The government presents its far-reaching changes to the welfare system as a fiscal necessity. Introducing the Welfare Benefits Uprating Bill in the House of Commons on 8 January, the Work and Pensions Secretary, Iain Duncan Smith, declared: “We don’t take this decision lightly, but we have to get this deficit under control or this country will be bankrupt like Greece and like Spain and we’ll have huge borrowing costs.”
Yet many of the measures the government has brought in, or is proposing to bring in, fail on their own terms. The changes to child benefit, which came into effect on 7 January and transformed an entitlement available to all into a means-tested benefit, disbursed according to need, are a case in point. Experience shows that the bureaucratic costs of administering means-tested benefits frequently far outweigh the hoped-for savings.
Then there are the anomalies in the government’s scheme which led one of its natural supporters, the free-market think tank the Institute of Economic Affairs, to describe it as “pro - bably the single most incompetent change to the benefits system since the Second World War”. Under the changes, families in which one parent earns more than £50,000 will lose part of their child benefit, while those with a joint income of £90,000 in which both parents earn £45,000 will keep theirs.
Mr Duncan Smith likes to invoke the shade of Sir William Beveridge when defending his reforms, but the cuts to child benefit run counter to the animating spirit of the postwar welfare settlement, in which contributions made in work created entitlement to benefits – entitlements that were an expression of equal citizenship and status. The very universal character of welfare state institutions was seen as an important vehicle of social solidarity and cohesion.
Today, the government sees things very differently. In its view, welfare services are to be aimed only at those in direst need. The problem with this, as the social theorist Richard Titmuss once argued, is that “services for the poor will always be poor services”.