Can we reform Welfare Reform?

The Welfare Reform package by the UK coalition government is estimated to reduce the income of the poorest people in society by £18 billion. With the income guarantees provided to elderly people, these cuts will fall hardest on people of working age and their families. These cuts are through a combination of changes: the new ‘bedroom tax’, the changes to Council Tax benefit, the changes to Disability Living Allowance, and the changes to the Social Fund. Driven by a policy of cutting public spending, all these changes take money from those least able to make a sacrifice. Looking further ahead, there will be the Universal Credit changes which aim to combine all benefits and taxes in one monthly payment, but administrative chaos is widely predicted with poor people bearing the real cost of living as best they can for days or weeks at a time with no money. Rights to Legal Aid advice and representation are also being withdrawn. Polly Toynbee in The Guardian summarises these changes well.

Therefore, what might be the best progressive and humanitarian responses to this rising crisis?

Looking back, the best response a few years ago was usually to run a welfare rights and take-up campaign. Many people would gain because they had not been receiving their full entitlement, and an active advice sector could co-ordinate appeals so that the envelope of eligibility was increased. This strategy still has merit, but the forces against it now are much stronger and harsher than before.

More recently, there was a shift in strategy away from take-up towards making work pay. The progressive argument was that people were living in families where unemployment was becoming inter-generational and that instead it was better for people’s health as well as financially for as many people as possible to be working instead. Through measures such as the new minimum wage and working tax credits there was a concerted economic effort to end the poverty trap of benefits and show people that ‘work pays’.

Currently we seem to be in a state of flux, at a point of change. There are still some progressive discussions about reducing dependency and increasing access to jobs rather than to benefits. However, the combination of rising unemployment, reduced levels of tax credits, real-terms reductions in the minimum wage and a casualisation of the labour market have profoundly changed the economic realities of many poor people’s lives.

Therefore dependency might just make a lot of sense at the moment to poor people, if not also to public authorities. It has already been said that 2012 was the year of the food bank. There is also a wider context of growing income inequality in the UK, with increases in higher pay racing ahead of far smaller movements in low pay.

Perhaps the most recent response here is still workable, namely the living wage campaign. This puts pressure on larger employers in particular to pay a decent wage rather than a minimum wage, with perhaps its strongest impact in London. However for a living wage strategy to work it requires more jobs.

Clearly one response to the rising crisis of welfare reform is to campaign for the cuts to be reversed, and though it would have been far better for the cuts never to have been implemented, there are still campaign opportunities which civil society and sections of Parliament can bring to bear on the government to overturn the changes as quickly as possible.

But beyond these necessary reverses, we need to reform the Welfare Reform strategies as well. Work can provide people with meaning, dignity, respect and health. But increasingly in our current ‘flexible’ economy many people’s experience of work, such as long hours, low pay, insecurity and low level harassment is anything but dignified or enabling, and creating more jobs and at a living wage is only part of the solution. We cannot reform welfare without reforming employment.

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