David Cameron's claim of £1.2bn saved via families plan labelled 'pure fiction'

PM with media

David Cameron’s claim to have saved taxpayers £1.2bn by turning around the lives of almost 117,000 of the country’s most troubled families has been dismissed as “pure unadulterated fiction”.

The prime minister used a welfare speech on Monday to trumpet the success of a programme, led by the civil servant Louise Casey, in helping family members into work and improving children’s attendance at school.

He also confirmed plans, first announced in 2013, for the programme to be extended to a further 400,000 families.

During the speech in Runcorn, Cameron said: “Our troubled families programme, under Louise Casey, has changed lives. By radically changing the way we deliver services to the hardest-to-reach families in our country, we have tackled worklessness, addiction, truancy and antisocial behaviour. And I can announce today that almost all of the 117,000 families which the programme started working with have now been turned around – in terms of either school attendance or getting a job or both.”

Jonathan Portes, an expert at the National Institute of Economic and Social Research (NIESR), said the figures were not being sufficiently challenged, either by the Labour party in opposition or by the media.

When the last official figures were published in March, showing 104,000 families had been “turned around”, Portes said he doubted even North Korea’s statistics office would have such cheek and branded the whole episode “disgraceful”.

Portes said the government’s claim that the programme had saved taxpayers up to £1.2bn was “pure unadulterated fiction”, and part of the problem was that the figures produced by the government were classed as experimental and therefore not verified by the UK Statistics Authority.

Portes said one possible reason for the Labour party’s lack of prominent opposition to the scheme was that many Labour-controlled councils were getting extra funding for their perceived success under it. Councils and third-party providers share identification success fees of around £4,000 per family when they successfully manage to turn around each household.

“A lot of Labour-controlled local authorities have got quite a bit of money out of it,” Portes said. “There is a bipartisan consensus that this is a good programme. Maybe it is, but we just don’t know.”

Cameron’s speech placed a heavy emphasis on the government’s approach to the family, saying he was increasing funding for relationship support and was committed to supporting the troubled families programme.

He also delivered a strong indication he intends to launch an assault on tax credits as he pledged to end the “merry-go-round” of welfare payments that means low wages are topped up by the state.

George Osborne, the chancellor, is due to set out £12bn of welfare cuts, which he is seeking to justify in terms of both reducing the deficit and incentivising work.

Cameron argued that Britain needs to move from a “low-wage, high-tax, high-welfare society to a higher-wage, lower-tax, lower-welfare society” and must tackle “complacency in how we approach the issue of low pay”.

“This is what I would call a merry-go-round,” he said. “People working on the minimum wage having that money taxed by the government and then the government giving them the money back, and more, in welfare. Again, it’s dealing with the symptoms of the problem, topping up low pay rather than extending the drivers of opportunity.”

The prime minister also said he would protect benefits for the “most disabled” people who cannot work, but he dodged a question on whether he would rule out any cuts to disability benefits.

Osborne confirmed on Sunday that he planned to press on with welfare reductions despite pressure from some of his Conservative colleagues to slow the pace of cuts and concern from bodies including the OECD about the impact on the working poor. Figures released this week are expected to show an increase in child poverty.

Alison Garnham, chief executive of Child Poverty Action Group, told BBC Radio 4’s Today programme that the impact of lower incomes for poor working families was already “stark”, with an extra 300,000 children expected to be living in poverty when the figures are published and 700,000 by 2020.

On Saturday, tens of thousands of people rallied against austerity in Parliament Square, central London, and in cities across the UK. Jeremy Corbyn was the only Labour leadership candidate to attend the protest.

Powered by Guardian.co.ukThis article was written by Rowena Mason Political correspondent, for theguardian.com on Monday 22nd June 2015 16.05 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010