John Humphrys asks: are the new reforms to state benefits penalising the poor or are they creating a fairer system and making work pay?
This month, as radical changes to the welfare system come into effect, the political row over state benefits has heated up. Labour and the churches have accused the government of penalising the poor. The Chancellor, George Osborne, says the changes are not just about saving money but about creating a fairer system and making work pay. At root there is a conflict of moralities. Who’s right?
Since coming to power nearly three years ago, the coalition government has been intent on far-reaching reform of the benefit system. The social security budget is by far the largest single item of government expenditure and so, at a time when savings have to be found in order to reduce the deficit, the welfare budget was bound to be a prime target. But most of this budget goes on state pensions, which can’t really be touched except in the long run. So it is the money spent on benefits to people before retirement, both in and out of work, that has been in the government’s sights.
Until this month the value of most of these benefits has been upgraded in line with inflation. But for the next few years they will rise by only 1% each year. Since inflation is running (and is likely to continue to run) at a higher rate, this limitation means the real value of the benefits will fall. Furthermore, the government has, for the first time, placed a cap on how much any individual household can receive in benefits, irrespective of how big that household is. It has been set at £500 a week, or £26,000 a year.
On top of all that, the government has transferred to local authorities responsibility for deciding who should and should not be eligible for council tax benefit and has introduced what has come to be known as a ‘bedroom tax’. The government says it’s nothing of the sort … merely the removal of a subsidy to those on welfare with a spare bedroom in their homes. They claim this will encourage people in social housing to move to homes more suited to their needs, thus making more efficient use of these scarce homes.
The Chancellor also claims that, taken in the broader context of other changes he has made to the tax system, nine out of ten recipients of these benefits will be better off after the changes. But Labour has accused him of being selective in his use of statistics and says many hard-working families will be badly hit. Their research shows that only about 5% of those likely to be affected by the ‘bedroom tax’ will be able to avoid it by moving home.
And the churches have waded into the row too. They’ve attacked the overall effect of the changes. The new Archbishop of Canterbury, Justin Welby, said last month that the cuts in benefits would exacerbate child poverty. And a group of church leaders from the Baptist, Methodist and United Reform churches and from the Church of Scotland attacked those who sought to justify the changes on the grounds that they targeted welfare scroungers for engaging in a ‘systematic misrepresentation of the poorest in society’.
But the Work and Pensions Secretary, Iain Duncan Smith, argues that for those who genuinely need them there are still plenty of welfare benefits available. When he was challenged by one of my interviewees on Today as to whether he could live on £53 a week, he said he could “if I had to”. An internet campaign was immediately launched challenging him to prove it.
The Chancellor, however, seems to believe that the government needs to be neither defensive nor apologetic about the changes. Wearing his other hat as the Conservative Party’s chief electoral strategist, he is convinced the public is on the Tories’ side over welfare reform. This is not because of the specifics of the figures, but because of something much deeper and less tangible – the notion of fairness. Disagreement over what is or is not fair lies at the heart of the politics of welfare.
For those on the left the most important principle of welfare is a very simple one: it should be provided for those who need it. ‘From each according to his ability to pay; to each according to his need’ is the basic maxim. And to people who believe in it, it is especially true in cases where children are involved because they are particularly vulnerable.
But there is another notion of what “fairness” ought to mean. It relates not to what people need but to what they deserve. Looking at the issue of welfare in this way produces a very different picture. Many of those who claim to need benefits do not seem (to those who hold this view) to deserve them. They are scroungers exploiting the good nature of those prepared to pay to subsidise them.
It was this view to which the Chancellor appealed in a speech on Tuesday. He said: “For too long we’ve had a system where people who did the right thing – who get up in the morning and work hard – felt penalised for it, while people who did the wrong thing got rewarded for it. That’s wrong.” He said the reforms were “about making sure that we use every penny we can to back hard-working people who want to get on in life. This month we will make work pay.”
The Chancellor’s opponents say that might be all very well if there was work for people to go to, but his stewardship of the economy means there is not. His supporters counter by pointing out not only that employment has grown considerably under his watch but, more significantly, around 75% of all jobs created in the last ten years have been taken up by immigrants. This, they suggest, means there really is something wrong with the welfare system.
Iain Duncan Smith claims that this reveals another moral defence of the changes. The system, far from helping those on benefits, has actually blighted many of their lives by making them dependant on state hand-outs and, in effect, sapping any incentive they might have had to take control of their own lives and improve their fortunes. This erosion of personal responsibility has been handed down the generations in families where neither grandparents, parents nor children have ever worked. Taking away the wherewithal for such inherited inertia is a morally good thing, he argues.
But few systems can accurately distinguish between what used to be called the deserving and undeserving poor. Attempts to end harmful welfare dependency by making benefits less generous may succeed in forcing those who could work to do so but are bound, in the process, to hurt others, including children, who are not idle scroungers but genuinely in need of help.
It’s the conflict between these two views that make the politics of welfare so hot.
What’s your view?
- In general do you support or oppose the welfare changes the government is introducing?
- What do you make of the specific changes to the uprating of benefits, the cap on total benefits and the ‘bedroom tax’?
- Do you think the Archbishop of Canterbury is right to warn that the changes will exacerbate child poverty?
- Which model of fairness do you think ought to inform our welfare system: providing benefits to those who are needy or to those who are deserving?
- Do you think the system up to now has allowed too many people to scrounge off the state, or do you agree with the churches that this misrepresents the poorest in society?
- And could you live on £53 a week?
