Rachel Reeves puts £240m into new back to work ‘trailblazers’
Chancellor Rachel Reeves has announced a £240m funding boost for the rollout of local services tasked with getting the long-term sick back into work.
Ahead of the Budget, Prime Minister Keir Starmer confirmed that tackling rising economic inactivity would be a core economic priority for his government.
“We will always help those who cannot support themselves, but the UK is the only G7 country where economic inactivity is still higher than it was before Covid,” he said in a speech in Birmingham.
The funding announced today will go towards Get Britain Working ‘trailblazers’, which will bring together work, health and skills support for the long-term sick.
The ‘trailblazers’ will focus on reaching people who are not normally in touch with the system, the Treasury said, while testing early interventions against specific barriers to work.
“We will build a Britain where people who can work, will work, turning the page on the recent rise in economic inactivity,” Reeves said.
Around 2.8m people are out of the workforce due to ill health, an increase of 900,000 on pre-pandemic levels.
The increase in the number of people out of work has been a significant barrier to economic growth and has put the public finances under increasing strain.
Government estimates suggest that spending on disability and health support will rise by £30bn by 2028/29. Reeves said the benefits bill was “ballooning” due to economic inactivity.
Alongside the support for the long-term sick, the government announced that 800,000 people on the old Employment and Support Allowance would be moved onto Universal Credit this autumn rather than 2028.
“This move will bring more people into a modern benefit regime, continuing to ensure they are supported to look for and move into work,” the government said.
The government has set a target of lifting the employment rate to 80 per cent, which would mean an extra 2m people entered the workforce.