Thursday, 19 June 2014

Labour's plans could destroy the welfare state, not save it

For some years now, social democrats have faced a 'crisis of the welfare state'.  This is the dilemma of how to defend and protect social security when public confidence in the system is drained.  So far, little progress has been made.  The Tories are rampant: just like the NHS is natural Labour terrain, the welfare state has become a conservative issue.

Under Ed Miliband, there have been relatively few concrete proposals aimed to address the criss of the welfare state.  The most important has been a job guarantee for long-term and young unemployed people: an offer that says 'we will provide you with work, otherwise you will lose your benefits'.

Today however marks a significant shift in Labour's welfare offer to voters.  According to the Guardian, Ed Miliband will announce two key changes in a speech today.  First, Jobseeker's Allowance (JSA) will be abolished for the 70 per cent of unemployed 18-21 year-olds who are currently low-skilled.  Instead, it will be replaced by a much more targeted (and seemingly less generous) benefit that is tied to training.  Second, more people will be subjected to means-tested JSA as eligibility for insurance-based JSA rises to five-years of National Insurance contributions from two years.

Purportedly, Labour's proposals are designed to mollify public distrust towards the welfare state and its perceived lack of fairness and reciprocity.  However, many people have long been studying the causes of increasingly hostile attitudes towards welfare in the UK.  And within these findings, two ideas have emerged that suggest Labour's proposals could have the opposite effect.

The first is that distrust of welfare is linked to the decline of the contributory principle.  After decades of increased means-testing and targeting, many people feel they get little from the state in return for their contributions.  This is the problem of getting 'nothing-for-something', not 'something-for-nothing'. Bizarrely, the spin from Labour appears to suggest that further shrinking the pool of people eligible for insurance-based JSA is a strengthening of the contributory principle.  This is a strange and misguided logic: the contributory principle would be strengthened by an expansion, not contraction, of its practical application.

The second determinant of transformed attitudes is the changing views of young people.  In a recent article, I argued that the most dramatic demographic shifts in welfare attitudes had occurred amongst the young.  Twenty years ago, young people were the most 'pro-welfare' group by age, now they are the most 'anti-welfare'.  The causes are complex and disputed - but it is highly unlikely that further restricting young people's access to out-of-work benefits will renew the bonds between Generation Y and the welfare state.

A good start for Labour would have been to expand the contributory principle, not further target it, whilst explicitly focusing on supporting young people, rather than restricting access to social security.  If the causes of such deep, attitudinal change in the UK are indeed linked to the decline of the contributory principle and the changing views of young people, today's proposals by Labour could end up having the complete opposite effect.  They could end up further destroying Britain's welfare state, not saving it.

1 comment:

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