Politics: Harman plans work-ethic route to welfare reform

The Government's `big issue' is social exclusion, the Social Security Secretary said yesterday. Glenda Cooper, Social Affairs Correspondent, looks at Harriet Harman's plans to combat a divided nation.

Harriet Harman yesterday ruled out higher benefits as a way of tackling unemployment saying that the welfare state would be "reformed around the work ethic".

"We want to make the mainstream economy - with its opportunities and its risks - the main path out of exclusion for all people of working age," she told an audience at the launch of the Centre for Analysis for Social Exclusion, an independent unit at the London School of Economics.

The centre was opened as the Government sets up its own social exclusion unit in the Cabinet Office. Ms Harman said that the two events were "enabling the academic world and the Government to come together to confront what is the big issue of this administration".

"Work is the only route to sustained financial independence. but it is also much more," she said. "Work is not just about earning a living. It is a way of life.... [We will] ensure that work pays wherever possible by implementing a national minimum wage and reforming the tax and benefit systems."

Saying the Government wanted to rebuild an "one- nation" society, she defined the socially excluded as those deprived of work, education, material goods, transport, healthcare and financial services..

The ESRC centre will use newly available national survey data to follow people from year to year to investigate how their incomes change and look at issues such as the long-term effects of changing family patterns. It will also track the fortunes of particular areas to explore why some people improve and why some are locked in deprivation. "It is crucial that we understand how the areas in which people live affect their lives and life chances," said Dr Anne Power who will co- ordinate the research.