The fabric of Britain as we know it is being ripped apart. So much is changing, almost behind our backs, we haven't got time to notice what is happening to us. And it is happening fast.

Thursday, 15 December 2011

From Cradle To Grave - The Death of the Welfare State

With all the talk about "benefit scroungers" and people living on tax payers money, I would like to take a moment today to think about what the Welfare State means.

In Britain a report published in 1942, the Beveridge Report became the blueprint for the welfare state as we have known and loved it for 70 years.

From Cradle To Grave

The report proposed that all working people should pay a percentage of their income to the state, which in return guaranteed to pay a small sum to the unemployed, the sick, the retired and the widowed.

There was the hope that no British citizen should ever have to survive under an acceptable minimum standard of living.

The National Insurance Act of 1946 created a system of insurance against unemployment and sickness, provided maternity benefits and an pension for retired citizens.

Our beloved NHS was founded in 1948, providing free health care for all.

Margaret Thatcher proposed cuts to the welfare state, although they were actually less substantial than feared. The Thatcher years however was the beginning of a change in perception - the welfare state was no longer a "safety net", it became increasingly viewed as a lifestyle choice, funded by tax payers.

The Thatcher years were also the start of the Right To Buy - the selling off of local authority homes to tenants, and the British obsession with home ownership.

I propose that we try to go back to the beginning and look again at our welfare state as a positive thing, not as a drain on tax payers money.

What does the welfare state mean to you?

For me it is a security, that those who have been unfortunate in life must not starve or freeze. Those of us born in the post-war years have not known this fear, perhaps this is why we are so willing to decimate our welfare state.

"The moral test of a government is how it treats those who are at the dawn of life, the children; those who are in the twilight of life, the aged; and those who are in the shadow of life, the sick and the needy, and the handicapped." - Hubert Humphrey

Recently I have been thinking about the word "benefits". When you google "benefit definition" this is the result:

benefits3rd person singular present, plural of ben·e·fit

An advantage or profit gained from something.
Receive an advantage; profit; gain: "areas that would benefit from regeneration".

Yes, you can go on and be informed of the other meanings, but this was the first one that popped up and one that people seem to connect to the state benefits.

That the benefit recipients are making money, are gaining an advantage. Instead of it being seen as a necessary support for those who are in difficulties. Or as it has turned into, a necessary support for those who cannot afford to live in modern day Britain.

The reality is that so many people now need state support because the gap between their wages and their living costs is so huge.

Take a hypothetical family, living in London, both parents working. They rent a house that costs £800 a month, and have two children, for whom they are paying £300 childcare a week. They both earn the national average income of £21k.

Their combined net income is just over £2,600. For rent and childcare alone they pay £2k.

They have not yet heated their house, fed or clothed themselves or their children, never mind saved any money towards the British Holy Grail - buying a house. Or even towards their retirement. If they were at college then they may be paying back their student loan. The only way they can survive is by applying for tax credits or other benefits (many of which they will no longer receive after the welfare cuts bill goes through).

The welfare state was not designed to close this gap. It was designed to help those who had no income, who were sick and needy.

It is easier for the politicians and press to seize on the easy targets, the benefit scroungers, and present this to the public as the reason for the benefit cuts. Then we can all get angry at them. A guest blogger will be writing soon about this phenomenon.

I believe that there is an important issue that needs to be addressed, and as yet neither the Conservative/Lib Dem government, nor the opposition Labour party is doing this.

Why is there not more in the press about this? Forget about the benefit cheats, the bankers, the immigrants and any others currently being being blamed for the recession.

Lets talk about the fact that normal people in normal jobs simply cannot stretch their wages to cover the basics. This is not about holidays in the sun or a new BMW but about deciding whether to buy food or put the heating on. They are already shopping in Aldi and Lidl and forgoing holidays, unless it is a week camping in Wales.

We cannot abuse our welfare state to prop up the wages of those in badly paid jobs. It was not designed for this and it is no wonder that it is buckling under the strain.

A National Minimal Wage must be high enough to cover basic living costs. It is at currently £5.80 an hour, but needs to be well over £7 an hour.

According to the report by the Joseph Rowntree Foundation, the cost of living rose by 24% in the past year.

.. [the] Foundation found that couples, both of whom are working and with two children, would need £38,800 joint income to keep up a minimum standard of living.
This compares with £29,727 a year ago, an increase of 24 per cent in just 12 months. The charity estimates that 500,000 families fall into this category.

I don't believe that increasing tax credits is the answer to this.

Companies that have seen rising profits for years, such as Tesco, Sainsburys and Poundland should lead the way - by refusing to employ Workfare staff, by paying their staff fair wages, by paying farmers fair prices for their products.

Housing should be a priority for the government. Not half-baked Housing Strategies where millions will be set aside for the building of new homes, instead of renovating the thousands of empty homes. Or working with the banks to offer 95% mortgages, so that buyers only have to save 5% deposit without thinking that even that is beyond many families.

