Neither civil servants or ministers are stupid. They know that the economic outlook might change substantially over the next period. However, we’re currently at a really critical juncture. Government investment in employment support is about to be cut radically. There appear to be two main reasons for that. First, the labour market has been doing well which means that government believes it has a ‘peace dividend’ – it can invest less as there is less demand. Second, there is rather touching faith that Universal Credit (UC) will prove a game changer, tempting more people back into work because the financial incentives line up. Our belief, alongside many other commentators, is that UC is an improvement, but won’t change the world; first, because of the cuts to taper rates and second, because people respond to a complexity of factors and not just financial incentives.
Article source: http://www.huffingtonpost.co.uk/kirsty-mchugh/from-priti-to-penny-inher_b_11388818.html?utm_hp_ref=uk-politics&ir=UK+Politics