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Today I鈥檇 like to talk about the鈥痝rowing number of people who have become economically inactive since the pandemic鈥�

鈥�鈥�and the鈥痬oral mission of reforming welfare to give everyone who can, the best possible chance of returning to work.

The values of our welfare state are timeless.

They鈥檙e part of our national character 鈥� of鈥� who鈥痺e are as a country.

We鈥檙e proud to ensure a safety net that is generous for those who genuinely need it 鈥� and fair to the taxpayers who fund it.

We know there are some with鈥痶he鈥痬ost severe conditions鈥痺ho will never be able to work.聽

And some who can no longer work because of injury or illness.

And they and their loved ones must always have the peace of mind that comes from knowing they will always be supported.

But we also have a鈥痩ong-standing and proudly British view鈥痶hat work is a source of dignity, purpose, of hope.

The role of the welfare state should never be merely to provide financial support鈥β�

鈥�as important as that will always be鈥�

鈥�but to help people overcome whatever barriers鈥痶hey might face to living an independent, fulfilling life.

Everyone with the potential should be supported鈥�

And not just to earn, but to contribute and belong.

And we must never tolerate barriers that鈥痟old people鈥痓ack鈥痜rom making their contribution鈥β�

鈥�and from sharing in that sense of self-worth that comes from feeling part of being something bigger than ourselves.

That is why this is a moral mission.

And why the value of work is so central to my vision for welfare reform.

And it鈥檚 fitting to be setting out that vision here, at the Centre for Social Justice.聽

Over your 20-year history, you鈥檝e inspired far-reaching changes to welfare.聽

I want pay tribute to you and of course your founder, Iain Duncan-Smith鈥β�

鈥�who began the journey of reform in 2010鈥β�

鈥�a journey carried through so ably today, by Mel Stride.聽

Because when we arrived in office in 2010, people coming off benefits and into work could lose 拢9 for every 拢10 they earned鈥�

鈥�by far the highest marginal tax rate.聽

That was morally wrong.聽聽

So we created Universal Credit to make sure that work always pays.聽

We introduced the National Living Wage 鈥� and increased it every year, ending low pay in this country.鈥�聽

We鈥檙e rolling out 30 hours of free childcare for every family over 9 months of age.鈥�聽

We鈥檝e halved inflation, to make the money you earn worth more.鈥�聽

And we鈥檝e cut workers鈥� National Insurance by a third.

A tax cut worth 拢900 for someone earning the average wage鈥β�

鈥�because it is profoundly wrong that income from work is taxed twice鈥β�

鈥�when other forms of income are not.聽

For me, it is a fundamental duty of government to make sure that hard work is always rewarded.聽聽

I know - and you know - that you don鈥檛 get anything in life without hard work.

It鈥檚 the only way to build a better life for ourselves and our family; and the only way to build a more prosperous country.聽聽

But in the period since the pandemic something has gone wrong.聽聽

The proportion of people who are economically inactive in Britain is still lower than our international peers.聽聽

And lower today than in any year under the last Labour government.聽

But since the pandemic, 850,000 more people have joined this group due to long-term sickness.聽聽

This has wiped out a decade鈥檚 worth of progress in which the rate had fallen every single year.聽聽

Of those who are economically inactive, fully half say they have depression or anxiety.聽

And most worrying of all鈥β�

鈥�the biggest proportional increase in economic inactivity due to long-term sickness came 鈥β�

鈥�from young people.聽

Those in the prime of their life, just starting out on work and family - instead parked on welfare.聽聽

Now, we should see it as a sign of progress that people can talk openly about mental health conditions鈥β�

鈥�in a way that only a few years ago would鈥檝e been unthinkable.鈥�聽

And I will never鈥痙ismiss or鈥痙ownplay the illnesses people have.聽

Anyone who has suffered mental ill health or had family or friends who have, knows that these conditions are real and they matter.聽

