Act in the Court: Dipti in the dock (2002)

From the March 2002 issue of the Socialist Standard

Standing there, just able to see above the top rail of the dock, Dipti did not look like a threat to the very fabric of civilised society. For one thing people who threaten civilisation are supposed to be reckless, defiant, composed. But Dipti was trembling and had desperate tears in her voice. And while she stood there civilisation, unthreatened, carried on outside the court. The list of cases for that day noted that she was charged with False Representation – between this date and that date, against the Benefits Agency, resulting in her being “overpaid” well over ten thousand pounds. In plain words – Daily Mail-speak – she was a Social Security fraudster, a benefits scrounger, a leech sucking the blood of the welfare state – a threat to civilised society.

Cases like this are prosecuted separately from the run-of-the-mill criminal charges, which are handled by the Crown Prosecution Service. Instead the Benefits Agency have their own lawyer to put to the court the details of the offences. The facts were, said the lawyer, that Dipti had applied for Income Support, stating that she had no other income. She had been sent a book of vouchers to cash each fortnight and on each of them she had signified that there had been no changes in her circumstances such as to affect her entitlement to benefit. But for some months she had been working as well. Nobody in court pointed out that the word “working” was hardly the right way to describe her experiences: “low paid, stressful drudgery” would have been more appropriate.

It was just another episode (although this was something the lawyer did not say) in a miserable life. Her parents were too poor to care for her properly and sent her to live with an aunt in England, in the hope that she would do better in another country. And so it turned out for a while, until both the parents died and her aunt, who she regarded as her mother, was killed by a hit-and-run driver. Alone and vulnerable, she was married when she was 18 and had three children. It was not the happiest of unions as her husband was an alcoholic who never had any silly ideas about supporting his children financially, which left Dipti to struggle on as best she could, doing whatever odd job was available, scraping a living for her family. It came as a relief when the husband left the home for good and when he had been gone long enough Dipti was able to get a divorce.

It would have been surprising if the children had come through this emotionally intact. And they didn’t: they behaved as might be expected of children whose short lives had been distorted by insecurity, violence and the stresses to be found in the deeper levels of poverty. They were, all three of them, incapable of coping with what is called – by courts, government agencies, the media – “normal” life. A psychiatrist, trained to brace people’s expectations of society to accept and tolerate the unacceptable and intolerable, would have interviewed each of them and written learned notes to the effect that they were “disturbed”. It is not their job, or within the scope of their training, to assess how “disturbed” is capitalist society; that might bring them to the conclusion that the people who react against the inhuman pressures of that society are sometimes healthier emotionally than those who are at ease with it.

In any case Dipti was too busy to bother about psychiatrists and their theories. She had found a job which suited her, allowing her to work irregular hours which could be fitted around the needs of her children – who were in their teens by then. It did not need any qualifications – she had problems with reading and writing – and provided periodical training. There were however two main snags. One was that it was demanding work and the other was that the wages were very low. It was agency work, as a care assistant, which meant Dipti had to visit people to do basic things which they could not do for themselves. From day to day she did not know where or when she would be asked to work; the agency would telephone her with the jobs on hand for that day. In fact she did get a lot of offers of work from the agency, because she had some huge debts and so was always eager to earn the extra money and she was always reliable and helpful.

There was a third snag. She did not tell the Benefits Agency about her job but carried on claiming Income Support, signing those vouchers to say nothing had changed for her. If she was ever bothered about this she told herself that after all each wage slip showed a reduction for Income Tax and in any case her husband had never paid anything towards the children’s’ upkeep. Did this not entitle her to some money from the state? But agency work is a field well-patrolled by the fraud seekers of the Benefits Agency and eventually they uncovered what Dipti had been up to. When they approached her she did not try to hide anything, although she was shocked when they told her how much she had been illegally paid. Her shock was not lessened when they also told her – a bit late in the day, some may think – that her wages had been low enough to qualify her for Family Credit, which over the period would have been worth some thousands of pounds – about a quarter of the amount she had overclaimed.

The lawyers briefed by the Benefits Agency do not as a rule prosecute with the same zeal as the Crown Prosecution Service. In cases of benefits fraud the facts are usually put to the court in the round, including some details which may make things easier for the person in the dock. So in that sense Dipti was not treated as harshly as she might have been – certainly not as she had feared. But of course the chairman of the bench had heard it all before, many times and he had come to the conclusion that the country was being overrun – and overturned – by people who were getting something for nothing – claiming state benefit which they were not legally entitled to. There is, he informed Dipti, too much of this going on. He had probably familiarised himself with the official estimate that social security fraud costs between £2bn and £4bn a year – and was too shocked to notice that the evidence to support those figures was so weak. It had got to stop. He stopped short of saying that he could do this all by himself. Instead he told Dipti she could well go to prison for this – all options were open. She would have to come back in a few weeks, after further enquiries had been made, when sentence would be passed. Meanwhile she could leave the court and civilisation, with its minority class getting a great deal for nothing through their exploitation of people like Dipti, could go on. Outside the court she grabbed her mobile phone and got on to the agency, asking what work they had for her for what was left of that day.

Ivan

So, this is Social Security (1966)

From the November 1966 issue of the Socialist Standard

"During the last 50 years a comprehensive scheme of national insurance has been gradually developed to become the central feature of our system of social security.” These were the words of the then Minister of Pensions and National Insurance Richard Wood, in a forward to a government booklet: Everybody’s Guide To National Insurance, May, 1964. If this statement does anything at all, it underlines capitalism’s continuing, indeed developing, need for all sorts of compulsory insurance provisions for its working population.

We have come a long way since the days of Lloyd George and his five shilling pension proposals, and the very limited dole and "panel” medicine of the inter-war years. To even these comparatively modest measures, there were always the objectors who thought “the country could not afford it,” but it was Lloyd George himself who shoved his opponents contemptuously aside with the observation that paying a pension was cheaper than maintaining old people in work-houses. And this has been the sort of criterion which has guided the reformers ever since; despite the professed humanitarianism of the Labour Party, their spokesman Jim Griffiths was under no illusion about the aims of national insurance when he commended his sweeping post-war proposals to the Commons on February 6, 1946:

The loss to the Nation caused by preventive illness alone is appalling, for it has been estimated at £300 millions a year, equal to 3/5ths of the cost of the scheme in its initial year. To those who fear we cannot afford this scheme, I would advise them to ask themselves if we can afford to go on without it. 

Under this National Insurance Bill, a wide range of “benefits” was enacted based to a large extent on the old Beveridge proposals, and estimated to cost some £452 millions in 1949 and £496 millions in 1955. Contributions were to range from 2/2d. to 4/7d. a week from workers, and their employers were to make weekly contributions ranging from l/9d. to 3/10d. per employee. There was also to be a grant from the Exchequer, and all of this money was to be pooled in the National Insurance Fund, to which would be charged the costs of benefits and administration.

