Belfast Telegraph

An aggressive benefit take-up campaign would help the jobless and aid local economy

By Liam Clarke

There is something particularly nasty about the efforts of the Westminster elite to blame the recession on the long-term unemployed - now dubbed 'the work-shy'.

Our own administration at Stormont should not fall for this tacky populism. We are still in recession and we need policies which will keep every possible pound in our local economy, encouraging entrepreneurial innovation rather than rent-seeking in the private sector and protecting public services.

One positive measure that could be taken is standing by the unemployed and disadvantaged by funding an aggressive benefit take-up campaign. It should be aimed at ensuring that everyone who is left without a job, or is unable to work through disability, gets every penny he or she is entitled to.

With job-cuts coming, this is the worst and cruellest possible moment to start stigmatising the unemployed. The beauty of a benefit take-up campaign is that it will actually bring money into the economy - Westminster funds our welfare spending separately from the Block Grant.

Yet money paid in benefits is spent overwhelmingly on local goods and services; it puts money in the tills of local shops, it pays for public transport - and all at no cost to Stormont.

This is one area where investment by Stormont in computer software, developed by local firms and available in libraries, and employing advice staff, is aimed at helping benefit claimants maximise their legal entitlement.

The cost of software development could be pooled with the Scottish and Welsh assemblies and redundant civil servants, who know how the system works, would make ideal benefits advisors employed through grants to the voluntary sector.

Iain Duncan Smith is about to unveil a new benefit system which he claims will be simpler.

However, any change of this kind is never that simple for those on the receiving end and will require explanation.

Stormont politicians need to lead from the front in challenging descriptions of benefits as 'handouts' and of those receiving them as 'shirkers'.

At a time when tax offices, which should be pursuing wealthy tax-evaders, are being shut and bankers are pocketing huge bonuses for forcing their banks into public ownership, we need to jettison Victorian notions of the 'undeserving poor'.

A society is not judged on how well it rewards top shopkeepers, like Marc Bolland, who will receive £8.5m in his first year as head of Marks -amp; Spencer, or speculators.

What matters is how well it looks after those in need, the opportunity it provides for advancement regardless of family circumstances and its capacity to encourage productive entrepreneurial innovation instead of financial speculation.

All this involves providing a safety net for families - even large families - where parents are out of work.

Children in such households are not scroungers and, as a former welfare rights worker myself, I know that most adult claimants desperately want to work.

Currently, the Jobseekers Allowance is £65-per-week.

There may be a few families in the home counties who claim huge amounts in housing benefit because they live in high- rent areas, but the basic living allowance is a pittance. Who would choose to exist on such an income if there was a better alternative?

People are desperate for work and even temporary low-paid jobs are snapped up.

Tesco got 1,700 applications for 230 seasonal posts, mostly as shelf-stackers for the Christmas rush.

There are four jobless people for every vacancy in the UK.

Here things will be worse than that when a predicted 30,000 people lose their jobs as a result of cutbacks.

Stormont is meeting this catastrophe by proposing a cut in corporation tax - delayed until after next May's election, but funded to the tune of hundreds of millions a year out of the Block Grant.

What isn't realised is that, under EU rules, this tax-break cannot be limited to productive enterprises and key industries which could 'rebalance' our economy towards the private sector. It will also be paid to banks and shops.

It is a blunt instrument and even if we foot the bill for reducing corporation tax from 28% to the 12.5% charged in the Republic, it will still not make us competitive with European countries like Cyprus, Bulgaria or Macedonia (all 10%), or the Isle of Man where there is no corporation tax at all.

We need something smarter.

We could inform target industries that they will receive allowances roughly equivalent to their corporation tax if they locate here.

Better still, and at no cost to our block grant, we could set up a cross-border initiative for companies to form headquarters in the Republic, but base their main operations here.

Border regions would thus become particularly attractive to companies.

Dublin would benefit from the tax revenue and some jobs, the firms would enjoy lower tax in the south and lower overheads in the north.

The only cost - and the only risk - would be to the Treasury and it, too, could benefit if there was a reduction in unemployment.

It may sound selfish, but generosity is self-defeating in politics - especially when it is at the expense of your own voters.

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