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The Coalition must not create the modern workhouse

18 February 2012

5:04 PM

18 February 2012

5:04 PM

I have warned on this blog before that the reforms of the welfare-to-work system risk
embedding unpaid labour into the benefits system. This week’s story about Tesco advertising for night shift workers to be paid Job Seeker’s Allowance plus expenses has rightly caused
outrage now it seems that large retailers and charities are pulling out of the work experience element of the Work Programme.

As the Independent reports today, Matalan has suspended its
involvement in the scheme and Waterstones, Sainsbury’s and TK Maxx have expressed their opposition. Employers are now said to be concerned that job seekers will lose their benefits if they
drop out of placements. Shiv Malik of the Guardian, who has been tenacious in following this story, reports that Tesco is now urging the government to make changes to the scheme. But this may not be enough.
The reaction to the Tesco story demonstrates that there is real public concern even if people still receive benefits when they work.

I’m not surprised. The new system drives a coach and horses through the principle of a national minimum wage, which is effectively reduced to the level of Job Seeker’s Allowance.
Although I have no doubt the architects of the new system, Iain Duncan Smith and Lord Freud, had the best interests of job seekers’ at heart. (I genuinely believe this, by the way. It is
common sense that people with work experience have a better chance of getting a job). But this does not mean it is legitimate not to pay people. The pure free-market value of labour may be zero (or
indeed less than zero in parts of the country) but we cannot justify slave labour in a civilised society.

Iain Duncan Smith and his benefits attack dog Chris Grayling need to act quickly to stop this becoming a crisis. The government’s Work Programme is utterly dependent on the good will of
employers. If they do not come on board, the new scheme will fail, it’s as simple as that. If they continue to pull out at this rate, the so-called ‘Prime Contractors’, who have
been given the job of running welfare to work, will not make the profits they need from each ‘customer’ they place and they could also pull out.

The Coalition believes, probably correctly, that there is an appetite for benefit reform. But there is little appetite for something which looks a lot like the modern version of the workhouse.

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