This arrangement has remained largely unaltered over the years, but it is nonsense to suggest, as some Labourites and others were doing then, that the scheme would abolish poverty. Prime Minister Attlee claimed in a Commons speech (February 7, 1946) that “the Bill would help to maintain the high standard of purchasing power among the masses of the people.” But just take a look at some of the benefit rates then, and see if you agree with him: — 

Unemployment or sickness               26/-per week (£2 married couple)

Pension  . . .   . . .                             26/-per week (£2 married couple)

100 per cent Disability Pay                45/-per week 

Nat. Assistance (ordinary) . . .            50/-per week

    for man and wife (begun 1948)      65/- per week

Incidentally, an interesting and pertinent comment is made on the scheme by M. Penelope Hall in her book The Social Services of Modern England. She says:

One drastic modification in the Beveridge Plan was made at the start. Benefits have never been paid at subsistence level. Beveridge regarded this modification to his scheme as disastrous. 

In the 20 years since 1946, government cost estimates have been sadly put out by continuously rising prices and increases in the cost of living, so that various amending Acts have had to be passed, stepping up the benefits and the contribution rates. By 1959, for example, unemployment, sickness and pension rates all stood at 50/- per week single, while National Assistance was at 76/- (normal) and 96/- (special) for a man and wife. This was the year, you may recall, that the Tories were pointing with pride to their achievements in this field, ignoring such uncomfortable facts as 1¾ million people having to apply for National Assistance—about 1.4 millions of them old age pensioners.

But even the Conservatives, jubilant at their 1959 election victory, could not pretend that provisions were adequate, even by the miserable standards that capitalist politicians set, and not long after that their graduated pensions scheme was introduced, which meant larger contributions from those earning over £9 a week, to secure proportional payment in addition to a flat-rate pension. Under such an arrangement, you would get an extra sixpence a week added to your flat-rate pension for every £7 10s. paid in, and when you consider the piffling extent of these changes, you might wonder what all the song and dance was about. Certainly there was nothing from the workers’ point of view, although from the Government’s angle the new scheme gave the pension system some flexibility, and so no doubt was intended to keep down the extra cost.

The whole question of National Insurance was tossed about by the main parties at the 1964 election, and it was becoming apparent anyway that an overhaul was due in the system of payments and contributions. For example, while there was not the heavy and persistent unemployment of the twenties and thirties, there was the question of “labour mobility” and the tiding over of unemployed workers when retraining for new jobs, following the decline of some of the older industries. So the Labour Government’s measures now include compulsory compensation payments to any worker made redundant after a minimum of two years at the same job.

In the government’s social security arrangements, it is interesting that they have retained essentially unchanged the graduated pension scheme of which they had been so scornful when the Tories introduced it. In addition, there is the “Earnings-Related Short-Term Benefits Scheme” which just means that there will be a flat-rate sickness and unemployment benefit of £4 a week minimum, plus further payments, depending on your average weekly earnings between £9 and £30 a week. Here again we see the pressure of present-day conditions in the government’s attempts to offload at least some of the burden of the rising cost of benefits from the central Exchequer. Quite clearly also, the 1946 scales and payment methods no longer suffice to keep workers ticking over in sickness or between jobs, and once more the modern emphasis is on “flexibility”. It could be that this is something we shall see more of in the future, what with the growth of new industries and the decline of the old, to say nothing of plain old-fashioned unemployment because of trade crises.

And what other changes have there been recently? Oh yes, the old Ministry of Pensions and Njational Insurance has been replaced by the brand new “Ministry of Social Security” (surely a contradiction in terms) with responsibility for all the schemes which were formerly administered separately, such as National Assistance. These particular payments will be known as “supplementary benefits” and are a fitting reminder of the way in which reformers' plans can misfire. In 1953, Lord Beveridge admitted that he and the experts had originally expected National Assistance payments to be on a small scale only and to gradually diminish. But, in fact, the very opposite has' happened, and the government has resigned itself to the fact by allowing for increased rates of benefit when the new arrangements start in the autumn.

What all these measures add up to is merely the organisation of 1966 poverty by 1966 methods, and the usual attempts to maintain the workforce at the appropriate standards of health and efficiency to keep capitalism’s production and profits going. It has been the irritating habit of Labourites to claim that these Acts bring dignity to workers’ lives, but their very existence is an indication of the essential indignity of working class life. And despite the increasing intricacy of state insurance and widening of its scope, there are many who stay stubbornly poor even by “Supplementary Benefits” standards. Like the 15,000 families admitted by Assistance Board Chairman Lord Runcorn to be “living on assistance at the moment, at an income well below their needs, because allowances are based on the best estimate that can be made of a man’s future earnings.” Or like “those whose take-home pay is less than they need by assistance standards, although in full employment.”

Eddie Critchfield

Poverty — fiddling the books (1986)

From the August 1986 issue of the Socialist Standard

Creative accountancy is something which, it is claimed (by accountants, of course) can rescue companies from bankruptcy. It has nothing to do with production (so no need to worry about strikes, shortage of components and the like) and nothing to do with sales (so no need to worry about Japanese competition). It is an imaginative, elegant restructuring of the books so that what were once shown as losses can now be shown as profits. This can sometimes be done through hiding real costs in the accounts, for example:

. . . the (first) nuclear programme was politically determined and exempted from CEGB rate of return tests. Without that exemption no nuclear power stations would have been ordered between 1958 and 1964. (Atomic Crossroads. John Valentine).

Another example came during the coal strike of 1984/5. when it was argued that a change in the accounting method would move many of the pits which the NCB wanted to close out of the red. The mind of the ordinary person in the street may well boggle at such esoteric, unproductive wizardry; it might also grasp how this exposes the central motivation for production under capitalism, how the very concept of profit is so obsessional that it has to be seen to be assuaged regardless of what actually goes on in the real, physical world where coal is physically dug out of the ground by real, living human beings.

We can see a similar unreality when we compare how election promises and party propaganda compare to what actually goes on in the world. This social system is characterised by some horrifying problems, many of them so outrageous that it is difficult to appreciate their full enormity How, for example, do we confront the fact that each year millions of people endure slow, tortured. degrading death through starvation while in EEC countries there is such a "surplus" of grain on the market that the British government are considering paying farmers up to £80 an acre to let their land lie fallow? How do we cope with the fact that the way capitalism uses nuclear power — Chernobyl was the most recent case in such a way that it threatens to blanket vast areas of the world under lethal radiation? How do we keep in proportion the fact that the nuclear powers have amassed enough destructive force to wipe us all out many times over and to leave the world in a condition which no sane person is likely to want to be alive in?

