The new rule will require benefit claimants to work up to 15 hours a week to take new measures to boost their earnings or face a cut in benefits. The current limit is nine hours, although it was increased this summer to 12 hours, which will come into effect next week. The further increase, due to be implemented from January 2023, will affect only a small extra number of universal credit recipients, around 120,000 people out of around 5.5 million who claim the benefit. But the move is meant to signal a fresh attack by the Treasury to fill job vacancies, with many industries facing chronic shortages. Kwarteng will also announce new employment support for the over-50s, following a sharp rise in economic inactivity in this age group since the Covid-19 pandemic, with significant numbers citing stress or mental health reasons. The Treasury found that economic inactivity in the over-50s is a major contributor to labor market shortages, one of the key issues driving up inflation. “Our labor market is extremely resilient, but it’s not perfect,” Kwarteng said before the announcement. “While unemployment is at its lowest rate in nearly 50 years, high vacancy rates persist and labor market slack are constraining economic growth. “These incremental changes are focused on getting people back to work and maximizing the hours they need to help grow the economy and improve living standards for all. It boosts incomes for families and helps businesses get the domestic workers they need, while supporting economic growth.” The changes will be announced in Kwarteng’s mini-budget on Friday, along with a number of other measures, including major tax cuts and further details of the energy package to support households and businesses with bills. Benefit claimants working up to 15 hours a week on the National Living Wage must now meet regularly with their work coach and take active steps to increase their earnings or face a reduction in their benefits. Archie Bland and Nimo Omer take you to the top stories and what they mean, free every weekday morning Privacy Notice: Newsletters may contain information about charities, online advertising and content sponsored by external parties. For more information, see our Privacy Policy. We use Google reCaptcha to protect our website and Google’s Privacy Policy and Terms of Service apply. Job coaches will require applicants to make commitments such as applying for jobs, attending interviews or increasing their hours. Chloe Smith, the work and pensions secretary, said the aim was to tackle shortages in the labor market and help people on lower incomes increase their pay. The changes will affect the UK and some groups will continue to be exempt from penalties, including people who are unable to work due to long-term illness or disability.
