By Claire West

Changes to the welfare system will mean that unemployed people who turn down offers of work, refuse to apply for appropriate jobs or fail to turn up for mandatory community work will lose their £65-a-week Job Seekers Allowance, the coalition government announced today.

According to Iain Duncan Smith The Welfare Reform White Paper, launched today, will simplify welfare by introducing a "universal credit" to replace a system which had become overly complex and counter-productive under Labour, with more than 30 different and confusing benefit payments. It will remove barriers to work by making sure that work always pays, and bring welfare spending back under control.

Setting out the changes, Mr Duncan Smith , The Secretary of State for Work and Pensions said:
"By simplifying and having one withdrawal rate we will actually make sure people will retain more of what they earn as they go back to work, thus making work pay more than being on benefits. That's the critical bit.

"We will help people look for work and get them work ready, that will go alongside it. Then, if having done all of that people have a job offer, they should take that work. That's a condition most taxpayers would accept."
"This is about saying to people: if you try, if you co-operate, if we work with you and work pays and you still can't get a job then our duty is to support you.
"It is the right duty and we will always stand by it.
"But we cannot, as a society, have nearly one in five households completely without work through a time when we have had the longest and greatest period of growth."

The CBI commented on the publication of the welfare reform White Paper called Universal Credit: welfare that works.

John Cridland, CBI Deputy Director-General, said:

“We support the Government’s plans to make work pay by getting more people into the jobs market and off benefits which will encourage economic growth.

“As the economy recovers and the private sector creates jobs, companies must be able to access people with the right skills and work ethic. The Government should make the most of private and voluntary sector expertise in helping the long-term unemployed back into work.

“It is important that administration of the universal credit is simple. We would be concerned about any moves to take away responsibility for paying staff from companies, as this could undermine the relationship between employers and employees.”