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The Coalition's crackdown on welfare abuse is welcome but Cameron needs to focus on the three pathways out of poverty

By Tim Montgomerie

Welfare reform was promised by Tony Blair in 1997 and was a potent message for David Cameron during this year's General Election. The task was too much for Blair and his Welfare Reform Minister Frank Field. Field was sunk by Gordon Brown's Treasury. Some fear that history may be repeating itself with today's Treasury under George Osborne locked horns with Iain Duncan Smith's Department for Work and Pensions. Cameron, however, in articles for Sunday's Times and in the Manchester Evening News today, appears to be siding with the IDS camp and the belief that not-to-reform is the greater risk. ""Welfare and tax credit fraud and error costs the taxpayer £5.2billion a year," he writes today; "That's the cost of more than 200 secondary schools or over 150,000 nurses. It's absolutely outrageous and we cannot stand for it."

Capturing today's headlines is the recruitment of the credit reference agency Experian. Experian and other credit monitoring companies will be enlisted to see if benefit claimants are spending large amounts of money on, for example, foreign holidays. Claimants travelling abroad or buying expensive consumer durables will then be asked to justify their need for financial help. At least £1bn could be saved by these checks it is estimated and the private sector 'bounty hunters', as The Telegraph calls them, will receive £50m reward payments if they hit these targets. Some may see civil liberties issues in these checks but any such attacks from Labour will be blunted by the fact that the Brown government had also started to enlist Experian but the Coalition is determined to make wider use of their services.

These plans to save money sound credible but the real savings will come not by better enforcement of Brown's complex welfare system but by a radically simpler benefits system that is (a) simpler to access and administer and (b), even more importantly, creates the right incentives for the unemployed to work and for parents to live together under the same roof.

ThreePathways Cameron's great task is to convince the public that the best way to tackle poverty is very different from the Labour approach. The Left sees poverty-fighting in terms of spending government money. The Big Society is struggling as an alternative narrative. Cameron's message must be based around education, family and work. He must say in clear terms that it is every individual's responsibility to escape poverty by acquiring a basic education, providing for his or her family and by taking work. It is government's job to help people achieve those three things. The three pathways out of poverty and government's role in helping people follow those paths must be the central message of compassionate conservatism. Getting most able persons off state benefits will then ensure taxpayers can provide generously for the genuinely needy amongst the old, sick and disabled.

The Prime Minister also needs to revive his powerful idea of 'the nation of the second chance'. A nation where Big Society institutions including social entrepreneurs and faith groups help mend people who are broken by debt, drugs or other adversities.


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