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New benefit proposals 'of little relevance'

Reform of the benefits system is of little relevance to the present employment crisis in the UK, it has been claimed.

Nigel Meager, director of the Institute for Employment Studies, said that longer-term issues such as the reform of this key area will have to wait until the present issue of growing unemployment is tackled.

Mr Meager argued that while recommendations for reform will help in the long term, a lack of demand for unskilled labour in the UK is one of the key issues which needs to be tackled first.

He commented: "As experience with the tax credits system has already shown, tackling the unemployment trap at the bottom of the system can lead to disincentive problems further up the ladder when the benefits or tax credits are withdrawn."

According to a new report by think-tank The Centre for Social Justice, those who are currently living on benefits should gradually have these reduced, while in the meantime, subsidies for low-paid workers should be increased.