Lessons From the Growth of Benefits

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The British experience provides lessons for all countries that are embarking on the expansion of social welfare schemes.

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When the Blair Brown Regime was booted out by voters in 2010, any incoming Government faced some very serious risks and an economy that was not just broken but a broken economy that ended in a scorched earth campaign of deliberate harm once the Blair Brown Regime realized its days were numbered.

The toxic mess that was left for someone else to clear up was beyond the capabilities of any full term administration. Some dramatic progress was possible during the first five years after the excesses of the Blair Brown Regime, but more than twelve years would be required to put the British economy back into the good order that was achieved before the 1997 election that saw the the Blair Brown Regime sweep to power with a massive majority on fewer votes than those achieved by John Major when he retained power for the Conservatives following the resignation of Margaret Thatcher. To his credit, John Major had seen the rebuilding of the economy after the mistake of trying to prepare for Euro Zone Membership, even if his administration was generally disappointing.

Gordon Brown had hoped that if he could not retain power, he could cause so much damage to the economy that voters would beg for his return at the first opportunity. Even after the voters had told him in no uncertain terms to go, he desperately tried to cling to power, eventually leaving with bad grace after the Conservatives and LibDems formed a Coalition Government.

With the Coalition Government at mid term, it can be seen that Cameron and the LibCon component of the Conservatives were only too happy to be blackmailed by the LibDems into failing to turn the economy round as it should have been. The result is that many great opportunities were wasted and the greatest economic achievement was to slow the pace of growth in public spending. Most of the promises made in 2010 have not been delivered and that includes Coalition promises as well as Conservative promises that might be excused as impractical without a strong Conservative Government. The one area where opportunities have been seized is in attempting to bring the ballooning social welfare expenses under control. Even here the potential victory was watered down by Cameron and his LibDem comrades under the poisonous and hypocritical Clegg.

Therefore, the lessons for other countries are most frequently of how not to do something than how to do it.

The project started well as Ian Duncan Smith started to put into action the plans based on his extensive research into social welfare defects and the development of a sound understanding of what desperately needed to be done.

Recently, politicians have tried to demonize those drawing social welfare in an attempt to divert attention from the failure to deliver on economic recovery. This has been aided by a Labour Party that is still in denial and led by a collection of Blair Brown Regime retreads who were part of the processes that led to such a comprehensive trashing of the British economy.

As voters despair of the three old failed Parties ever being able to develop a suite of sound policies, and actually deliver on promises, they are increasingly turning to Ukip and suggesting that the next General Election will see a major political revolution with voters regaining their civil liberties and seeing a Ukip Government that may introduce all of the policies that were needed in 2010, updated for the situation in 2015. That further confuses the social welfare reforms because increasing Ukip support highlights failures of the Coalition Government in what is likely to prove to be, by 2015, five wasted years.

It is fair to say that a lack of firm support for Duncan Smith’s plans, by David Cameron, has resulted in lost opportunities as the plans were watered down. However, the results of the changes in social welfare payments demonstrate that Duncan Smith was on the right track and deserved real support from his colleagues in Government and an abject apology from Milliband and his cronies in the Labour Party.

When money is short, every Government has to focus on reducing spending across departments and to concentrate special efforts on any department that looks like a spending runaway.

Social welfare spending was an obvious target and was already unsustainable. There had also been a stream of examples of wild abuses of the system.

The disability benefit system has demonstrated just how great the need and opportunity for reform really is.

Of 1.4 million claimants who agreed to submit to medical examination, more than half were shown to be fit to return to work. Some of these may have suffered disability in recovering injuries or sickness and have only just returned to fitness, but many were clearly never unable to work due to sickness. To move on to blame the claimants is tempting but generally unfair, although those really responsible should be held to account. Even more graphic was the example provided by almost one million claimants who decided to come off benefits before a medical examination that would have found them fit to work and in some cases would have exposed deliberate fraud. The end result is that almost three quarters of those on disability benefits should not have been receiving public funds for disability support.

Dramatic though these examples are, social welfare funding will not be reducing, only expanding at a much slower rate. Mainly that is a result of existing rules requiring payments to those receiving social welfare should increase, there will be a small number of major frauds, often involving officials, and many of those who failed medicals, to continue receiving disability benefit, will simply move across to the unemployment listing. That demonstrates that politicians must understand and accept the situation as it exists and then develop policies to make social benefits affordable, appropriate and also adequate to the needs of those who should receive benefits or pensions.