But just as it would be wrong to dismiss this growing trend鈥β�

鈥�so it would be wrong merely to sit back and accept it鈥β�

鈥�because it鈥檚 too hard; or too controversial; or for fear of causing offence.聽

Doing so, would let down many of the people our welfare system was designed to help.聽

Because if you believe as I do, that work gives you the chance not just to earn鈥�

鈥�but to contribute, to belong, to overcome feelings of loneliness and social isolation鈥β�

鈥�and if you believe, as I do, the growing body of evidence that good work can actually improve mental and physical health鈥β�

鈥�then it becomes clear: we need to be more ambitious about helping people back to work.鈥�聽

And more honest about the risk of over-medicalising the everyday challenges and worries of life.聽聽

Fail to address this, and we risk not only letting those people down.鈥�聽

But creating a deep sense of unfairness amongst those whose taxes fund our social safety net鈥β�

鈥�in a way that risks undermining trust and consent in that very system.聽

We can鈥檛 stand for that.鈥�聽

And of course, the situation as it is, is economically鈥痷nsustainable.聽

We can鈥檛 lose so many people from our workforce whose contributions could help to drive growth.

And there鈥檚 no sustainable way to achieve our goal of bringing down migration levels, which are just too high鈥�

鈥�without giving more of our own people the skills, incentives, and support, to get off welfare and back into work.

And we can鈥檛 afford such鈥痑 spiralling increase in the welfare bill鈥β�

鈥�and the irresponsible burden that would place on this and future generations of taxpayers.

We now spend 拢69bn on benefits for people of working age with a disability or health condition.聽

That鈥檚 more than our entire schools budget; more than our transport budget; more than our policing.聽

And spending on Personal Independence Payments alone is forecast to increase by more than 50 per cent over the next four years.聽聽

Let me just repeat that: if we do not change, it will increase by more than 50% in just four years.聽聽

That鈥檚 not right; it鈥檚 not sustainable and it鈥檚 not fair on the taxpayers who fund it.

So in the next Parliament, a Conservative government will significantly reform and control welfare.聽聽

This is not about making our safety net less generous.聽

Or imposing a blanket freeze on all benefits, as some have suggested.鈥�聽

I鈥檓 not prepared to balance the books on the backs of the most vulnerable.聽

Instead, the critical questions are about eligibility鈥β�

鈥�about who should be entitled to support鈥�

鈥�and what kind of support best matches their needs.聽

And to answer these questions, I want to set out today five Conservative reforms for a new welfare settlement for Britain.聽

First, we must be more ambitious in assessing people鈥檚 potential for work.鈥�聽

Right now, the gateway to ill health benefits is writing too many off鈥β�

鈥�leaving them on the wrong type of support鈥β�

鈥�and with no expectation of trying to find a job, with all the advantages that brings.聽

In 2011, twenty percent of those doing a Work Capability Assessment鈥β�

鈥�were deemed unfit to work.聽

But the latest figure now stands at 65 per cent.聽

That鈥檚 wrong.聽

People are not three times sicker than they were a decade ago.聽

And the world of work has changed dramatically.聽

Of course, those with serious debilitating conditions should never be expected to work.聽聽

But if you have a low-level mobility issue, your employer could make reasonable adjustments鈥︹��聽

鈥�perhaps including adaptations to enable you to work from home.聽

And if you are feeling anxious or depressed, then of course you should get the support and treatment you need to manage your condition.聽

But that doesn鈥檛 mean we should assume you can鈥檛 engage in work.鈥�聽

That鈥檚 not going to help you. And it鈥檚 not fair on everyone else either.鈥�聽

So we are going to tighten up the Work Capability Assessment鈥β�

鈥�such that hundreds of thousands of benefit recipients with less severe conditions鈥β�

鈥�will now be expected to engage in the world of work 鈥� and be supported to do so.