Such things can be accepted — they are accepted by tens of millions of workers — with a little help from the political equivalent of creative accountancy, in which reality becomes lost behind expediency. In some cases, the aim is to convince us that certain problems don’t exist. Unemployment, for example, is due to workers being unwilling to look for work. British nuclear power stations could not possibly blow up like Chernobyl, which everyone knows was made of substandard cardboard and elastic bands. The best medical care is freely available to even the poorest people in this country, which makes us all overflowing with health and vital energy. Of course there are a few matters which still trouble us but they will be dealt with — they are, in Thatcher's recent words, dragons yet to be slain. This style of argument looks good on the political balance sheets in election programmes, newspaper articles, speeches to the party faithful.

This technique has been applied with special vigour and skill to the issue of poverty. First, there is the attempt to convince us that poverty has been wiped out; it was a problem. it is conceded, in the days when the hunger marchers came down from the idle pits and shipyards and when miners were photographed scratching desolately on slag heaps. But things are different now. with millions of cars choking the roads, millions of homes wallowing in the luxury of TV sets, washing machines, microwave ovens . . . Children are better fed, better clothed, than ever. Pensioners, who were once in so desperate a plight that they formed their own pressure group, can now survive comfortably on their benefits, topped up with lunch clubs, charity outings and so on.

However, in the face of these complacent assurances, the poverty lobby persists in churning out facts about the suffering of people who exist on the barest minimum people who are malnourished, who dress in jumble sale cast-offs, who are under the extremities of stress. When the evidence to show that this is happening is too compelling to be denied, another technique is applied, which allows an admission that the problem exists but asserts that it can easily be solved with some adjustments in state benefits or by fiddling with tax thresholds and rates. This is what the Labour Party meant, when they claimed in their 1974 election manifesto that they would ". . .  eliminate poverty wherever it exists in Britain . . . achieve far greater equality of income, wealth and living standards..."

That was a very ambitious promise and since then both Labour and Tory governments have had their chance to bring it to reality. And what have they been able to do? In Britain today something like nine million people — about one sixth of the population live at or below the official poverty line, that is to say at or below the level of Supplementary Benefit. (It is not possible to be any more exact about the numbers because the last official count to be made public was taken in 1981, since when there has been a convenient official silence in the matter; however we do know that since 1981 more than a million people have been added to those on Supplementary Benefit). To put this into proportion, it should be stated what this poverty level is. A single person gets Supplementary Benefit of £29.50 a week; a couple £47.85; a family with two children £68.05, with housing costs paid separately. Not surprisingly. there is some feeling that a more realistic measure of poverty would be rather higher, say 40 per cent above Supplementary Benefit. This would increase the numbers in official poverty to about 15 million, or one in four of the population.

Apart from the official line, there are many ideas about what constitutes poverty. Keith Joseph thought that it is not being able to afford to eat (perhaps this has something to do with the fact that Joseph once preferred to dine on a slice of wrapped British Rail fruit cake - the kind of eccentricity that only the rich can safely indulge). In fact, malnutrition is by no means unknown to people on Supplementary Benefit. Mrs L has five children between 11 years and nine months; her husband is disabled and unemployed and can't lose the drink habit he developed when he was a building worker. Their home reeks of material decay and of despair. Mrs L subsists on a diet of tea and apathy. Then there is Mr J who was a factory manager, many years ago, until the strain of his job pushed him into a mental breakdown and wrecked his marriage. He lives alone now with his anxieties and his bitter memories of the days when he could at least afford to pay the bills. He is, quite simply, starving to death. People like this are beset with advice, from Norman Tebbit's caustic goadings to social workers' desperate attempts to get Mr L to give up his drinking, Mr J to balance his meagre benefits against the costs of living. Against the inexorable effects of poverty, they are fighting a losing battle. In 1984 nearly a million council tenants were behind with their rent, to the tune of about £240 million; 1.5 million electricity users and over one million gas users are currently in serious difficulty over paying their fuel bills; nearly 11,000 people had homes which were described as "theirs" repossessed through mortgage arrears in 1985 — a fourfold increase since 1979. These symptoms are such as can be costed, recorded, put into statistical tables. Less calculable are the other, equally devastating effects of deep poverty — the inability to afford adequate clothes, or decent furniture, or a warm home in winter, or a holiday, or an outing . . .

In one degree or another these deficiencies, or the fear of them, exert a constant pressure on the entire working class — on everyone who depends on employment to live. There is however another group of people who can fall sick, or drink more than is good for them, without descending into unmanageable destitution. The present John Paul Getty suffers from a persistent disorder in his blood circulation; for the past 18 months he has been staying at the London Clinic, where it costs at least £200 a day to be a patient. This is no problem to Getty for his weekly income is in excess of £1 million. The Duke of Westminster recently suffered a reduction in his income, not because he was ill and off work but as a result of the 1967 Leasehold Reform Act which, the Duke complains. has cost his estate about £2½ million in income. There is no need to feel sorry for the Duke, or to offer him considerate advice for he is the richest man in England but we might speculate on the scale of ownership of the means of life which is required to produce an income of £2½ million and reflect that that is only a part of which the Duke owns and a fraction of his income.

Poverty is persistent because it springsfrom the existence of two classes in society — one which includes Getty and the Duke, who own the means of wealth production and distribution, and the other which includes Mrs L and Mr J who don’t own them. This second class needs to be in employment in order to live. When they are in work (although they often tell themselves that they are not impoverished) they receive wages which in general, overall terms amount to about enough to reproduce their working abilities. If for any reason they can't command a wage — if they are out of work or disabled or mentally ill or a single parent — they quickly slide down to the lower reaches of poverty where their very health is at immediate risk. Poverty can't be abolished unless something is done about the way society is organised at its basis. Reforms which promise an end to poverty at the most change its shape, or rearrange its emphasis, or shift its burden from one group of workers to another.

This is what has happened in recent years. The whole system of what is mis-called social security was based on the assumption that unemployment would never again amount to much and that workers who were in work would earn enough to fulfil the modest expectations about their standard of living without any state benefits. One consequence of this was that pensioners were relegated to the lower levels of poverty; in the early 1970s they made up a little over 50 per cent of Britain's worst-off people. There was much doleful debate, during the 1950s and 1960s, about the increase in the numbers of pensioners and about whether "the country" could "afford" to pay out more and more in benefits to them. And then the recession came to change the picture. In 1981 unemployment was said to be responsible for nearly three million people being at or below the official poverty line and was exerting a downward pressure on the wages of those in work. Nearly one million employed workers in Britain earn less than what the European Social Charter specifies as the "decency" wage and over a third of all adults off dally classified as being in poverty are families where the "head" is in full-time employment. Pensioners have now be superseded, as the worst sufferers from poverty, by couples, with or without children, who are in work.

Reformists and pressure groups, in which capitalism abounds, tell us that there is great merit in this shifting of the burden of poverty from one group of workers to another while the capitalist class enjoy their privileged riches. Some years ago, for example, there was a heated debate about whether allowance should be paid by voucher to the mother or to the father by means of an "income tax allowance". It was, as we say, a heated debate — so hot that it shrivelled the important issue of why workers should bother about so trivial an adjustment in their poverty. But the reformers had their way. As long as the working class allow this to continue their poverty, which cruelly represses them, degrades them and often kills them, will continue and the issue of creatively  ending it will not be confronted.

