Whose Economy: whose welfare? - John Lee

Whose Economy: WhoseWelfare? Dr. John Lee

Welfare Reform A major programme of welfare reform beginning in 1997 Active Labour Market Policy Raise employment levels to 80% of W.A.P. Affecting all claimants groups, but… Still some 5 million people on out of work benefits Reform agenda continues apace with the ‘Work Programme’

Claimants of main out-of-work benefits Incapacity benefits Lone parents on income support JSA3,500,0003,000,0002,500,0002,000,0001,500,0001,000,000 500,000 0 1979 1982 1985 1988 1991 1994 1997 2000 2003 2006 2009 3

A Punitive Welfare Regime In essence the welfare regime in the UK has always been based on a version of the Poor law:  ‘Less Eligibility’ – welfare has to as unattractive as possible  ‘Deserving and undeserving poor’ - widows/the able bodied unemployed Some evidence to suggest the welfare regime adversely affects health and wellbeing(1) Increasingly punitive:  Reassessment of IB  Lone parents lose Income Support when children reach age 7  Mandatory Work Activity - 3 year loss of benefits  Abolition of DLA and mandatory testing for PIP

Incapacity Benefits A massive programme to reassess incapacity benefits claimants; Pilots a success (pilots always are) Approximately 33% found fit for work and ‘invited’ to migrate to JSA Approximately 33% transferred to the work activity group on ESA

Volunteering Benefit regulations have been altered to encourage volunteering (e.g. 48 Hour Rule; 16 Hour rule) Volunteering highly visible in key policy documents Guidance emphasizes that volunteering does not affect benefit entitlement Volunteering a ‘work like activity’ for ESA claimants Volunteering Options Programme for JSA claimants Get Britain Working – JC+ to actively signpost

A cost cutting exercise? ‘UK Benefit bill = £190 billion; but Most of this is accounted for by pension payments and payments to children Spending on income replacement benefits and DLA account for only 13% of the total bill for social security (2) Falling value of benefits - JSA in real terms value is now worth the same as in 1997; Universal credit will cost 3billion to administer.

JSA 64.30pw JSA-C limited to 26 weeks A fifth of the actual, average expenditure for a single adult Half of the actual, average expenditure of single adults in the poorest households Half of the Government’s (income) poverty line for single adults Two-fifths of what is need to reach a minimum standard of living (3).

Whose Welfare? Welfare Reform programmes have had little impact (e.g. Pathways to Work; NDDP) Evidence to suggest that it is increased demand in the labour market which really makes a difference (4) Significant involvement of the private sector Work Programme contractors will be paid from benefit savings Increasing levels of in-work poverty and concern about the real effectiveness of work as a route out of poverty.

So What’s the Point? Reinforce the principle of Less Eligibility? o Mandatory Work Activity – and loss of benefit o Reduced value of benefits o Increased conditionality o The end of unemployment benefit?• Remove the category of the ‘Deserving Poor’?• Abolition of DLA; replaced with mandatory testing for PIP• Lone parents lose benefits when children reach age 7.

References:1. Nordenmark, M, Strandh, M and Layte, R (2006) The impact of unemployment benefit systems on the mental well-being of the unemployed in Sweden, Ireland and Great Britain. European Societies, Vol.8, No.1.2. Kenway, P et al (2010) Working-age ‘welfare’: who gets it, why, and what it costs. York: JRF.3. Kenway, P (2009) should adult unemployment benefit now be raised. York: JRF.4. Webster, D et al (2010) Falling incapacity benefit claims in a former industrial city: policy impacts or labour market improvements? Policy Studies, Vol.31, No.32

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Whose Economy: whose welfare? - John Lee

by Oxfam GB on Oct 26, 2011

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