Chancellor confirms 'agreement' on benefits overhaul



Mr Osborne suggests any disagreements have been ironed out


Chancellor George Osborne has confirmed there will be a major overhaul of the benefits system with a new universal credit introduced.
Mr Osborne told the Daily Telegraph "substantial savings" were to be made.
Details of the replacement for existing benefits are likely to come out as the Conservatives meet for their annual conference in Birmingham on Sunday.
The changes are being brought in partly to tackle perceived long-term welfare dependency by unemployed people.
Welfare reform is also key to plans to cut the UK's deficit, but has been the source of reported tension between ministers.


Mr Osborne has already signalled he wants billions of pounds-worth of welfare cuts as part of the government's imminent spending review - on top of £11bn outlined in June's Budget.
As part of this shake-up, it is understood the Work and Pensions Secretary Iain Duncan Smith has won his fight within government to replace the current system of Jobseekers Allowance, income support and employment support allowance with a single universal benefit in an effort to simplify the system.
Some unemployed people currently complain they are better off on benefits than working - leading to accusations that the current system encourages long-term welfare dependency.


Friends of Mr Duncan Smith believe he has won "broad agreement" that work should pay more than benefit, and that he will be allowed to keep an element of expected savings in the welfare budget to ensure people are not worse off when they move off benefits.
Under the new proposals, claimants could continue to receive some benefit payments when they go back into work - meaning they could be less likely to reject low-paid work.
The amount would taper off as their earnings increase.
BBC political correspondent Robin Brant says the plans are probably the "most significant reform" of the coalition so far.
Some savings are already being made through restrictions in payments such housing benefit. But the overall cost to the government is initially expected to rise after the changes are brought in as people return to work and retain some financial assistance.
There are no specific details on how long it will take for the savings to be realised but it is likely to be 10-15 years, our correspondent added.
The issue is likely to be a major focus of debate during the conference.


http://www.bbc.co.uk/news/uk-politics-11459055