Ivan

Harder times for the unemployed (1996)

From the October 1996 issue of the Socialist Standard

There is nothing governments can do to solve the capitalist problem of unemployment. Indeed, there is little talk these days about 'solving' it, the emphasis is simply on what to do with the 'culprits'

From October Unemployment Benefit—the Dole—will be known as the “Job Seekers Allowance”. Along with this will come targeting agreements, directives, responsibilities, job plans, prescribed programmes, reviews and flexibility. Buried under the tarnished gloss of this jargon lie compulsion, regimentation, sanctions and hardship for those who challenge the myth of exploitation by an employer as a “choice”. It means that the Tory government have finally recognised that the exercise of continually massaging the jobless figures is a worn-out facade and that the use of coercion is the only alternative in an effort to reduce the cost of maintaining the jobless white at the same time this will provide an opportunity for employers to take full advantage of short-term orders and low stocks for which cheap casual labour is ideally suited.

Austerity measures

The JSA should be viewed in the context of a long list of austerity measures affecting Social Security payments over many years. With the cost of Social Security a burden on the capitalist class all changes have been implemented with a view to reducing this financial bill. But paradoxically government intentions have not been matched by the reality. For despite the efforts to deter claimants by increasing the complexity and size of the benefit forms, along with tougher criteria on claimants' entitlement, the working class under the pressure of circumstances have in increasing numbers applied resourcefulness to find loopholes in the DSS minefield. Hence, the total bill for running the DSS has escalated to £93 billion. Whilst actual payments have decreased in relative value the total number of claimants has actually increased—along with fraud and the take-up rate for different benefits. Yet fortunately for the capitalists the take-up rate still falls far short of that estimated, resulting in a surplus of £3.2 billion returned to the Treasury in 1995/96, the difference between expected claimants and actual payments.

The government hope that the full enforcement of the sanctions contained within the JSA will make substantial savings and reductions in the unemployment register. Firstly by deterring registration, and secondly by placing the onus of finding a job on the individual claimant irrespective of the state of the labour market. By ignoring the fact that labour market demand is virtually stagnant and that the unemployed reserve are on hold until more production becomes profitable, it is a short step to asserting that the non-existent jobs are really there and that it only needs the unemployed to become “Jobseekers” to winkle them out or even to create them.

Workers who disagree with their Job Agreement (which is in fact a contractual obligation backed up by penalty reductions in benefit if not carried out) and its clauses of Job Plan, Jobseekers Directives, Review Procedure, regular attendance at Job Centres for “active signing” and are unable to prove they are “actively seeking work”, can expect a withdrawal of benefit for 1 to 26 weeks, or at least be faced with the misery of applying for hardship payments for their dependants only.

When these measures are combined with the changes that have already taken place in limiting Unemployment Benefit, Housing Benefit and Mortgage Interest payments and the action taken to align accommodation with the circumstances of unemployment through a notional “Relevant Rent” —take your choice, bedsit or doorway—they amount to increasing oppression and frustration for the unemployed.

Job Centre chaos

It is not only the claimants who are going to suffer the consequences of implementing the sanctions contained in the JSA. On the other side of the counters are another group of workers who have to deal with the short fuses generated by capitalism in a panic. On them falls the burden of being the paid enforcers when it comes to applying the sanctions. To help them in their endeavours they will be computer-linked with other Job Centres nation-wide and with the local labour Market System so they can ensure claimants are targeted and doing the rounds and that the Job Centres are also expected to reach the target demanded by Peter Lilley of 25 percent efficiency savings over the next three years. On top of this they will have received training in counselling skills to persuade claimants that the various options (which they have no choice on), contained within their Job Plan—retraining, employment placement; voluntary-work; signing up with employment agencies etc. are all in the claimants’ short-term interests, provided that is that they are happy to ignore the low wages, part-time and casual one-hour contracts and adverse working conditions which are not even acceptable to the low standards of the Health and Safety Executive. In order to protect Job Centre staff from the expected fallout from the outraged claimants who have sussed they have been classified as forced labour, the staff will be enclosed in booths protected by hardened shatterproof Perspex with security guards patrolling the floor.

Such a volatile situation with workers blaming each other instead of the system of wage slavery can only be expected from capitalism. Indeed as long as capitalism lasts the workers’ relative misery', destitution and deprivation will continue to fluctuate with the sway of boom and crisis.

This continuing uncertainty will find no relief by supporting the Labour Party. They have made it quite clear they agree with Peter Lilley that some form of sanctions are necessary for the unemployed. Their total agreement with letting the market set its own level of compulsion is sufficient testimony to the fact that they will end up doing much the same as the Tory ratbags are now applying. In any event it is not which party is in government but the compulsion built-in to the wages system that is detrimental to human relationships and the obstacle to our social well-being.

Gravedigger

National Insurance. The Wonderful World of Pensions for All. (1942)

From the February 1942 issue of the Socialist Standard

With the turn of the year, the weekly national health and pensions insurance deduction has been increased by one penny. It sounds little enough in itself, but one needs to be only a little bit behind the scenes to realise what a gigantic farce is this one facet of the capitalist structure. At a time when the cities of Britain are holding waste paper “drives,” thousands of leaflets have been printed giving particulars of the new deductions, values of stamps to be affixed, etc., etc.; head offices of giant concerns have sent out thousands more circulars; overworked wages clerks all over the country, at a time when all effort is supposed to be directed towards the practical furtherance of the war, are poring over the circulars and spending many extra hours, often unpaid for, in altering the pay sheets and balancing the deductions. Clerks in post offices and insurance companies are similarly affected. Millions of unused stamps will have to go back to the paper mills. Fresh stamp dies must be cast. From a purely monetary point of view, several thousands more pounds a year will come into the Exchequer ; so far as the worker is concerned, it will be only another penny off his wages, and he won’t notice it—any more than he has noticed the slow rise in the cost of living (a slow rise is so much more imperceptible than a rapid one), the reduction in the meat ration, the jam ration, and the income-tax deduction—after all, his wages have gone up. Keep on piling straws on to the camel’s back is the principle adopted, one day his knees will begin to bend, and then, before it is too late, you can take the last straw off again.

Of course, we know the old age pension has been increased. It now amounts to the large sum of twelve shillings a week. Actuarial accountants love to work out these little sums—so much per week on the weekly contribution, so much extra on the old age pension. But the funny part about it is that these increases take place just at a time when all the old age pensioners have elbowed their way back into industry again and are hard at it, together with the “too old at forty’s,” lathe turning, portering, rivetting, and so on.

