Sunak’s Crackdown on Jobseeker’s Allowance Could Boost UK Treasury by Millions
A recent study by finance firm RIFT reveals Chancellor Rishi Sunak’s tough new measures on dodgy Jobseeker’s Allowance (JSA) claims could rake in a hefty boost to the UK economy.
What’s Happening With Jobseeker’s Allowance?
JSA is a benefit for those actively hunting for work while working under 16 hours a week. It’s currently being phased out and merged into Universal Credit. Youngsters under 25 can claim up to £71.70 weekly, while over-25s get up to £90.50.
Right now, 87,631 Brits are claiming JSA, though numbers are dipping slightly, down 1.6% year on year. The hotspots? London leads with 16.6% of claimants, followed by the West Midlands at 12.1%, and the South East on 11.6%. Surprisingly, the South West has seen a massive 22.7% jump in claimants over the past year.
Abuse of the System and Government Response
The National Audit Office has uncovered that a shocking 25% of JSA claimants are abusing the system. In response, former PM Boris Johnson introduced welfare reforms including scrapping JSA payments after 12 months if job offers are refused.
Big Bucks at Stake: How Employment Could Boost Tax Revenue
RIFT’s analysis calculates that helping JSA claimants move into work could pay off big time. Using the current minimum wage of £11.44/hr for those over 21, working 40 hours a week, an average earner could pull in £23,795 a year.
That would mean a tidy tax haul of £3,143 per person annually — made up of £2,245 income tax and £898 national insurance. If even 25% of current claimants find work, this could pump nearly £69 million into the British economy yearly. London alone would add £11.4 million to the pot.
Bradley Post, Managing Director of RIFT, said: “Britain’s benefit system plays a vital role in helping those in genuine need. But it’s crucial we clamp down on abuse. Transitioning claimants into employment not only benefits individuals but gives the economy a real shot in the arm, though we do recognise many face real challenges in making this leap.”
The government’s goal is clear: support those struggling while cleaning up welfare abuse — all in the name of shoring up the UK economy.
