Changes to jobseeker’s allowance (JSA) designed to further encourage claimants into employment will be moved at the July sitting of Tynwald by Bill Henderson MLC, political member of the Treasury with special responsibility for social security matters.

The changes include:

• reducing the rates of JSA for jobseekers who do not have to pay housing costs;
• incremental reductions in the rates of JSA for jobseekers who have been signing on for more than 6 months;
• scrapping the current rule whereby a jobseeker who takes up temporary work of 16 hours or more a week - with a view to improving their prospects of getting a full-time job - loses all their JSA.

Mr Henderson explained: ‘In his Budget speech in February this year, the Treasury Minster pointed out that the rates of income-based JSA payable on the Island are significantly higher than in the UK. He announced a review to look at reducing the rates of income-based JSA either across the board, or on a targeted basis.

‘Since then the Treasury has carefully considered where our allowances might act as a disincentive to returning to work and where reductions should therefore be made. We have concluded that people who do not have housing costs – generally those who are living with family or friends – do not need the same level of support as those who are living independently who have to pay housing costs, so we intend to introduce lower rates of JSA for such people. The Treasury has also concluded that JSA should be reduced incrementally for all jobseekers after they have been unemployed for 6 months.’

Subject to Tynwald’s approval, the lower allowances will come into effect from November 1 this year and all jobseekers will be advised immediately of the changes. Abolition of the ’16-hour rule’, to support those trying to return to full-time employment by way of temporary work, would be effective from August 9, if approved.

Mr Henderson concluded: ‘If approved, these changes will result in a growing advantage to being in work and earning, rather than staying on benefits, and will provide the added incentive some jobseekers need to find a job and leave benefit. Some jobseekers may need to re-double their efforts to find work if they are to avoid a reduction in their benefits. Furthermore, it is Treasury’s intention to now look at whether some of the changes being introduced for jobseeker’s allowance might also be mirrored in income support’