It is questionable whether pensions insurance is any more upon an “actuarial” basis than unemployment “insurance.” As anybody who has followed the ups and downs of unemployment insurance is aware, during periods of depression large sums have to be taken from the proceeds of general taxation to augment the unemployment fund, the process being reversed during periods of “good” trade. In the present instance, the decrease in the civilian death rate indicates an improvement in the health of the population, so that the expenditure upon sickness benefit should less; the average total weekly increase in deductions is 2d. (1d. employer, 1d. worker), the increase in pensions is 2s. ; is one worker in twelve in receipt of an old age pension?

Capitalism is much the same everywhere. The New York Nation of November 8th last states that it now appears certain that “the U.S. Treasury will rely on a substantial increase in the pay-roll taxes levied under the Social Security Act for a major part of the additional revenues required for the 1942 tax bill.” “One proposal, which apparently has strong support within the Treasury Department, calls for raising the employee’s contribution to the old age and survivor’s insurance fund from the present one per cent. to five per cent., and increasing the levy which supports unemployment insurance. The possibility of combining old age, survivors’, disability and unemployment insurance in one system, supported by a tax of approximately six per cent., is also being studied.” Commenting upon this, the Nation states, “It would undoubtedly reduce purchasing power, but since it would fall predominantly on low-income families, its chief effect would be to cut down the consumption of food and other everyday necessities,” and, further on, “On the pretext of extending the benefits of social insurance, it would adopt a brazen soak-the-poor tax bill.”

But putting high salaried actuaries on one side for the moment, what is the practical effect of the recent change? Relatively, the position is the same as before—the worker has a bob or so stopped out of his wages, the old age pensioner can still manage to escape the workhouse by sponging on his poor relatives or, if there are none, he can in most cases get a supplementary allowance from the public assistance committee, and the employers think they have done a nice little bit of business by making the worker bees save up for their old age, so saving the expense of keeping them in institutions. We hate to disillusion our capitalist masters, but would it make so much difference if the whole vast governmental apparatus of deductions, accounting and stamping were scrapped and the “pension” paid out of general taxation? Actually, it would make but little difference, for the worker’s wages always tend to equal the cost of living—after all, you must feed the beast to get the work out of him—so that deductions from wages tend to be counter-balanced by increases in wages, and in any case, it is the capitalist class themselves who fork out the bulk of the taxation. The whole business reminds one very much of the “octroi” system in France, where taxes are levied on all sorts of commodities coming through the gates of a city, thus bottling up the traffic on important roads. The principle is the same. The capitalist class have a great dislike of coughing up the necessary cash to run a necessarily expensive administration, so they think out all sorts of ways of passing the buck on to the worker, thus causing themselves more expense in the long run than would otherwise be the case.

But the even funnier part of the whole business is: the thousands of government clerks, many of them poring over and haggling about interpretations of regulations and enactments, deluding themselves with the idea that they are doing highly important work, and the workers taking it all in and saying “what a wonderful world we live in—a pension for all those who are too old to work.”

However, some workers don’t take it all in, and perhaps this short sketch will cause some enquiring new reader to make a more thorough examination of the capitalist society in which we live.

Ramo.

Political Notes: Rats and twisters (1985)

The Political Notes Column from the June 1985 issue of the Socialist Standard

Rats and twisters

The Tory government looks set to clobber another vulnerable section of the working class — the elderly — by abolishing the State Earnings Related Pensions Scheme (SERPS). This is part of Norman Fowler's Review of Social Security which, he claims, is intended to ensure that expenditure on Social Security is "targeted" at the most needy groups in society. The truth is that the capitalist class is beginning to panic at the cost of providing for the increasing number of old age pensioners in the population and are looking for ways to cut public expenditure on social security including pensions. (The Tories are also planning to end the death grant and maternity grant and to cut housing benefit.)

The alternative to SERPS being offered to workers is that they top up their basic state pension (insufficient on its own to provide even the basic necessities of life) by paying into private pension schemes during their working lives. This of course assumes that we have jobs that pay enough that we can afford to do this.

When these changes were aired in the House of Commons recently the Labour Party leadership s criticisms of the new measures were largely confined to gripes about the Tories "ratting'' on an election pledge leading to the accusation by that model of political integrity, Neil Kinnock, that Thatcher was a "twister". Clearly this display was intended only to discredit the Tories in the eyes of the electorate. No one in the Labour Party or any other party present in the House of Commons during this exchange questioned the system of society in which elderly workers who have outlived their usefulness to capitalism are then forced to suffer the indignity of poverty in their old age.

Any capitalist government, whether Tory. Labour or Alliance, will only pay the minimum in social security benefits and pensions that it can get away with without their electoral fortunes being adversely affected. The Labour Party, that self-appointed champion of social justice, is clearly far more concerned to show up the Tories in the worst possible light and so damage their electoral chances than to ask fundamental and urgent questions about the nature of capitalist society.

Young, jobless, homeless . . .

At the beginning of May this year new rules governing payment of board and lodging allowances to young unemployed people came into force, which will make the plight of these particular victims of capitalism still worse. Under the new rules Supplementary Benefit claimants under the age of 25 and living in hostels, lodgings or bed and breakfast accommodation are likely to have their benefit cut unless they move to another area or return to their parents’ home.

These rule changes have come about as a result of revelations last year that seaside bed and breakfast establishments in the south of England were advertising in areas of high unemployment like Merseyside, in the belief that if they attracted claimants as residents they could charge high rents which would then be paid by social security. The impression given by the press was that large numbers of unemployed were living in luxury in hotels at the seaside at the expense of the state.

In fact most bed and breakfast establishments which cater for claimants are grossly overcrowded and of a very low standard — whether they are situated in Brighton or Toxteth, and no unemployed person would choose to live in them if they had an alternative. These owners are not acting altruistically by providing "free" holidays for claimants but are merely exploiting a lucrative loophole in Social Security rules.

The new rules mean that young unemployed people forced for whatever reason to live in this kind of accommodation. will only be able to claim the full cost of their lodgings for a limited period after which time they will be forced either to move or try to manage on still less money. (And these changes will not just affect those living at the seaside.) The intention is to force them to return to the "family home". Of course this assumes that not only is there a "family home” to return to but also that they are welcome there and that the family is in a position to support an additional adult member of the family. Most people living in hostel or bed and breakfast accommodation are there precisely because such an alternative does not exist for them.

These callous new rules for lodging allowance are likely to increase homelessness, vagrancy and poverty among a section of the working class that is surplus to capital's requirement and therefore particularly vulnerable.

Wasted, minister

The government, following the recommendations of the Commons Trade and Industry Committee's report The Wealth of Waste, has appointed David Trippier as minister with responsibility for recycling waste. It might have been thought that this job would fall within the jurisdiction of the Department of the Environment. However, the fact that the new "Waste" minister is to be located instead within the Department of Trade and Industry gives us some clue to the real purpose behind the new appointment (that is. besides the obviously political one of being seen by the increasing proportion of the electorate who are concerned about ecological issues to be "doing something about the environment").

