Rachel Reeves to set out how a fair affordable social security system will help tackle the cost-of-living crisis

In her first major policy speech since becoming Shadow Secretary of State for Work and Pensions, Rachel Reeves will set out the next steps in Labour’s plan to earn our way out of the cost-of-living crisis and ensure our social security system is fair and affordable. Speaking to the IPPR this morning, Rachel Reeves will set out the ‘costs of failure’ of the Tory-led government, showing how long-term unemployment, low pay and insecure jobs are adding billions to the social security bill. This includes:

• Failure to reverse rises in levels of youth and long-term unemployment that will add to benefits bills and hit tax revenues for decades to come
• Record numbers of people stuck in low paid jobs, or working shorter hours than they want, resulting in rising expenditure on in-work tax credits and housing benefit. Official figures published alongside the Autumn Statement show that spending on Housing Benefit for those in work (or short term sick) is set to rise by over £1bn between now and 2016-17.
• Increasing job insecurity, including high numbers on zero hours or temporary contracts, which makes it harder for people to buy their own home or save for a pension.

Rachel Reeves is expected to argue that, ‘Only Labour, is the 'party of work' and can deliver the 'reforms needed to tackle the causes of rising benefit bills, so we can keep the costs of social security under control, while recognising responsibility and contribution'. In her speech, Rachel Reeves will announce that a Labour government would 'introduce a Basic Skills Test so we intervene earlier to prevent long-term unemployment and low earnings.'

Tackling the lack of basic skills among jobseekers is a key part of Labour’s plan to earn our way out of the cost-of-living crisis by getting more people into work and helping them to earn a decent standard of living. Poor English and maths often hold people back from getting jobs, or trap them in a cycle between a low paid and insecure job and claiming benefits.

Rachel Reeves is expected to say: "We all know that basic skills are essential in today’s jobs market, but the shocking levels of English and maths among too many jobseekers are holding them back from getting work. This traps too many jobseekers in a vicious cycle between low paid work and benefits. Government plans in this area just aren’t enough. They’re now asking jobseekers who exit the failed Work Programme to take up literacy and numeracy training, three whole years after those people first make a claim for benefits.

”A Labour government will introduce a Basic Skills Test to assess all new claimants for Job Seekers Allowance within six weeks of claiming benefits. Those who don’t have the skills they need for a job will have to take up training alongside their jobsearch or lose their benefits. Labour’s Basic Skills Test will give the long-term unemployed a better chance of finding a job and will help us to earn our way out of the cost-of-living crisis.”

The Basic Skills Test announced on Monday, will work alongside further reforms that Rachel Reeves and the Labour DWP team will be unveiling over the coming months to make the benefits system and back-to-work support better equipped to help people find a job and earn enough to make ends meet .

Responding to Rachel Reeves' speech, a Conservative Spokesman said: "Labour are copying a Conservative policy that already exists and that is superior to the one they are proposing. After 13 years of Labour running our education system, many young people looking for work do not have the English and Maths skills they need to get a job. That's why, starting in some areas at first, anyone aged 18 to 21 signing on without these basic skills will be required to undertake training from day one or lose their benefits. And we are making the long-term changes needed to fix the system by requiring all young people who have not achieved a proper qualification in English and Maths at 16 to continue studying these subjects until age 19."

Concluding the Conservative spokesman said: "Without basic English or Maths, there is a limited chance any young person will be able to stay off welfare. David Cameron's long-term economic plan will give young people the skills they need to get on in life and have a more financially secure future."