That Iain Duncan Smith has resigned from Cabinet should come as no surprise. With views on Europe incompatible with a continued tenure in his position following the referendum (whatever the result), it was a matter of when, rather than whether, it would happen. It is the focus and depth feeling of his resignation letter to the Prime Minister that provides the interest and highlights a rift inside the Government between cuts and compassion, that must be addressed.
There is no escaping the fact that this difference in views on welfare policy has existed between HM Treasury and the Department for Work and Pensions (DWP) since 2010. The former focused on cuts and the latter a reforming agenda to improve social justice. When there was significant room for maneuver within the bloated working age welfare budget, these opposing positions could be reconciled. Cuts targeted at tax credits, families with extremely large benefit payouts and a range of claimants viewed by the public as less deserving, did not undermine a narrative that spoke of giving more support to those who need it, tackling social injustice and introducing Universal Credit. But now, with the list of low-hanging welfare savings seemingly used up, the last two Budgets from the Chancellor have had to announce significant cuts to disability benefits.
That is not to say that disability benefits have not been cut before, they have. But these latest attempts have been more visible. This visibility matters. Many MPs with their own experience of disability (whether themselves, in their family or simply as part of their constituency work) will be opposed to these changes in principle and, with polling showing that the public are sympathetic towards disabled benefit claimants, it is no surprise that others have begun to worry about how the proposed changes will go down with voters.
Much more broadly as Duncan-Smith’s letter shows, these reforms have uncovered a worrying departure from an approach that has previously tried to protect those most in need from the impact of cuts. If this continues, and as more people with significant disabilities or other problems are hit by large losses in benefits, there is a real risk that public support for wider cuts will diminish. That means that, as the new Secretary of State takes their position, whether part of camp-Osborne or not, they need to continue to stand up for compassion and ensure that this slide to indiscriminate cuts is halted.
So what does this mean in practice? The first challenge will be to show that cuts and compassion are actually compatible. Improving life chances and social justice and supporting more disabled people into work all significantly reduce the benefits bill. For example, achieving the Conservative manifesto pledge of halving the disability employment gap could, in one fell swoop, cut the benefits bill by upwards of £4 billion a year. The problem is that these savings will take time and cannot be achieved just by cutting benefit rates and hoping for the best. What is needed is a radical new strategy to improve support for those who need it and build on the foundations laid by the now ex-Secretary of State.
This must begin by realising what already works. That means not watering down the significant increases in requirements placed on those claiming benefits and looking for work we have seen in the last ten years. This is the right approach and one that is supported by evidence of its effective across many countries.
However, that does not mean that increased requirements are right for everyone. A recent SMF report has shown the range and depth of barriers to work that many people face. Tackling these requires real support not just constant hassle and the threat of sanctions. Here, a new approach is needed. A White Paper on disability and health is now penciled in for the Summer and the new Secretary of State must push their Civil Servants to be bold. The White Paper must show the compassion that is needed to tackle the problem by promising benefits that meet the needs of disabled people, scrapping benefit sanctions for those unable to work and introducing new voluntary programmes to support those who want to move into work. To win the argument on these reforms, the key will be to show that they can improve lives while, at the same time, saving the taxpayer money.
Finally, the reforming agenda of social justice must be strengthened. There remain significant groups of individuals whose life chances are poor, support from the state inadequate and, ultimately, cost to the taxpayer unwarranted. Children leaving the care system, single homeless people and the growing raft of workless people with mental health conditions all fall into this category. Improving support for these groups, must form part of a strategy to show that overall cost saving can be achieved by providing effective support, not just cuts and benefit sanctions.
Overall it is clear that, between Treasury and DWP, some radical improvements in the welfare system have been delivered since 2010. However, there is a risk that a Treasury bent on short-term savings will undermine the whole approach. The new Secretary of State must win the argument, bring the Treasury on board and set out an agenda for the rest of this Parliament that improves lives as well as saving money. Doing so would show the public that to be a Conservative you must be believe that compassion, as well as cuts, is central to what you believe.