Clearly it is believed that there might be some money to be made in the recycling of waste. All the evidence, however, suggests that in fact the opposite is true: ecologically sound production and recycling of waste products cost more, which is why there is so much resistance to them. Despite the fact that the value of materials "lost" to industry is estimated to be £750 million (The Times, 16 April 1985), the cost of reclaiming such valuable resources as paper, glass, aluminium and copper is prohibitively high. To produce recycled paper, for example, can cost more than producing new paper.

Given the nature of capitalist production for profit it is therefore simply idealistic for people like Jonathan Porritt (director of Friends of the Earth) to express the hope that the government will make "a substantial and unequivocal commitment on recycling” (The Times, 16 April 1985). So long as profit is the purpose of production even the most well-intentioned, ecologically minded government will encounter serious resistance to ecologically sound but expensive production methods.

A Degrading Relationship (1967)

From the March 1967 issue of the Socialist Standard

The man with a black brief case and an aura of the National Assistance Board stood in the doorway . . . “I am looking for a Mr. So & So”, he began, and added . . . ‘I am from the Ministry of Social Security”. . .

The new era of capitalistic '‘Social Justice” had arrived, grandiloquent title and all.

I directed him up the Edwardian staircase to a proletarian attic, and brusquely swinging his case of “social security” he mounted the stairs to dispense it. But behind the new title and the suave officials, it may be timely to enquire whether the old relationship that existed between the National Assistance Board and its applicants has been abolished along with the title?

What was that relationship anyway?

The following incidents, witnessed by the writer in 1965, may serve as an illustration . . .

A long queue of the destitute moved slowly over a wooden bench as their surnames were lustily echoed to the rafters by an NAB. official whose voice would have done justice to a court crier.

The dejected queue moves one by one before a tough looking receptionist who demands of each . . . “Name & Address” . . . which he busily scribbles down. Then . . . “Have you signed on for work”?. . . “Yes”. . . “Then come and see us again in three days”. . . “But I am destitute”. . . “Well, try and hang on for another day or so, we don't pay out any money here before the three days rule”. . . Crestfallen, the majority shuffle out and count the weary days that must elapse for each fresh applicant.

One, however, an immigrant from the Emerald Isle threatens to break all the NAB windows if he does not get immediate aid. Significantly, he is given preferential treatment. This is the set up of bullying and degradation that existed under the NAB. On one side, the power of. the capitalist state machine, on the other, worn out hulks of those who spend their lives on the wages treadmill until they finally reach a bench at the NAB.

Nor can it be said that relations were any better under a previous state department —the Unemployment Assistance k Board . . . that notorious UAB of the Hungry Thirties which incorporated the Household Means Test in its obnoxious administration and under which the present writer received 34/- weekly for himself, wife and two children after the Inquisition had been well and truly applied.

Thirty years later, the NAB scale of 76/- plus rent allowance for each person has to be viewed against the rise in the cost of living that has occurred in the interval. This makes it clear that the share of the destitute in the “affluent” society is, to say the least, nothing to write home about.

However, we are not here concerned with the degree of relief from destitution authorised by successive Governments, but with the degrading social relationship between the haves and have nots arising from the class division inherent in a profit based economy. This subjection of the vast majority by a small ruling class, and the indignities following from this state of affairs, is what Socialists the world over are dedicated to destroy. When property society is finished, that eternal plaint of capitalism . . . “Brother, can you spare a dime?”. . . will go down in history as the scene of disease which plagued humanity far too long.

G. R. Russell

Brown Reorganises Poverty (2005)

From the March 2005 issue of the Socialist Standard 

They don’t give out more money, they just give out the same money in different directions. And the more they change the systems, the less the system changes.

The Labour government is in the process of introducing new measures through the inclusion in the social security system of tax credits which more than likely will not only deter workers from claiming their full entitlement to benefits, but not claim any at all.

Gordon Brown and his team in the Treasury are trying their hardest to put over the image that these new measures are a direct assault on child poverty when in fact all they are doing is keeping the annual budget for social security stable around the figure of £100 billion, knowing full well that once it starts going over this amount his future career in politics will be on the line. So despite the fact that politicians go through the pretence of improving certain features of social security, it is nothing else than shadow boxing around the issue of child poverty. For there’s no intention, so far as this government (or any other whatever its political hue) is concerned, of doling out any new money.

By the time the full package of the current social security overhaul is completed a new means of administering and calculating entitlement to social security benefits will be in place, where the emphasis will be on the introduction of further means-tested benefits rather than on non-means-tested benefits.  Means-tested benefits, besides being far more costly to administer than non-means-tested ones, are subject to bureaucratic hold-ups where the claimant suffers the consequences of waiting anything from 6 to 13 weeks for their claim to be processed, leading to a crisis period when you’re unsure if your claim will be successful or not.

 

Ever since its introduction in 1948 the social security system and in particular its means-tested benefits has been notoriously associated with compulsion, complexity and confusion and it’s likely that the outcome of these changes will mean more of the same.  Indeed, for many claimants the benefits system is in total and permanent disarray where the possibility of obtaining a ‘fair shake’ in an effort to maximize their full entitlement to benefits depends on their individual skills in negotiating a legal minefield with sanity intact.

 

So it is no surprise that the bureaucratic nightmare associated with social security claims has resulted in a significant increase in the percentage of workers finding it is not worth the hassle.  For example, in Rhondda Cynon Taf alone, it is estimated by the census that there are some 6,000 individuals who despite being entitled to some kind of social security do not claim any whatsoever.  Nationally, there are also estimates of approximately 800,000 pensioners who fail to claim their full entitlement to a various array of benefits.  These are just some of the many reasons why £6.2 billion was returned to the Treasury in 2002-3 in unclaimed benefits. But these figures also suggest that, when considered as a whole, the barriers of compulsion, complexity and confusion are inherent to the social security system. As such they are proving to be effective bureaucratic deterrents for claimants, thus keeping the burden on the capitalist class of meeting the cost of maintenance and reproduction of the non-working section of the working class below what they have estimated. These estimates are in any event is based on a growing domestic economy and, when this is no longer the case, historically social security is hit the first and hardest.

The introduction of tax credits also includes major changes in the administration and payment of social security, and especially who is legally responsible for any mistakes that are made by either the claimants or bureaucrats. Whilst both benefits and tax credits are part and parcel of the social security system, currently the Department of Works and Pensions (DWP) are responsible for the paper chase and payment of benefits, and only responsible for the administration of tax credits, whilst the Inland Revenue is solely responsible for the payment of tax credits.  Eventually, it is planned that the DWP will deal only with the administration of benefits and tax credits and the Inland Revenue with the payments of all social security and tax credits. Obviously, during this transition period there is a considerable amount of bureaucratic and legal overlap between the DWP and the Inland Revenue, resulting in further increases in the miscalculation of benefits.

