There will also be a £26,000 annual cap on benefits per family and sanctions for those who refuse work of up to three years withdrawal of payments.
Certainly the man behind the reforms, former Tory leader Iain Duncan Smith, is a brave and innovative thinker. But is he being radical enough?
The benefit cap, for example, seems a good idea. But £26,000 is more than the average wage – and those in work have to pay tax on that money, while those on handouts don’t.
To take home £26,000, a worker would have to be on an annual salary of around £35,000. No wonder that many families are better off not working.
And haven’t we heard dozens of times before that there are going to be “tough sanctions” on those who refuse to work? It never amounts to much.
There is little wrong with Duncan Smith’s analysis of the problem. The UK has one of the highest rates of welfare dependency in the western world.
About six million people – fully a tenth of the population – rely on handouts from the taxpayer at a cost that has grown from £125bn in 1996/7 to £187bn in 2009/10.
And unlike the unemployment spikes of the 1930s, this has little to do with economic conditions. During the recent boom millions of jobs were created, but most of them were taken by workers from overseas. Welfare is now seen not as the temporary safety net the Beveridge Report of 1942 envisaged, but as a lifestyle choice.
In some parts of Britain, there are three or four generations of families who have never known what it’s like to get up in the morning and go to work.
The problem is so deep-seated that it requires an even more radical solution.
This week on the BBC’s Newsnight programme, academic Lawrence Mead outlined the “tough love” approach to welfare that was stunningly successful in the US in the 1990s.
Instead of payments being handed over as of right, claimants only received benefits if they were prepared to work.
State help – in the form of child care, income top-ups and training – was still available, but only if you worked.
Work was an obligation, not an option. If you refused a job, you received nothing.
The results were nothing short of spectacular. The number of benefit claimants was reduced by over two-thirds and in Wisconsin it was 80 per cent.
Even more impressive was the fact that people didn’t slide into poverty. No-one starved; children were not abandoned in the gutter. Quite simply the unemployed took the jobs that were available.
This was good not only for the taxpayer, but for the unemployed too. This is because the only way out of poverty is through work. For Britain to leave six million people rotting on welfare is simply shameful.
ARE we really seeing a flowering of freedom in the Middle East at last? It would be marvellous to think so.
For years, with the exception of tiny democratic Israel, the region has been dominated by corrupt thugocracies and repressive regimes.
Now, with the revolutions in Tunisia and Egypt, there is hope of change for the Arab and Persian peoples.
But it is one thing toppling a comparatively benign dictator like Mubarak, but an entirely different task to take on the ruthless and desperate monsters that rule Iran, Syria and Libya.
The sad truth is that the very worst regimes, where reform is needed most, are the ones that are most unlikely to taste freedom.