The rights of renters must be improved, so that people who cannot afford to buy a house can live in decent accommodation for a fair price. So that landlords cannot leave families living in a mouldy and downright dangerous house.

We need the politicians to take the lead. We need a strong Labour opposition to the cuts. We need the Conservative voters and politicians to call for a rethink. I do not believe that all Tory voters would approve of these cuts, if they had the full facts rather than the ConDem version of the truth.

We need to get the word out, because right now the wrong people are winning the propaganda war.

Get frothy. Pass this on to your friends. Inform your relatives about the reality of life on benefits. Tell them about Workfare, warn them that they are just an unexpected illness away from disaster, inform them how the proposed cuts will affect families with disabled children, and that if we take away their financial security, they will have to put their children into care, ultimately costing the taxpayer much much more. Ask them if they would train and work as a teacher if they knew that it would not enable them to live from their wages.

The next time you hear someone talk about how benefit scroungers need to be stopped, and that these cuts are the right thing to do, tell him to froth off and check out the FACTS.

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  1. Great article.

    In addition to supporting the sick and unemployed and universal healthcare provision via NHS, the other cornerstones of the Welfare State are supposed to be education and employment.

    The only problem is that one of those is under attack (education and the other has somehow become the responsibility of government through behind the scenes tax deals and Work Fare legalised slavery.

  2. Very, very good post. Thank you, MmeL. We do need for people - voters, administrators and politicians of all flavours - to get to grips with the big picture.

    Not only has the National Insurance taken over as an income prop for the underpaid, it's now taking on the entire burden of wages - with workfare. As a mechanism for redistribution of wealth, it's failing hopelessly and is about to fail spectacularly. As you say, it was never meant for this.

    We have a mechanism for wealth distribution as necessary. It's called tax. Currently the State is taxing ordinary citizens to support employers (by adding to pathetic wages or even paying them entirely), while letting the employers off. It's wrong - employers should either be made to pay better wages, or made to pay their taxes so the State can continue to support the underpaid.

  3. I was going to argue that higher wages would lead to increased food costs. But I just had a look at Tesco's financial summary: Tesco £14 300 profit per employee in 2010, and this is projected to increase this year. Why can't they pass more of this onto employees? How could we force them to do that?


  4. *Tesco *made* £14300 profit per employee.

  5. Well, it would be a start if we DIDN'T add a few grand a head to those profits by paying them to get free staff!

    Another classic approach to recession is to cap prices by law. Economies get healthier when more active - the money's in circulation. When prices of everyday expenses are held down, people buy more, money gets moving and the economy gains confidence. If the Tescos of this world took a hit, it'd be comparatively small - and there's no saying they would, anyway. They can handle a temporary shift in their business model.

    D'you think somebody should give our leaders an O-level course in economics??

  6. That's a very good article but I'm not sure of the maths - if their rent is 800 and their childcare is 300, then isn't that 1100 for those, not 2000? I don't want people picking you up on that and missing the point

  7. Thanks, should have made that clearer - £800 a month rent and £300 a WEEK childcare.

    Astounding, but that is how much childcare costs these days in UK.

  8. I do think the immigration issue is important too - It is a cop-out by politicians and employers when they say that UK birth certificated nationals do not have the same work ethics as immigrants. The result of this is that everybody's hours, pay, conditions and training deteriorate for the entire workforce when the country is inundated by a cheap and willing workforce...(and nowadays a free semi-slave workforce) it isn't the immigrants's fault, it is the politicians creating open borders policies of convenience and exploitation. The UK is the unemployment cop-out of other countries, we recycle their unemployment when they are sending their unemployment to us in the UK ... it isn't Benefits I'm talking about... it is fewer better paid jobs for everyone in the UK as a result of a flood of cheap and willing exported European unemployment into imported casual and cheap UK labour.

    The National Insurance system was designed for contributions over a lifetime, not for the pro-rata type of contributions system it has degenerated to today.

    At what point do benefits claimed vs contributions made break even? Employees who would have otherwise been contributing all their working lives, but now they are hindered from contributing to their National Insurance system 'to their full potential' due to the social engineering of politicians in cahoots with corporate world employers who desire continuous streams of cheap hourly paid labour from abroad.

    Somebody forced to a working lifetime of casualised labour cannot possibly contribute into the system in the way the system. Forcing people into a casualised existence means the system is the 'scrounger' not those being denied sustainable full-time work.

  9. there is so much here but i pay tax, council tax, na, beleiveing in all goes nito the pot for the people! so to find west mercia police force is to be privatised to an american arms company, acadamys (schools) try to find where thier 10% funding comes from, and this is the one that gets me privatization of roads, i live in a small culdesac 30k a year alone in road tax!!! begs the question how much is raised there? where is that money spent? id like a statment sent to me for that one!!


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