Under the previous Department of Social Security, any overpayments were the responsibility of the local office to correct and if the overpayment was through a miscalculation – made by them – it effectively meant that under the law, as it then stood; the claimant was not compelled to make a repayment. Although this obvious loophole must have cost millions in lost revenue, it most certainly left many a claimant with a knowing smile every giro day. For under the previous law the claimant could not be punished or held responsible for someone else’s mistake.   The change in the law now means that the claimant is held responsible for notifying the DWP of the miscalculation even when it’s the department’s mistake.  But even when the miscalculation is corrected, the problems for the claimants – especially those on Working Tax Credit (WTC) – don’t end there for the overpayments in tax credits can go on being paid until the end of the tax year.  This means in effect that WTC claimants in particular can face a comparative mountain of debt, whether they are responsible for it or not.

But the problems for the 6 million claimants of WTC still don’t stop there. On its introduction Gordon Brown hailed it as a radical step forward in providing a stepping-stone out of the dependency and poverty trap by granting those on low wages a top-up, dependent on their circumstances. What he didn’t say was that when the claimant actually took that step to increase their financial prospects in the labour market they enter a new tax bracket, which is then calculated over the whole year and also puts them outside the scope of WTC. Which meant for the former WTC claimant who followed Brown’s advice, the Inland Revenue could in effect penalize them to the tune of £2000 to £3000 in backdated overpayments of WTC, thus wiping out any corresponding increases in wages.

For the WTC claimant it means, if they don’t want to be faced with a hefty demand from the Inland Revenue, to fine-tune any changes in the job market so that their income corresponds to the yearly tax demand. Presently, approximately 2 million claimants, or around 33 percent of the total claimants for WTC, are facing the prospect of paying these repayments within the next twelve months. If they fail to meet this deadline, which undoubtedly many of them will, they face being saddled with a further bill for the interest on the amount still owing – which is usually over the basic rate of interest charged by the banks. Gordon Brown, the CEO of Financial Operations GB plc, with a client base of 2 million, has probably created the biggest loan-shark business in Europe, feeding off the poverty of those workers who are trying their hardest to improve their means of living.

Brian Johnson

An Implement For Digging (1976)

From the April 1976 issue of the Socialist Standard

Have you noticed the way today’s politicians are afraid to call a spade a spade and instead resort to every kind of euphemism to disguise the reality of whatever they happen to be talking about? So we have “social security”—the Poor Law or National Assistance by any other name—a cynical term indeed. Ask anyone who’s ever had to claim and they'll tell you there’s little that’s social and nothing that’s secure about it. Perhaps you’ve experienced yourself the interminable form-filling and prying by clerks for a pittance that won’t feed a dog, let alone keep it warm.

We have the “Department of Employment”. I wonder what the one and a half million on the dole would say about that, the Industrial Reserve Army as Marx put it?

What other contenders are there? How about “an expanding economy”? An expression that looks a little sick in these days. How about “the underprivileged”: politicianese for the poor and the deprived—members of the working class in other words. But let us not forget “the affluent society” (it’s been a good year for grinding the faces of the workers); “we have got to pay our way in the world” (we’re going to turn the rack a few more notches); “nobody owes us a living” (your tomorrow, the promised land is just over the next hill); and, to end a short selection, “welfare state” (80,000 will die this year from hypothermia).

Politicians are the mouthpieces and the lackeys of the capitalist system which needs to dupe the mass of the people in order to maintain itself in power. The contrast between the humbug of political pronouncements and the struggle for survival of the working class worldwide cries out for a solution. That solution can be achieved—Socialism, which will finally make politicians redundant when it replaces capitalism across the globe.

Workers of the world unite—you have nothing to lose but your leaders.

A. L.

Fowler reorganises poverty (1985)

From the August 1985 issue of the Socialist Standard

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

More Trouble about the Means Test (1967)

From the August 1967 issue of the Socialist Standard

A “Means Test” is defined by Chambers dictionary as test of private resources determining or limiting claim to a pension or allowance.

Such tests are centuries old. Ever since the time, four or five centuries ago, when governments and local authorities began to take over from religious bodies and private charity the obligation of supporting the destitute, there have always been tests of “Means” or “Needs*'.

It is a perennial problem of capitalism and no matter how many times the relief system has been reformed and given new names no solution has been found.

Even if we leave out of account the fact that workers generally do not consider their wages sufficient to meet their own ideas of reasonable needs, and consider only the question of a bare subsistence, capitalism cannot guarantee that workers will always have it provided. Capitalism cannot guarantee continuous employment and cannot even guarantee that wages will always be sufficient to provide bate subsistence.

So unless the authorities were prepared to let the destitute starve (and put up with consequent unemployed riots and encouragement to theft) they hail to pay out state and local government funds. But they could not let the applicants name their own figure for the money they wanted, nor could they fix their own figure and let everyone have it who applied.

If they had done this it would have acted as an inducement to workers in low paid jobs simply to give them up.

The authorities tried everything from the “whipping of beggars” in Tudor and Elizabethan times, to making them go into the hated workhouses, or work colonies, breaking up families, offering assistance in the form of food, making the unemployed prove they were genuinely seeking work, and applying means tests which subjected the applicants to official enquiry to demonstrate that they really were near destitution.

Then came schemes of compulsory contributions to provide for the payment of specified benefits in sickness, unemployment and old age but although this altered the form of the problem it did not abolish it, did not free the applicant from satisfying conditions laid down in the regulations and did not abolish destitution—there are still about two million people who in the course of a year get public assistance (recently re-named Social Security supplementary benefits).

In an article in the Guardian (2.6.67) Mr. Peter Jenkins states that “seventeen forms of benefit are subject to Means Tests of one form or another.”

No Means Test is popular but the most detested forms of test are those which go beyond the applicant and take into recount the means of other members of the household family.

It was a household means test which was one of the explosive political issues of the nineteen thirties. The National Government which came into office in August 1931 decided to apply to unemployment pay a determination of needs regulation. It was not a new test because it had long existed for applicants for public assistance: what was new was to apply it to the unemployed who had exhausted their right to benefit. The continued payment of benefit was made dependent on the household income and the applicants' savings, ownership of a house or other property.

When the National Government introduced the necessary legislation the section of the Labour Party in opposition condemned it, but as those members of the Labour Party who were in the National Government pointed out, this measure had been approved by a majority of the Cabinet of the Labour Government while it was still in office as part of their extensive economy plans. (Details were published in the Socialist Standard October 1931).

That particular means test as applied to unemployment pay was abolished when Ernest Bevin was Minister of Labour in the war-time National Government in April 1941, but a similar though not so searching test was and still is applied to applicants for Supplementary Pensions. The applicant has to provide information about his own and his wife’s income from all sources, “including such items as pensions from former employers, regular payments from friends and relatives, and the assumed income from capital”, though twenty shillings a week of this “other income” is disregarded in determining the right to and amount of benefit.

