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LONDON (Reuters) -Prime Minister Keir Starmer announced plans to get Britain’s ailing workforce back into jobs on Tuesday with better support for mental health and finding work, but the government delayed a consultation on reforming welfare to encourage people into work.
Mental health support will target geographic areas with high rates of labour market inactivity and job centres will focus more on career advice than on policing benefits, the government said in a policy paper.
Starmer has set a target of getting Britain’s employment rate up to 80% – from just under 75% now – as part of a plan to accelerate economic growth.
Britain is the only major economy where the inactivity rate remains above its pre-COVID-19 levels, largely driven by a significant rise in the number of people out of work due to long-term ill health.
Spending on sickness benefits is now projected to top 100 billion pounds ($126 billion) a year by the end of this parliament in 2029, double the level before the pandemic.
But the government pushed back until next year a consultation for how it plans to change the health and disability welfare system to encourage more people to seek work.
“This government inherited a country that simply isn’t working. But today we’ve set out a plan to fix this,” said Starmer, whose Labour Party won July’s parliamentary election.
The opposition Conservative Party said the government had “dodged the tough decisions” on welfare reform after the proposals were announced.
One of the ideas in the policy paper will be a “youth guarantee”, promising every person between the ages of 18 and 21 the opportunity of education, training or a job. Anyone who refused this offer would have their benefits cut.
Rupert Soames, chair of the Confederation of British Industry, accused the government of pushing contradictory policies after the finance minister last month raised employers’ social security contributions.
Soames said making it more expensive to hire was “directly in conflict” with asking companies to recruit more people who had been out of work for years.
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(Reporting by Andrew MacAskillEditing by Elizabeth Piper and Ros Russell)