The new changes to British welfare policy

The process starts today, as listed by the FT:

1 April – Spare room subsidy ends

1 April – Council tax benefit eligibility decided by local councils

8 April – New benefit rates come into effect. Most will be increased by a below-inflation 1 per cent

8 April – Personal Independence Payment replaces Disability Living Allowance in north England

15 April – Benefit cap, limiting sums a single household can receive to about £500 [TC: that is per week], begins in four London areas before national roll-out in July

29 April – Universal Credit pilot begins in one English town

Here is a CRS-like summary of the changes (pdf).  The Guardian breaks down some of the exact numbers.  If I understand their categories correctly, total benefit spending in nominal terms is going up by 1.9%, less than the rate of price inflation.  Supporters of reform argue that welfare benefits have been going up at a higher rate than have wages.  At the first link you will see that British public opinion was about 60% in favor of higher benefits in 1991 and was about 27% in favor of higher benefits as of 2011.

There is a concomitant movement afoot to cut benefits for immigrants.

I have been reading up on the Poor Law reforms of 1834 for a forthcoming MRU course, and the number of parallels to the current situation is striking.  (By the way, here is a good D.A. Baugh article (jstor) about welfare costs leading up to those reforms.)  For instance as British workers themselves struggled, support for toughening up the Poor Laws increased considerably.  The final 1834 changes, which restricted eligibility, limited grants, consolidated categories of aid, and emphasized “putting the poor back to work,” passed Parliament by a considerable margin.  There was also at that time, and now, a variety of popular overestimates for how much the benefits were squelching work effort (see Mark Blaug on the Poor Laws for instance).

This current reform is viewed by many critics as not being very generous.  It also can be said, however, that relative to current and recently lowered expectations of future wealth for the middle class, this is probably offering a higher percentage of redistribution than was the case a few years ago or for that matter during the pre-Thatcher British welfare state.


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