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A Department for Work and Pensions (DWP) shake-up could deliver annual savings of up to £3 billion for the Treasury.

The Institute for Fiscal Studies (IFS) has found, if the DWP combines Jobseeker's Allowance and Employment Support Allowance as planned, into a unified unemployment insurance scheme, the economy could be turbocharged.

Under existing rules, unemployed benefits claimants receive £92.05 weekly for a maximum of six months, whilst those with health conditions affecting their work capacity obtain £140.55 through ESA. The new unified benefit would adopt the higher payment rate of £140.55, up nearly 53 per cent.

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The Institute for Fiscal Studies (IFS) has concluded the proposed changes could

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