that today.
So what would Prosper UK do? We have set out a series of proposals that would control public spending but still provide support for those most in need. We would tighten up access to health benefits with more face-to-face assessments and a greater focus on a “work first” approach; bring back a reformed two-child benefit cap; raise the savings cap in universal credit so that this system is not unduly harsh on those who have a relatively small amount of savings; increase the sharing of data across DWP and HMRC; and use data analytics and AI to reduce fraud and improve personalised support.
