At last, some new thinking on welfare reform
September 17th, 2009 by Moussa Haddad Posted in Welfare reform, livelihoods, uk poverty
Yesterday saw the launch of what the Centre for Social Justice describes as ‘the most far-reaching review of the UK welfare system in 60 years’. The report, Dynamic Benefits, sets out plans for a near cost-neutral rebalancing of the system, largely focuses on smoothing out the tapers of benefit withdrawal rates and subsequent entry into the tax system.
So what to make of it? Well, I can’t claim to have studied each of its 370 pages in depth just yet, but initial impressions are very positive indeed. This is all the more refreshing since thinking about welfare reform in the political mainstream has become stuck in a rut, and the two main parties have for some time now been engaged in a destructive, macho contest to appear increasingly ‘tougher’ on benefit claimants than one another.
The report’s Big Idea is to start from the premise of humanising benefit claimants – of assuming that they think like everyone else. I wasn’t alone in spotting the hypocrisy whereby we were told that, to get the CEO of a major corporation to work harder, you pay him more; and to get an unemployed person to work harder, you pay him less – and then punish, moralise at, and bully him until he gets a job. This report takes the centre-right logic of people being motivated by financial reward, and applies it to poor people (both out of work and working for a pittance). ‘Employment and career progression above all has to pay, and if we understand that this is part of what motivates those already in work, why do we seem to expect something altogether different of benefit claimants?’ I could have picked any one of a number of statements from a strikingly humane foreword to the report by Iain Duncan Smith.
The end result is something that looks a bit like a cross between a Citizen’s Income and the current system. Increasing earnings disregards, slowing the rate at which benefit is withdrawn and tax paid, and simplifying the complexities in the system, not least around changes in circumstances and in income from week to week, should have a series of benefits. It should bring into the mainstream some of the vast potential that is currently directed towards the informal economy by making it easier for people to take on small amount of work; and it should help to make the benefit system a more effective social security net, by reducing the financial uncertainty that is at present attendant when taking on the short-term, part-time, insecure work that is often all that is available. Above all, the proposals in the report are designed to stop the benefit system being a barrier, and a trap that keeps families and communities locked out of the social and economic mainstream, often across the generations.
The message that comes loud and clear from this report, and which I would echo, is that fixing the benefit system requires new ways of thinking. And, in so far as it goes, the proposals contained in it are to be welcomed – and represent a step-change on what’s gone before. There are one or two notable omissions, however. The report focuses on two things: work and money. We would argue that other things are important. There’s precious little discussion of the value of unpaid work – of volunteering or caring – or of the need for people to develop their non-financial assets, which would mean straying at least some way from the ‘any job is a good job’ mantra. The proposal not to decrease any benefit levels is positive, but some attention could be paid to how low benefit levels truly are – and the effect that this can in itself have in turning the shock of losing a job into a life-altering crisis. There is also a predictable focus on promoting couple formation as a ‘positive life choice’, which confuses cause and effect.
Yet these are perhaps questions for another day. In promoting a radical overhaul of the benefit system, based on an understanding of the ways, financially at least, it fails poor people, the CSJ have moved the debate on welfare reform into more potentially fruitful territory. Its message that the recession is no time to shy away from reshaping the foundations of our future society chimes with a lot of what we said in our response to the crisis. We must hope now that policy makers engage with the ideas in this report, and treat it as a wake up call. Poor people, and people working in the anti-poverty sector have long known that the benefit system is no longer fit for purpose. Yesterday’s intervention is an encouraging sign that, just maybe, that message is filtering through into the political system.
5 Responses to “At last, some new thinking on welfare reform”
By Will on Sep 17, 2009
Moussa, a great analysis. I agree they’ve shifted the debate, not just in politics but perhaps also in the media – a spate of editorials yesterday decrying the barriers to moving into work, where in the past they’ve focussed on the supposed laziness of benefit claimants.
Also agree that it in developing this theme further they need to look beyond the narrow confines of the benefits system into areas like the informal economy (my suggestions here http://www.community-links.org/linksuk/?p=1055), the types of jobs available, and the value of work that is currently unpaid – caring and volunteering particularly. Are you hopeful?
By Niall Cooper on Sep 18, 2009
I too am impressed with Iain Duncan Smith’s bold ideas for radically simplifying the benefits system published today. These proposals are not only timely but will be welcomed by all those find the current benefits system too complicated.
Church Action on Poverty has long argued for a major overhaul of the benefits system to re-design it around the needs of those who use it.
For decades the benefits system has given every appearance of being designed by and for experts. It is certainly impossible for the majority of its users to understand. Claimants are often unclear of the effect that taking work will have on their benefits – many assume that this will result in their losing all benefits entitlements. The existence of so many different benefits, each with a separate regulatory regime may make bureaucratic sense, but it makes absolutely no sense to claimants.
Ian Duncan Smith’s proposals are a major step in the right direction and should be welcomed by people of goodwill across the political spectrum. We will be calling on both David Cameron and Gordon Brown to give these proposal serious consideration.
By Herb Skew on Sep 28, 2009
I haven’t read the 370 page report either, but I can guess the sort of social tinkering a Tory thinktank might make. They don’t have a good track record here, and never will as they simply will never understand.
But the more lateral aspects of the welfarism of today have, unfortunately, become a way of life to many people. Of course, it is not fit for purpose, I am not defending it – and in the future they will probably[hopefully?] compare it to Speenhamland.
What’s frustrating is that successive administrations have made welfarism essential – not just to the Tories out-dated ideals of Victorian economic family units – but to individuals. We are a society of individuals [which might allude to some of the moral implications around stereotypes of the workshy; I thought it was very well examined in the blog].
Sadly, the reward from working, particularly for a pittance, has diminished the dignity of work and significantly destroyed trust and faith in the openness of society. New Labour has felt like a vapid continuum of Toryism I was hoping to see consigned to the past.
It, also, needs to be noted that when we address welfarism so generally, we need to look at our so-called meritocracy also. We don’t really live in a fair society, despite society – politicians more so – constantly telling us it is fair. Equal opportunities in the 21st century is a cruel PR[& PC] gimmick for the poor – to keep them poor.
However, Will raised an interesting point about the informal economy, looking beyond means-testing and benefits, and this might help stimulate how Britain attempts to emulate the traditional models of Americanized wealth creation, particularly as the real harrowing fact is that there are quite simply not enough jobs here. Generations will be lost again, as the cycle revolves again with insecurities remaining about the depth of the “recession”.
But I enjoyed reading this analysis – thanks for the honesty. But for me to become positive about it, I think changes throughout many aspects of our apparently liberalized capitalist-democratic society need to be vigorously altered.
By Jill Love on Oct 8, 2009
I haven’t read the report either, in fact as a recipient of JSA I didn’t know there was one.
That to me is the nub of the problem, we become disenfranchised, set apart, poverty and joblessness are disfigurements that strike to the very soul, most of us try anything to conceal it, especially to ourselves.
I found this site because I was looking up on identity, how we see ourselves and how others see us. The ways in which benefit claimants and the low paid are spoken and written about are at best patronising and at worst downright libellous and slanderous. So why don’t we rise up as a body and take everyone else to court? Simply because we don’t want to be included in the group, as individuals we can all provide evidence that we’re not workshy, lazy, unworthy, scrounging ne’erdo wells but the bad PR has us thinking that probably the rest are.
Any government recognises the need for an underclass, a disposable element,a good guy versus bad guy, they know that our society bereft of any real commitment other than to self can only work where division exists, I don’t want to be better than I am I want to be better than you.
So a new report, great! but I fear no real change.