The Labour Party is attempting to further destroy reconstruction by branding one benefit reduction as a “bedroom tax” in the same way that an earlier Labour Opposition branded a very sensible reform in Local Government Tax as a “Poll Tax”, condemning pensioners to poverty as they are ruthlessly taxed on property. The benefits changes have not been well-thought out in respect of accomodation. There is no reason why the taxpayer should have to pay housing benefits for a property that is provided under social housing that is larger than necessary, but it is equally unfair that someone who has been allocated social housing and is now receiving benefits payments, including housing benefit, should have the benefits reduced because the allocated housing includes a spare bedroom. Where the social housing is larger than required, the provider should be able to offer alternative accomodation that is adequate to the need. There is also no justification in hitting a couple with reduced benefits when one is disabled, requiring each partner to have their own bedroom. There are situations where one partner is seriously disabled and the other partner leaves full time employment to become a full-time carer. Currently, the two people might both be receiving benefits and requiring two seperate bedrooms, but the cost of providing residential care or a number of live-in nurses would cost the State considerably more and provide a lower quality of life for the disabled person and his/her partner. The principle of reducing benefits on housing larger than required might be justified in some cases, but there has to be a sense of proportion and a transitional process so that benefits recipients are not exposed to anxiety and unfairness. How many people are harshly unfairly affected is unknown, having more to do with political points scoring than genuine concern for welfare. It may also be a case of a necessary reform, being needed to remove an area of welfare abuse, being applied by incompetent and uncaring bureaucrats. The danger in attempting to influence the size of dwelling by taxation or by benefits reductions is that most people will not have moved into a large building to claim more benefits. The reality is that most people move into a home to meet their current needs at the time they move, and then their needs are changed by circumstances beyond their control. However, they have already built friendships in the area and developed a strong feeing for a home with so many good memories and attractions, that they do not want to move somewhere else. What makes the attempts by politicians to impose lifestyle regulations obscene is that most of them, across the three old failed Parties, own many properties and fleece the taxpayer to underwrite the costs of these mansions and grand apartments. One very recent example is a former Blair Brown Regime Minister, David Milliband, resigning from Parliament to spend more time with his wealth that was built up from his time serving the Blair Brown Regime. Perhaps the current exercise on cutting housing benefit should be relaxed until MPs have had the chance to vote for a reduction of their own exceptionally generous benefits packages and to introduce a strong and independent auditor to control their own claims.

What is now clear is that the Blair Brown Regime manipulated social benefits systems for Party political advantage. In so doing the Regime also managed to treat those who should receive benefits in a most unfair manner that is unforgivable.

The Blair Brown belief was that if they could move a majority of voters on to the public payroll as public sector workers and benefits recipients, they would depend for their existence on the Labour Party and effectively create a single Party State which could emulate the Soviet State under Stalin. Of course that cynical approach has absolutely no interest in the well being of citizens and everything to creating a permanent political elite who enjoy a lifestyle so far above that of the citizens, it is obscene, making the worst excesses of capitalism look modest and frugal.

The basic lesson is that the majority of those drawing benefits need what they get and more besides. Their benefits are adversely affected because so many who do not need benefits continue to receive them. Of those who should be helped out of the benefits trap, most are only too keen to escape and return to work, but they do need support to return to full employment. There are also those who are victims of deliberate political policies and require special consideration because so much, including personal attitudes, has to be turned around. A failure to do this fails all of those who work hard and save for the future and for emergencies.

What Duncan Smith has not been helped to achieve, is a complete restructuring of the benefits industry and a fair program of turning around those who need special help. That is partly because the Blair Brown Regime so seriously damaged the economy, restricting options, and partly because the three old failed Parties are so close together as an unaccountable political elite that needs to experience its own revolution and restructuring.

In the Victorian period, the Poor Law Commissioners and Poor Law Guardians were tasked with providing sufficient support to protect the most vulnerable from starvation. As a result, the Work House was intended to provide continuing work for the vulnerable until they could find new jobs outside the Work House. While they were requiring this support, they were fed and clothed with the Work House keeping them for homelessness. It was not a perfect system and when viewed from modern eyes, it looks brutal and unpleasant. That is unfair because it was devised in a society that was very different. The best run Work Houses and the best Poor Law Guardians provided essential support and care that helped their dependents back onto a sustainable future in what was at the time a generous environment. The best principles were therefore humane. The intention was to ensure that no one starved and all who needed support could rebuild their lives. That this was often delivered was demonstrated by the fact that many Poor Law beneficiaries were as well fed accommodated and clothed as those in full time work at the lower end of the pay scale.

