David Freud, Baron Freud

File:Lordfreud.jpg

David Freud, Baron Freud

David Anthony Freud, Baron Freud, PC (born 24 June 1950) is the Minister of State for Welfare Reform in the Conservative Government of the United Kingdom. Before he joined the Conservative Party, he advised New Labour on welfare reform during its final term of office. He is a past vice-chairman of investment banking at UBS.

Early life and education

Freud is a great-grandson of the psychoanalyst Sigmund Freud. He attended Whitgift School in Croydon, South London. He then studied Politics, Philosophy and Economics at Merton College, Oxford.

Career

Journalism

After starting out at the Western Mail, Freud worked at the Financial Times for eight years as a journalist.

Finance

In 1983 he was hired by the stockbroking firm then known as Rowe & Pitman. Later, he worked for S G Warburg, which was taken over by UBS. He was vice-chairman of investment banking at UBS before he retired.

His book Freud in the City describes his life as a merchant banker.

Welfare policy

In 2006, Freud was asked by Tony Blair to review the UK's welfare-to-work system. The Daily Telegraph said that Blair had been "impressed by his role in raising finance for Eurotunnel and EuroDisney" while at UBS.

Freud's 2007 report - dubbed 'the Freud report' but officially titled Reducing dependency, increasing opportunity: options for the future of welfare to work - called for the greater use of private sector companies who would be paid by results, for substantial resources to be made available to help lone parents and people on Incapacity Benefit back into work, and for a single working-age benefit payment to replace Housing Benefit, Jobseekers Allowance, etc. His central thesis was that spending on 'delivery' - such as schemes to get people back to work - would save money in the long run because there would be fewer people being paid money in the form of benefits. Freud wrote:

Given the active labour market policies now pursued in the UK, there is a close link between effective expenditure on employment programmes and expenditure on working age benefits. Effective spending by the [DWP] on labour market policies or administration can result in real reductions in benefit expenditure (and vice versa)

His ideas foreshadowed the Work Programme and Universal Credit.

The Daily Telegraph has claimed that "many of [Freud's] ideas fell victim to the fierce infighting between Mr Blair, the then Prime Minister, and Gordon Brown, his Chancellor".

In 2008, during the banking crisis that had begun the previous year, Freud became a formal adviser to the New Labour government led by Gordon Brown. The Daily Telegraph said Freud was then asked to "help implement nothing less than a revolution in the welfare state" after a "sea change in Labour's thinking about the benefits system". His ideas were incorporated into a White Paper published later that year.

Politics

By February 2009 the BBC was referring to him as Sir David Freud, at which point he announced that he would switch to working with the Conservatives - the culmination of what The Guardian described as a "tug of war" between the two main political parties over Freud. The newspaper also said that the move was "an apparent demonstration of his belief that the Tories are more likely to implement his radical reforms". On 27 June 2009, he went from knight to lord after his name was put forward by the Conservative leadership. He then became a shadow minister in David Cameron's frontbench team.

When the Coalition Government was formed in 2010, Freud was made Parliamentary Under Secretary of State for Welfare Reform at the Department for Work and Pensions (DWP).

In 2012, he outlined some of his thoughts on welfare reform in an interview by saying: "People who are poorer should be prepared to take the biggest risks, they've got least to lose. We have, through our welfare system, created a system which has made them reluctant to take risks, so we need to turn that on its head and make the system predictable so that people will take those risks". In the same interview, he said his primary concerns were the "nooks and crannies" in the benefits system where people could sit for long periods without ongoing scrutiny. He claimed the people who did this were: "The incapacity benefits, the lone parents, the people who are self-employed for year after year but only earn hundreds of pounds or a few thousand pounds, the people waiting for their work capability assessment then not going to it - all kinds of areas where people are able to have a lifestyle off benefits and actually off conditionality".

In 2014, Labour MPs called for Freud's resignation after he was secretly recorded responding to a question posed at a fringe meeting of the Conservative Party conference. The question was whether some people with disabilities should work for a token sum in order to enjoy the non-financial advantages of engaging in the world of work, perhaps with their wages topped up by benefit payments. Freud, thinking out loud, agreed that there was a small group of disabled people who were "not worth the full wage" and said he would go away and think about it. Freud had to apologise. He said: "I was foolish to accept the premise of the question...I care passionately about disabled people...that is why through Universal Credit...we have increased overall spending on disabled households by £250 million, offered the most generous work allowance ever, and increased the disability addition to £360 per month".

After the Conservatives won the general election in May 2015, Freud was promoted to Minister of State at the DWP, where he was given an enhanced role in overseeing the expansion of the Universal Credit scheme.

Other appointments

Along with the late Sir Martin Gilbert, Freud has acted as a long-term trustee of the Portland Trust, a not-for-profit London-based foundation set up to promote co-operation between Israel and Palestine through economic development. Between 2005 and 2008, he was its chief executive.

External links

• Lord Freud – TheyWorkForYou