Bold thinking on welfare is right - and popular Iain Duncan Smith closed the week with a stark warning to new migrants: anyone whose English is too poor to find work could lose their benefits. It is part of an effort to clamp down on "benefit tourism" prior to the lifting of work restrictions on Romanians and Bulgarians in the new year. This is a politically smart move but also, considering the cost of welfare to the Treasury, an economically sound one. This week George Osborne also announced that he wants to find "billions of pounds of welfare savings" to cover coming shortfalls in other areas of public spending, to pay down the deficit and to cut taxes. Polling shows that such a move would be incredibly popular right across the country, giving the Tories a clear edge over a Labour Party that has refused to take any constructive position on welfare. Back in October, a recording leaked out of a private meeting organised by the TUC and addressed by James Morris, a polling expert and speechwriter for Ed Miliband, in which the pollster warned that more than two thirds of voters in marginal constituencies back the Government's drive to save money. Crucially, Mr Morris said that they see this not just as a financial issue but a "moral" one, too. He explained that voters feel that even if the budget was in surplus and the Treasury overflowing with gold, they "don't think that you should give something to people who don't deserve it." That view makes a great deal of ethical sense. It is unfair that those who work and save should have to finance the lifestyles of those who choose not to. But, under the present circumstances, frugality also happens to be a financial necessity. Growth and employment may be rising, but the structural deficit remains - and the welfare budget is responsible for an eye-watering proportion of it. According to the Institute for Fiscal Studies (IFS), spending on benefits, tax credits and state pensions now accounts for around 30 per cent of all government expenditure. There was a significant leap in costs under Labour, when Gordon Brown as chancellor introduced a complex mosaic of tax credits, freebies and top-ups. The IFS calculates that some £12 billion in welfare savings needs to be found to ensure cuts to other departments do not accelerate in the next parliament. Crucially, sandpapering the bill down by focusing on small, individual entitlements will not make much of a difference. The winter fuel payments and free TV licences cost just £2.8 billion - so means testing those things will save money but not solve the problem overnight. The really big expenditures are to be found in pensions (£63.4 billion), tax credits (£28.8 billion), out-of-work benefits (£19.5 billion) and housing (£17.1 billion). To make a real difference, the Government needs to look at wholesale reform. This might demand a bipartisan approach, such as a royal commission. The IFS recommends more means-testing, freezing and simplifying of current benefits. The tax credits system certainly is hopelessly complicated, with countless cases of people being overpaid or underpaid. Simplification should be the first stage towards reducing costs - and the good news is that this is the underlying ambition of the Government's Universal Credit idea, even if it has been dogged by poor management. Something else worth exploring is David Cameron's promised "earn or learn" approach, whereby the under-25s will be stripped of their right to sign on to the dole to encourage them to stay in education or to seek work. Labour was initially reported to be flirting with abolishing benefits for the under-25s, too, but then denied they ever thought such a thing possible - another example of their political cowardice. Whatever the Tories do, they must be bold and think big. They must also be far cleverer about pursuing welfare reform than they were in the past. The political fallout of their war on the so-called bedroom tax is an example of how not to approach the debate. The defenders of the status quo should never again be allowed to paint themselves as the conscience of the nation. On the contrary, morality and reason are on the side of those who seek to reform the welfare state in order to protect those who really need it.