If ministers want to see how welfare reform can be done, come see us in Greater Manchester

The Guardian

09-07-2025

One consequence of the recent debate on disability benefits should be the acceptance of a shared responsibility across the Labour family to support the government with alternative approaches to welfare reform. Here in Greater Manchester, where there was strong opposition to the cuts, we accept our responsibility entirely.
As clear as the case is for some form of wealth taxation, it would be wrong to make that the only response. The Department for Work and Pensions system didn't work for people before last week's debate and it still doesn't now. What is needed is a unifying version of reform, and we think we can help with that.
With a decade of devolution behind us, Greater Manchester is ready to step forward as the UK's first 'prevention demonstrator', showing how we can prevent poor outcomes for residents and rising costs of public services. We are proud to have received that official designation from the government in the 10-year health plan for England, and we are confident we can live up to it.
The time has come to break with Whitehall business as usual and build an entirely new model of support. One of the many problems with Whitehall's approach to welfare reform is trying to solve the complex issue of getting more people into work from within the narrow policy silo of the DWP when, in truth, the answers are much more likely to lie outside.
This is where Greater Manchester starts. We recognise that the barriers to work our residents face are often linked to issues like housing, personal debt and mental health. Consequently, a whole-person, whole-system approach is the only one that stands any chance of working. This is the philosophy upon which our prevention demonstrator is based – a bottom-up, names-not-numbers approach to supporting people with the essentials needed for a good life. At its heart are three big ideas which we believe, if carried out to their fullest extent, could together score the savings the Office for Budget Responsibility needs to see, as well as financing the removal of the two-child benefit cap.
Whereas the Whitehall version of reform focuses on people, and crude cuts to headline rates of support, ours begins with bricks and mortar. I am stunned by the extent to which the media debate on benefits underplays the impact of the housing crisis. It inflates the benefits bill by multiple billions – but is also entirely fixable.
The new Greater Manchester strategy, published today, is anchored on the idea of a 'housing first' city region. Without the foundation of a good home, everything in life becomes more difficult for our residents. From now on, housing will be recognised as pre-eminent in public policy. Freeing our city region from the grip of the housing crisis will be our number one priority.
What does that mean in practice? It means, for instance, reaching a new tipping point within two to three years of building more social homes than we are losing, alongside a much tougher approach to improving standards in the private rented sector through our new good landlord charter.
In an ideal world, we would go much further. The vast majority of the £39bn announced for housing at last month's spending review should be focused on a drive to build a new generation of council homes, rather than subsidise private housing. The evidence is compelling. A 2024 study for the National Housing Federation, carried out by the Centre for Economics and Business Research, found that building 90,000 new social homes would save £3.3bn a year in universal credit over the long term. If the government worked with England's mayors and councils to scale that number up to 500,000, then the recurrent annual saving to the benefits system gets closer to £18bn.
Building on this new approach to housing, the second part of our prevention demonstrator involves a paradigm shift in employment support, moving away from a distrustful, tick-box system and towards a more empowering Live Well approach.
How is a system which people fear having contact with, and often leaves them feeling worse about themselves, ever going to help them into work? The answer is it won't. Years of tough-on-benefits rhetoric has created a system which people see as being there to trip them up rather than help them out.
The only answer is to turn it on its head. We must start with places people trust at a local level, such as community and voluntary organisations, and with the issues in people's lives that are the true barriers to work. This is the essence of Live Well. We know there are thousands of people in Greater Manchester who have completely disengaged from the DWP but, if helped in a different way and particularly with issues that are destructive to their mental health like personal debt, could be supported into work.
Our third focus is young people. The appalling statistic of 1 million people not in education, employment or training stands as a damning monument to an education system in England built for some young people but not all. The obsession with the university route, and the failure to provide equal technical paths, leaves many teenagers feeling lost in the middle years of secondary school. Our plan for the Greater Manchester baccalaureate, or Mbacc, seeks to fix that with the guarantee of a 45-day work placement for every young person who wants one.
We are confident our prevention demonstrator, in its entirety, could significantly reduce reliance on the benefits system and other public services like the NHS. We have never truly tried prevention in this country. If there was ever a time to give it a proper go, surely it is now?
Andy Burnham is the mayor of Greater Manchester. He served as the Labour MP for Leigh from 2001 until 2017