Winning the welfare war

The conservatives are ahead
February 22, 2012

Conservatives are winning hands down on welfare. The bishops in the House of Lords led a successful rebellion against the totemic £26,000 benefits cap—their aim was to prevent child benefit from being limited along with other welfare payments. But the government may force the cap through the Lords anyway. Labour and the Lib Dems are quiescent. Jobless, and poor people more generally, rarely vote, making them politically, as well as economically, marginal. The recession has not made people in work feel more generous to those out of work.

The sense that people should “pull their socks up” has a long history. The Tudor Poor Law put the able-bodied poor to work. Those able but unwilling to work could be sent to a House of Correction or prison. The Christian concept of “stewardship,” a responsibility to work productively as best we can, meant that idleness and begging were seen as worthy of punishment.

The Victorians were harsher still. The able-bodied were put to work in circumstances so unpleasant only those without alternatives would seek support. The workhouse divided husbands from wives, parents from children. Supper at the Huddersfield Workhouse always consisted of flour or oatmeal, boiled in “old milk.”

The 20th century changed all that, starting with the Liberal government’s 1906-14 welfare reforms. In 1914, 14m free school meals were served. A quarter of secondary schools places were free. Probation replaced prison for some young offenders. An additional £10 per child tax allowance was created. Pensions were introduced for the elderly—although at a low level to encourage saving. Job centres were created, and the National Insurance Act offered 26 weeks’ sickness and 15 weeks’ unemployment insurance to those who paid in.

The 1945 Labour government built on these reforms to create a welfare state that offered a safety net “from cradle to grave,” creating a sense of “social security” to complement the traditional security maintained by diplomacy and military means. The government was to vanquish the five “giant evils” of “Want, Disease, Ignorance, Squalor and Idleness.” Idleness was still seen as a legitimate enemy, but it was government that would conquer it through Keynesian economics. Individual unemployment was now viewed as bad luck, not fecklessness.

The model was based on the nuclear family, with a working husband who provided for his wife and children. Firms often had marriage bars, requiring women to give up work after their wedding. Most women who became pregnant out of wedlock faced pressure to marry. Men, in turn, were expected to work, and jobs of all skill levels were widely available. They received the “married man’s” tax allowance, and paid national insurance to cover unemployment and ultimately provide a pension for them and, later still, a reduced pension for their widow.

The era of the working husband and stay-at-home wife is largely gone, as the last generation has seen the number of two-earner households overtaking the number of single earner households. We have also seen a doubling of the number of households with no earners at all. The number in work has increased, but has become less evenly spread across families. In addition, there are 2m lone parents, caring for one in five of Britain’s children.

The availability of work for unskilled men is far, far lower. More people are employed in Britain than ever before, but not more men. There is no reason why men cannot work in care homes, retail, or childminding, but they don’t tend to, and many employers seem to prefer women for most of these tasks.

The welfare state has new challenges—lone parents, and the long-term unemployed. Imagine a lone parent—who may or may not have once had a partner—with five children. It is easy to say that she should not have had five children, but the reality is that she does. Should society require her to work? If so, for how many hours a week? What about the children in holidays, and after school? Consider too a low-skilled unemployed middle-aged man, in an economically depressed area. Should he be forced to move, starved into submission, or tolerated?

The previous government made work pay, chivvied the unemployed, but ultimately let them choose. The lone parent with five children, living in council housing, will not see her benefits drop by a penny if she works 16 hours a week at minimum wages. No tax or national insurance are payable either, so she literally gets to keep every penny she earns. Work pays.

A single unemployed man, living in a cheap part of Britain sees his income, after rent and council tax, rise by three-quarters if he takes a minimum-wage job. Again, work pays and anyone who says otherwise doesn’t know what they are talking about.

Yet many people are not in work. Some are feckless. Some really cannot find work. Others believe their children need them at home. It is hard to distinguish between these groups, so society has a choice: do we let the feckless get away with it, to protect the unlucky, or do we penalise the unlucky to bear down on the feckless? The question has always been the same: in Tudor times, in Victorian times, in 1945 and today.

For the past 100 years we have generally tolerated the feckless to protect the unlucky. This government has decided to do the opposite. The conservative agenda—never generous on welfare—is in the ascendant, for the first time in more than a century. Whether the new consensus lasts, of course, is another matter.