Benefit cuts have been brilliant for the North East, claims Iain Duncan Smith

Work and Pensions Secretary Iain Duncan Smith comes under fire after claiming benefit cuts have increased employment in the North East

Stefan Rousseau/PA Wire Secretary of State for Work and Pensions, Iain Duncan Smith and Employment Minister Esther McVey
Secretary of State for Work and Pensions, Iain Duncan Smith and Employment Minister Esther McVey

Work and Pensions Secretary Iain Duncan Smith has come under fire after claiming the North East has benefitted more than any other region from the Government’s welfare reforms.

The Conservative Minister said benefit cuts such as the bedroom tax had helped encourage people into work.

And he highlighted the North East as the region which had enjoyed the biggest increase in employment, partly as a result of his policies.

But the comments were criticised by Labour MP Grahame Morris, who argued that the problem was a lack of jobs rather than a refusal to work.

Mr Morris called for more action to support former mining communities - after a major study warned they had yet to recover from devastating closures and job cuts following the miners’ strike 30 years ago.

He said: “There simply aren’t enough jobs in the local economy to soak up the workforce, and driving down the living standards of the disabled and those relying on benefits isn’t going to solve that problem.”

In a speech highlighting recent falls in unemployment, Mr Duncan Smith claimed the last Labour government had allowed people to stay on benefits instead of working.

He said: “Businesses needed the labour and, because of the way our benefit system was constructed, too few of the economically inactive took the jobs on offer.”

Mr Duncan Smith said welfare reforms were partly about “encouraging work”, including the policy of cutting housing benefit for people in council or housing association properties who are considered to have spare rooms. This is described by the Government as cutting the spare room subsidy.

He said the result had been “remarkable”, adding: “Employment is up in every region . . . increasing the most in the North East of England over the last year.”

Latest unemployment figures put the number of people in work in the North East at 1.214 million, an increase of 61,000 people over the past year.

It means the number in work increased by 5.3 per cent over 12 months, which is the highest percentage increase of any region.

However, the North East also continues to have the highest unemployment rate, at 9.6 per cent.

And there are 49,000 people aged 16 to 24 who are out of work in the North East - an unemployment rate of 24 per cent, or almost one in four, for that age group.

Figures from the Department for Work and Pensions show that 37,249 households in the North East have had benefits cut because of the bedroom tax, losing £12.82 a week on average.

A separate study from the Department for Work and Pensions found that nationally, 57 per cent of claimants affected by the bedroom tax reported cutting back on what they deemed household essentials and 35 per cent on non-essentials in order to pay their shortfall. A quarter of claimants said they had borrowed money, mostly from family and friends, to pay their rent.

Mr Morris said: “The basic problem in the North East is that we don’t have enough jobs paying a decent living wage and offering decent terms and conditions of service.

“The government should be directing more of its energies to securing economic growth in the North East rather than squeezing the local economy via cuts to the public sector and to social security.”

He highlighted a report called The State of the Coalfields, commissioned by the Coalfields Regeneration Trust, a government-backed charity, which warned former coalfield areas required continued support to help people into work.

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