When the Welfare State was created on the basis of the recommendations contained in the Beveridge report, the declared intention was to abolish "Want", to provide a "cradle to grave" system of income maintenance so that no-one would fall below what was deemed to be the poverty line as a result of sickness, unemployment, old age or raising a family. Since that time the system of welfare benefits has been altered and added to, new benefits have been tacked on and others cut off in accordance with changing economic conditions and the prevailing political climate. At present the Social Security system is a ramshackle maze of numerous benefits often carrying different conditions for entitlement: insurance based benefits, means-tested benefits, discretionary payments, payments as of right, universal benefits, selective benefits. It is administered by thousands of civil servants working in different government departments. themselves under pressure from the increasing numbers of claimants, cuts in their staff numbers and the complexity of applying a system which few fully understand. Many civil servants dealing with claimants in social security offices are themselves in receipt of benefits such as Family Income Supplement (FIS) because their pay is so low. At the same time there are millions of people in Britain who continue to live in a state of poverty and insecurity despite social security benefits and have to suffer the additional indignity of investigation of their lives by social security officials. Beveridge's declared intention has dearly not been fulfilled.
The present minister at the Department of Health and Social Security, Norman Fowler, has promised us in his Social Security Green Paper (Reform of Social Security: Programme for Change, HMSO) “the most substantial re-examination of the social security system since Beveridge". The government's particular concerns in conducting this review were as follows:
Rising Costs: the Social Security budget presently stands at 40 billion pounds. Since the Conservatives took office there has been a 30 per cent increase in real terms due to both higher levels of unemployment and more people becoming entitled to means-tested benefits because of low income.
Poor Targetting: the government believes that benefits are going to people who are not genuinely in need while those paid to poor people with families are too low.
Work Incentives: people claiming state benefits are thought to be deterred from seeking employment since some are as well off. or even better off, claiming benefits than they would be were they in work.
Complexity: the system is not fully understood by either claimants or staff.
Underlying these declared concerns is the belief that rising social security costs will threaten the carrot of tax cuts that the Tories have dangled before the electorate for so long and hence adversely affect their chances of re-election. They also reflect the so-called Victorian values that the government seeks to uphold; namely, the notion that individuals should provide for themselves rather than have the state do so and that families should be responsible for their dependants. This totally ignores the lessons learnt in the Victorian era. which eventually gave rise to Beveridge, namely that people cannot provide for themselves or their families in capitalist society when they are likely to become the victims of unemployment through no fault of their own, or of long term sickness, itself frequently related to poverty, bad housing and unhealthy working conditions.
The new measures proposed in the Green Paper do not represent the radical restructuring of the benefits system that was promised. The exact impact of the changes in terms of who will gain or lose in financial terms is difficult to assess since no figures for benefit levels were provided. But it can safely be assumed from this that there is no good news for the poor — if the changes were going to benefit substantial numbers of people then the figures would have been given prominence. Instead the government does not propose to give exact figures until existing benefits have received their annual uprating in line with inflation. The intention can only be to obscure the facts.
Despite this lack of hard evidence in the Green Paper two observations can be made. Firstly the proposed changes are to be introduced at "nil-cost''. This means that no extra money will be made available for the social security system as a whole, so if any benefits are to be increased they will have to be paid for by cuts in other benefits. Thus "targetting" of benefits, primarily towards poor families, will mean taking money from one group of poor workers in order to give it to another group of poor workers who are deemed to be more "deserving". The only result of this will be that many already poor workers will get even poorer. Secondly, no attempt has been made to examine the system of "fiscal welfare" whereby the very rich are subsidised by the state by means of huge tax concessions. We can be quite sure that their benefits will not be reduced in order to "target" resources on those most in need. In fact, as suggested earlier, at least part of the reason for this whole exercise is to provide the cash for increased state benefits to the better off by means of tax cuts.
It is only too easy when looking at social security to let our sense of outrage at the cynical and callous ways of governments cloud the fundamental question of why we have a system of Social Security at all.
Capital needs workers, but it doesn't need us to be employed as wage slaves all our lives. First we must be trained and socialised as children within the family and education system and then, when we slow down, capital wants us to be replaced by younger, faster workers. At other times during our working lives we may be sacked when our skills or labour power become temporarily or permanently surplus to capital's requirement. The most efficient way for the capitalist class to maintain us during those times when we are not directly producing surplus value is through a state scheme of income maintenance. The type of system provided will be determined by economic factors, the prevailing political climate and electoral considerations. What the social security system is not intended to do is to meet workers' needs in any meaningful sense. Benefits are fixed at the lowest level that political considerations will permit forcing claimants into a state of real poverty. To be forced to make a choice between paying an electricity bill and buying your child a new pair of shoes is not meeting needs. To force the elderly to choose between turning on the heating and eating a good meal is not meeting needs. To force the young unemployed to return to family homes by stopping housing benefits is not meeting people’s needs. Life on social security benefits is insecure, deprived in both material and social terms and subject to humiliating bureaucratic interference.
The Fowler review will not change these features of the system at all. It is a particularly blatant example of manipulation of social policy to meet short term economic and political ends, with callous disregard for the hardships caused to the poorest workers. Workers don't need a review of social security. What we do need is a review of the system of society which creates the need for such benefits in the first place. That system of society capitalism cannot meet the needs of the working class, whether they are in work or out of work, sick or healthy, old or young; it cannot meet our needs because that is not its intention. Its purpose is profit, and production, distribution and all the supporting services that maintain it are directed towards that end. In that total process workers are just more cogs in the wheel that must be maintained in reasonable working order at minimum cost, forced to work or not as and when capital dictates. But unlike machines, workers have the capacity to reproduce themselves, thus providing a never-ending supply of new workers to feed capital. Workers also have the unique ability of creating more wealth than it costs to produce their labour power. And it is part of this surplus value, created by workers ourselves, that is used to provide us with state benefits when capital does not pay us a wage or salary.
Any number of reviews of social security, or simplifications or changes in benefit entitlement cannot eradicate this crucial feature of capitalist society. Workers will continue to live in poverty and watch their children grow up deprived of the things that make life worthwhile until we, the working class, organise together not to change the benefit system but the whole basis of society so that the sole aim of production will be to meet people's needs. But above all socialism will enable everyone to participate democratically in running society, in making decisions that affect us and our communities. No longer will we be impoverished and rendered impotent by the activities of bureaucrats and politicians.
Janie Percy-Smith
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