Some £2bn of resources will be spent on introducing a universal benefit to replace all means-tested working age benefits in a shake-up of the welfare system.
Chancellor George Osborne, in his speech delivering the comprehensive spending review today, told the House of Commons that the Department of Work and Pensions is looking to phase in a “simple, single, universal benefit” to replace all working age benefits.
This “universal credit” will be implemented over the next two parliaments.
Osborne said: “The guiding rule is this means it will always pay to be in work.”
The Government has also outlined a package of welfare reforms worth £7bn a year, including a cap on the maximum level of benefits a family can claim.