• The UK’s welfare system is in a parlous state, beset by ineffective policies, a culture of dependency, and an ever-increasing price tag. While well-intentioned, recent reforms such as Universal Credit have done little to change this. We must seek more radical reforms to shore up the UK’s welfare system and boost employment.
• This in mind, the UK should adopt a 5 year time limit on all out-of-work benefits, with payments withdrawn incrementally to avoid a ‘cliff at the end of the period’.
• We can look to President Clinton’s reforms of the 1990s for evidence of time limits’ effectiveness. Clinton’s Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) saw a 6–7% fall in unemployment counts, a decrease in benefits caseloads by 96%, an unprecedented increase in female employment, and a reduction in government spending by an estimated $54.2 billion between 1996 and 2002.
• While they are no panacea, combined with investment in re-training and up-skilling, time limits on welfare would be a significant step towards fixing the UK’s distortional welfare system and breaking the cycle of learned victimhood.

Read the report.

This book is an analysis of progress – its meaning, its constituent elements, the conditions that favour it, and the methods people use to achieve it. Its central theme is that progress implies a closer approach to nominated goals; there must be a target to make progress towards. Alternative attempts to achieve progress are tested against each other, and new attempts are tested against old ones. The ones which prove better than their rivals at achieving progress towards chosen goals are retained, and inferior alternatives are discarded.

Read the book.

You can buy your copy of Trial and Error here

• It isn’t greedy employers, but greedy government, that is keeping people in inwork poverty; without tax on low earnings even workers on the 2015 minimum wage would earn a living wage.
• The government should raise the national insurance contributions (NICs) threshold along with the income tax threshold to let workers keep more of what they earn—without tax 37.5h on the minimum wage would give workers just 32p/h (or £670/year) less than the living wage.
• Employer-side NICs fall partly on employment and partly on workers’ wages— cutting them should also be a governmental priority.
• Unconditional benefits paid to those in work are not a subsidy to employers, in fact they may induce employers to offer higher wages; those such as tax credits go mostly through to higher wages. Rothstein (2010) estimated that in the United States 73% of the Earning Income Tax Credit went to the worker.
• Even if the minimum wage for the over-25s were increased to £9/hour under the current tax system, take home pay will be only 69p/hour above the untaxed level of the 2015 minimum wage. This difference will become even less significant considering planned increases in the minimum wage in the coming 5 years.
• Instead of imposing a mandatory National Living Wage, the Chancellor would have done better to remove taxes from the lowest paid, giving workers a similar level of post-tax income while forgoing the 60,000 higher unemployment and £1.5 billion lower GDP that the Office for Budget Responsibility predicts will accompany his plans.

Read the report.