That contrasts with the Blair Brown Regime political abuse of the benefits system. Amongst the multitude of examples of abuse was the encouragement of young women to become pregnant to receive priority for an apartment, becoming single mothers living on benefits. In some cases the women had not even left full time education when they became pregnant. This condemned them to a marginal live style and frequently to a life of crime and drug dependency. Another of the many examples is the case where someone on unemployment benefits was persuaded to transfer onto the disability benefits system. That was attractive to the claimant in many cases because the rate of benefit was higher on the disability system and there was no longer any pressure to return to full time employment. Very quickly, millions became institutionalized and were forced into a life of despair. For the politicians, it massaged the unemployment figures and provided work for the millions of people who were encouraged to migrate to Britain, by keeping Britons out of the labour market. This immigration program was part of the Blair Brown Regime belief that immigrants were yet more captive votes. For those who had migrated to Britain many years ago, and were already integrated into society, this process of open door immigration was as unfair as it was for those who had lived in Britain for many generations. It had the additional impact of making it very difficult for those wanting to escape the benefits culture because the immigrants mopped up jobs that they would otherwise have been able to take and it also meant that many immigrants would immediately or rapidly move onto benefits dependency.

Where the efforts to correct a seriously damaged system are difficult is that change is unavoidable, but presents a series of challenges if the process is to be helpful during the transition. Ian Duncan Smith came up with some well thought solutions but very few of these will be fully implemented because he has been so badly let down by the Coalition Government and his LibDem “allies” have often sided with the Labour Party to frustrate needed change. That has often meant that vital changes are not adequately supported in the transition period which is unfair to the current benefits claimants. It also means that the critical re-assessment of benefits has not taken place to create an environment where the vulnerable are protected but that society encourages work.

The first key step is to decided in an open debate what the social welfare system is there to achieve. A similar program is also urgently needed to turn around the hugely expensive and failing NHS health care system.

When someone is unable to work, they should receive every assistance to obtain the medical care that will make their life more comfortable and hopefully to restore it sufficiently that they can return to work. Clearly, Britain does not have this critical support environment to adequately support the sick. During sickness, the affected should not have to worry about food, accommodation, or any other essential aspects of existence. The present system provides something but many find that it is not adequate, unless they have the wealth to avoid the benefits system in part or completely. Those who have prudently built up investments to help them through emergencies find that the State all too frequently attempts to force them to spend the money until they are penniless. That increases anxieties, makes it much more difficult to return to work later, and is unfair because the rainy days nest egg was built to cover several other needs. The result is that many prudent people are forced into dependency on the benefits system and are trapped there. Similarly, those who find themselves out of work do not receive the early help to return to work. The reality is that unemployment benefits do not cover all of the costs experienced by those trying to return to work. Job hunting costs money. When times are hard, thousands apply for a handful of jobs. In very bad times, a person genuinely wanting to return to work, who also has many skills and would be an ideal employee, many have to apply for literally thousands of advertised vacancies before finding employment. That can be a soul destroying experience and one that institutionalizes many potentially productive workers, trapping them in unemployment.

The major problem is that Government funded social welfare programs tend to expand way beyond their initial objectives and then spread the available funds very thinly so that only the accomplished benefits exploiter can gain adequate funds. The result is that only crooks are helped, whilst the millions of decent people who need support fail to receive what they need to survive and find work again. So many problems are very obvious but the solutions are not. This is no excuse for not makig a genuine effort to deal with a broken system and Duncan Smith deserves great credit for hard work and intelligence in attempting to find solution. What a pity more in Party leadership and Parliament have yet to emulate his efforts!!!

 

Editor.

The strongest lesson from the British experience is to avoid going down the road that Britain has followed. Attempting to turn the situation around is very difficult and likely to be painful for many. The end result will be more than worth it but the early pain will encourage those who hope to retain the current mess and really don’t care for those on benefit who need and deserve the support of the community.

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