Tories would prevent long-term jobless spending benefits on alcohol and cigarettes

The Conservative Party has unveiled a plan to slash Universal Credit for long‑term unemployed claimants by 30 % and to channel the reduced payment onto a “Back to Work” prepaid card that cannot be used for cash withdrawals or purchases of alcohol, cigarettes or gambling. The measure targets people who are deemed fit to work but have been jobless for more than six months and have not contributed enough to the system; about 350,000 claimants would be moved onto the lower rate, saving an estimated £538 million a year. Those with a solid employment record, the sick, disabled or already in work would be exempt, while anyone who has previously worked would retain full benefits for an additional year every two years. The card would function similarly to the Aspen card used for asylum seekers, which restricts contactless, telephone and internet payments and limits the retailers where cash can be taken out.

The proposal is presented as a way to curb the “soaring” welfare bill and to incentivise job‑seeking, with Conservative leader Kemi Badenoch arguing that the current system rewards people who can work but choose not to, creating an unfair advantage over employed taxpayers. The party estimates the reforms would contribute to a £50 billion reduction in welfare spending, alongside other cuts such as scrapping Personal Independence Payment for low‑level mental health conditions and tightening sickness‑benefit eligibility. Labour has dismissed the scheme as “unworkable,” noting that the Conservatives have had 14 years to reform welfare without delivering meaningful change, and the party’s own figures show benefit spending is projected to rise to £408.6 billion by 2030/31.

Critics from the anti‑poverty sector warn the cuts will deepen hardship, arguing that Universal Credit already fails to cover basic needs like food and heating and pushes many into food‑bank reliance. Helen Barnard of the Trussell Trust called the plan “deeply misguided,” saying it would damage health and undermine the ability of claimants to find and keep work. The government has not detailed how the card will operate, but it points to similar systems in Australia that block purchases of alcohol, tobacco and pornography. Conservative economy spokesman Robert Jenrick conceded that the reforms would not significantly dent the overall welfare bill, while Labour’s shadow welfare secretary Helen Whately suggested the scheme would mirror the Aspen card used for asylum seekers, which has already faced criticism for restricting cash access and limiting retailer options. The debate underscores a broader political clash over how to balance fiscal restraint with the need to protect vulnerable households amid rising benefit costs.

⚡ Effects Interpreter