Second, just as we help people move from welfare into work鈥β�

鈥�we鈥檝e got to do more to stop people going from work to welfare.聽

The whole point of replacing the Sick Note with the Fit Note was to stop so many people just being signed off as sick.聽聽

Instead of being told you鈥檙e not fit for work鈥β�

鈥�the Fit Note provided the option to say that you may be fit for work鈥β�

鈥�with advice about what you could do; and what adaptions or support would enable you to stay in, or return to work, quickly.聽聽

11 million of these Fit Notes were issued last year alone.鈥�聽

But what proportion were signed 鈥渕aybe fit for work鈥�?聽

6 per cent.鈥�

That鈥檚 right 鈥� a staggering 94 per cent of those signed off sick鈥β�

鈥�were simply written off as 鈥渘ot fit for work.鈥澛�

Well, this is not right.鈥疉nd it was never the intention.聽聽

We don鈥檛 just need to change the sick note 鈥� we need to change the sick note culture鈥β�

鈥�so the default becomes what work you can do 鈥� not what you can鈥檛.聽聽

Building on the pilots we鈥檝e already started..

鈥�we鈥檙e going to design a new system鈥β�

鈥�where people have easy and rapid access to specialised work and health support鈥�

鈥�to help them back to work from the very first Fit Note conversation.聽聽

And part of the problem is that it鈥檚 not reasonable to ask GPs to assess whether their own patients are fit for work.聽

It too often puts them in an impossible situation where they know that refusal to sign someone off鈥β�

鈥�will harm their relationship with that patient.聽

So we鈥檙e also going to test shifting the responsibility for assessment from GPs鈥β�

鈥�and giving it to specialist work and health professionals鈥β犅�

鈥�who have the dedicated time to provide an objective assessment of someone鈥檚 ability to work鈥�

鈥�and the tailored support they need to do so.聽聽

Third, for those who could work with the right support鈥β�

鈥�we should have higher expectations of them in return for receiving benefits.鈥�聽

Because when the taxpayer is supporting you to get back on your feet鈥β�

鈥�you have an obligation to put in the hours.聽

And if you do not make that effort, you cannot expect the same level of benefits.聽聽

It used to be that if you worked just nine hours a week, you鈥檇 get full benefits without needing to look for additional work.聽聽聽

That鈥檚 not right. Because if you can work more, you should.聽聽

So we鈥檙e changing the rules.聽聽

Anyone working less than half a full-time week will now have to try and find extra work in return for claiming benefits.聽

And we鈥檒l accelerate moving people from legacy benefits onto Universal Credit, to give them more access to the world of work.聽 鈥�聽

One of my other big concerns about the system鈥β�

鈥�鈥�is that the longer you stay on welfare, the harder it can be to go back to work.聽

More than 500,000 people have been unemployed for 6 months鈥β�

鈥�鈥�and well over a quarter of a million have been unemployed for 12 months.聽

These are people with no medical conditions that prevent them from working鈥β�

鈥�and who will have benefitted from intensive employment support and training programmes.聽

There is no reason those people should not be in work, especially when we have almost 1 million job vacancies.聽

So we will now look at options to strengthen our regime.聽

Anyone who doesn鈥檛 comply with the conditions set by their Work Coach鈥�

鈥�such as accepting an available job鈥β�

鈥�will, after 12 months, have their claim closed and their benefits removed entirely.

Because unemployment support should be a safety net 鈥� never a lifestyle choice.

Fourth, we need to match the support people need to the actual conditions they have.聽

And help people live independently and remove the barriers they face.聽

But we need to look again at how we do this through Personal Independence Payments. I worry about it being misused.聽

Now its purpose is to contribute to the extra costs people face as they go about their daily lives.聽

Take for example, those who need money for aids or assistance鈥β�

鈥�鈥�with things like handrails or stairlifts.聽

Often they鈥檙e already available at low cost, or free from the NHS or Local Authorities.鈥� 鈥�聽

And they鈥檙e one-off costs鈥β�

鈥�so it probably isn鈥檛 right that we鈥檙e paying an ongoing amount every year.鈥�聽

We also need to look specifically at the way Personal Independence Payments support those with mental health conditions.鈥�聽聽

