Councils may get power to set benefits

Author: The Guardian - Jan 27, 2010

The Conservative Treasury team are holding talks on handing responsibility to local councils for setting and distributing benefits such as the jobseeker's allowance.

A move to setting benefit rates to match the needs of local labour markets has been pushed by radical Tory councils but it is the first time that the frontbench has embraced the concept.

Speaking at a conference in London, the shadow chief secretary, Philip Hammond, disclosed that he was holding talks on the issue with Conservative councils, including Kent.

He said: "There are some key challenges we will have to face in delivering this agenda. Can we take the public with us in this agenda? Can we persuade people living in your area, for example, they would rather see the management of workless benefits in the hands of a local authority than in the hands of a national government setting standards nationally?"

He said "huge potential savings" were available, adding that he regarded local government as pivotal to reducing the public sector deficit.

Under the proposal benefits would be lower where it was easier to find work. Councils would also be given incentives to help people find jobs. The plan has not yet appeared in any formal document.

At the same conference John Denham, the communities secretary, put his faith in Total Place, a scheme that aims to drive out duplication and increase partnership working.

"Local people will rightly be intolerant if they are told that frontline services will be cut when their council hasn't taken tough decisions to introduce shared services, sharing senior staff with other local authorities, PCTs or other bidders, or through making the best use of public buildings," he said.

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