Better Off in Work Credit

Work and Pensions written statement – made on 20th May 2008.

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Photo of Stephen Timms Stephen Timms Minister of State (Department for Work and Pensions) (Employment and Welfare Reform)

The Command Paper, "Ready for Work: Full Employment in our Generation" (published 13 December 2007) announced that the Department will pilot a Better Off in Work Credit (BWC) in October 2008. The purpose of the credit is to encourage customers to obtain and retain employment by ensuring that, on moving into full time work, they will receive an in-work income (including in-work benefits and working tax credit) of at least £25 a week more than they received from their out-of work benefits. The credit will be paid by Jobcentre Plus for up to a maximum of 26 weeks. It will be available to customers who have been receiving incapacity benefit (employment and support allowance on its introduction), income support, jobseeker's allowance or severe disablement allowance for at least 26 weeks prior to obtaining work. We estimate that nationally this could help approximately 110,000 people, about 35,000 of whom will have children.

Today I can announce that Jobcentre Plus will pilot the new measure in all districts in the Yorkshire and Humber region, a total of 59 Jobcentre Plus offices. We estimate that there are around 12,000 individuals who would be eligible for the credit each year in the Yorkshire and Humber region.

Following evaluation of the pilot we will look to extend the credit nationally in 2009.