Since 2019, the number of people claiming PIP citing anxiety or depression as their main condition, has doubled鈥β�

鈥�with over 5,000 new awards on average every single month.聽

But for all the challenges they face鈥�

鈥�it is not clear they have the same degree of increased living costs as those with physical conditions.鈥�聽

And the whole system is undermined by the way people are asked to make subjective and unverifiable claims about their capability.聽

So in the coming days we will publish a consultation on how we move away from that鈥β�

鈥�to a more objective and rigorous approach that focuses support on those with the greatest needs and extra costs.聽

We will do that by being more precise about the type and severity of mental health conditions that should be eligible for PIP.聽

We鈥檒l consider linking that assessment more closely to a person鈥檚 actual condition鈥�

鈥�and requiring greater medical evidence to substantiate a claim.聽

All of which will make the system fairer and harder to exploit.聽

And we鈥檒l also consider whether some people with mental health conditions should get PIP in the same way through cash transfers鈥β�

鈥�or whether they鈥檇 be better supported to lead happier, healthier and more independent lives鈥︹��聽

鈥�through access to treatment like talking therapies or respite care.聽

I want to be completely clear about what I鈥檓 saying here.聽

This is not about making the welfare system less generous to people who face very real extra costs from mental health conditions.聽聽

For those with the greatest needs, we want to make it easier to access with fewer requirements.

And beyond the welfare system, we鈥檙e delivering the largest expansion in mental health services in a generation鈥β�

鈥�with almost 拢5 billion of extra funding over the past 5 years, and a near doubling of mental health training places.聽

But our overall approach is about saying that people with less severe mental health conditions鈥β�

鈥�should be expected to engage with the world of work.聽

Fifth, we cannot allow fraudsters to exploit the natural compassion and generosity of the British people. 鈥�聽

We鈥檝e already cracked down on thousands of people wrongly claiming Universal Credit鈥β�

鈥�including those not reporting self-employed earnings or hiding capital 鈥�聽

And we鈥檒l save the taxpayer 拢600 million by legislating to access vital data from third parties like banks.聽

Just this month, DWP secured guilty verdicts against a Bulgarian gang caught making around 6,000 fraudulent claims鈥�

鈥�including by hiding behind a corner shop in North London.聽

And we鈥檙e going further.鈥�聽

We鈥檙e using all the developments in modern technology, including Artificial Intelligence鈥�

鈥�to crack down on exploitation in the welfare system that鈥檚 taking advantage of the hardworking taxpayers who fund it.

We鈥檙e preparing a new Fraud Bill for the next Parliament which will align DWP with HMRC鈥β�

鈥�so we treat benefit fraud like tax fraud鈥β�

鈥�with new powers to make seizures and arrests.聽

And we鈥檒l also enable penalties to be applied to a wider set of fraudsters through a new civil penalty.聽

Because when people see others in their community gaming the system that their taxes pay 鈥β�

鈥�it erodes support for the very principle of the welfare state.聽

Now, in conclusion some people will hear this speech and accuse me of lacking compassion.聽聽

Of not understanding the barriers people face in their everyday lives.聽

But the exact opposite is true.聽

There is nothing compassionate about leaving a generation of young people to sit alone in the dark before a flickering screen鈥β�

鈥�watching as their dreams slip further from reach every passing day.聽聽

And there is nothing fair about expecting taxpayers to support those who could work but choose not to.聽

It doesn鈥檛 have to be like this.聽

We can change. We must change.聽

The opportunities to work are there鈥β�

鈥�thanks to an economic plan that has created almost a million job vacancies.聽

The rewards for working are there鈥β�

鈥�thanks to our tax cuts and increases to the National Living Wage.聽

And now, if we can deliver the vision for welfare I鈥檝e set out today鈥β�

鈥�then we can finally fulfil our moral mission, to restore hope鈥�

鈥�and give back to everyone who can, the dignity, purpose and meaning that comes from work.聽聽

Thank you.