Other forms of means test relate to the present government’s schemes for rent rebates and rate rebates. Mr. Richard Crossman in July 1966, at that time Housing Minister, urged local Authorities to put up rent of council houses to a “more realistic” level and to meet the situation of low-income tenants by giving them rebates, subject of course, to evidence of need. He was opposed by objectors who maintained that the authorities “have no right to interfere with individual liberty by prying into tenant’s means to assess a fair rent.” (Daily Mail 9.7.66).

In a typical rent relief scheme, that used by the Greater London Council while the Labour Party still controlled it, the applicant had to give full information about the income of himself and wife from all sources and also the name and age and family relationship of all persons living in the house. But instead of asking for information about the income of those persons the Council added to the estimated total income determining the right to relief an amount of fourteen shillings a week for each person aged 21 or over and seven shillings a week for each person aged 18-20.

Peter Jenkins in the article already referred to, now tells us that long argument had been going on inside the Cabinet about applying a new means test in connection with a proposed increase of family allowances which would raise the allowance for the third and subsequent children by ten shillings a week—he claims that the Ministers were almost equally divided, with only a majority of one against it. “With the Cabinet so astonishingly narrowly divided it is certain that the issue will come up again.”

With unconscious irony he tells that the advocates of the new Means Test “were able to argue that each according to his needs is equally a principle of socialism” — as if that socialist principle can have any possible connection with a device of capitalism to screw down the pittance provided for its victims.

Edgar Hardcastle

Observations: Special needs? (1986)

The Observations Column from the August 1986 issue of the Socialist Standard

Special needs?

In capitalism it is money that determines whether or not people's needs are met. This principle applies to the "welfare state" as much as it does to the market for goods. But in the case of the welfare state it is the government which has the power to decide whose needs are to be met (through the allocation of resources) and at what level.

Take, for instance, draft regulations recently drawn up by the DHSS which will restrict the availability of single, or "special", needs payments to supplementary benefit claimants. At present single payments are intended to cover the cost of such essential household items as beds, cookers, heaters, basic items of furniture, and bedding. It is already extremely difficult to obtain this assistance. But the government now intends to make it even more difficult, through the new regulations which will exclude payments for such things as hot water bottles for the elderly and infirm, curtains, cleaning implements. light fittings and other basic household equipment. Certain claimants, such as squatters, will not be eligible for any such payments at all.

The reason given for the new restrictions is contained in a DHSS memorandum (Guardian, 10 June 1986) which states that "there has been since 1981 a rapid and continuous growth in single payments" and "in these circumstances the Government now proposes to bring expenditure back to around the 1984 level . . . and to ensure an orderly administration of the single payment system in the two years before the Government reform proposals take place". (The "reform" referred to is the abolition of single payments and their replacement with a "Social Fund" which will apply even more restrictive criteria to applicants).

So more people are clearly in need and are seeking extra assistance from the DHSS. What is the government’s response? Those needs are first defined as "special needs” and met on a highly selective basis, and later redefined out of existence. And this is called "social security” — part of the "welfare state".


Diagnosis

There is a man in Broadmoor, sent there for killing his wife, who is a brilliant scientist. At the time he was working in the development of guidance systems for inter-continental missiles. An obsessive man, he was liable to bouts of morbid jealousy. One day his wife could stand no more and left him. After a while he gave up his job and walked, brooding, the hundred or so miles to where she was living and there he killed her. The missiles he had been working on are each capable of wiping out hundreds of thousands of people. At his trial the judge listened to social workers, police officers and psychiatrists and it was decided that killing his wife proved that the brilliant scientist was ill and must be locked away in a hospital until he is better.


Fair cops

There is enough for the people of Greater Manchester to worry about in the colourful menace of their Chief Constable, James Anderton, without all this shock-horror-probe stuff about his deputy John Stalker.

Like most of these sordid affairs, the Stalker scandal becomes more outrageous and ruthless with the dragging out of one piece of evidence after another, which hint at corruption and intrigue at what is called A Very High Level.

It all began when Stalker was given the job of looking into the shoot-to-kill policy of the Ulster police, under which some embarrassingly innocent victims had been mown down. If Stalker took this seriously he is at variance with most of the people who have any experience of these matters, who expect as a matter of course that such enquiries are really designed to sweep a scandal under the carpet.

Whatever the truth of this, there is evidence of a campaign to undermine Stalker's standing as a high ranking policeman by showing him up as an associate of criminals and of other people with a reputation for sailing rather too close to the legal winds.

There are many people who have been arrested and harassed by Anderton's and Stalker's police who coknow what it means to be subjected to a sustained persecution. They will probably appreciate the irony in the fact that the same sinister techniques are said to be now applied to Stalker.

How outrageous a scandal is it? A social system based on the interests of a small but powerful minority cannot be open about much of what goes on in the cause of protecting the standing of that minority. Secretiveness (and the British government is noted for its obsessive concern with secrecy and an elegantly worded suppression of the truth) is endemic to capitalism. When it is demanded, the welfare — even the life — of an individual is of no account; even the most devoted servants of capitalism are expendable.

There was, to put it another way, never the slightest chance that Stalker would be allowed to lift the lid off the RUC.

Meanwhile, the workers of Manchester and of the rest of capitalist society should concern themselves with such events only to take what lessons they can from them. The police are employed as a part of capitalism's coercive, privilege protecting machinery. Their role is repression, of people and of the truth when they need to. They do this to sustain a social system which, even were it morally immaculate, without a taint of evasion or corruption, would still be unsupportable for its impoverishment, degradation and murder of millions of human beings.

We must get on with working towards the abolition of this sordid mess, leaving that odious bunch of thugs and twisters to grass each other up.

Cooking the Books: What the Poor Law Pays (2018)

The Cooking the Books column from the March 2018 issue of the Socialist Standard

We know what determines the level of income of those in employment – it’s the cost of recreating their working skills in conjunction with the class struggle and the play of supply and demand – but what about those not in work? What determines the income they get as a handout from the state?

Some light on this was shed by some top secret documents found at the end of January in a filing cabinet in a junk shop in Australia. One of the files concerned the work of a cabinet sub-committee, known as the ‘razor gang’ (down under they call a spade a spade), whose remit was to slash payments to the unemployed as a way of relieving the burden of taxation on profits which had fallen in the slump that followed the financial crash of 2008.

Normally such documents only become available after 30 or so years, but the files related to a much more recent period:

‘One file revealed that Tony Abbott, the former prime minister, considered banning anyone under 30 from accessing income support in a radical proposal before the 2014 budget. Some of his ministers, it said, wanted to ban what the documents termed “job snobs” from receiving unemployment benefits.’

However, the then prime minister didn’t get his way:

‘The proposal was crushed by dissenters in his cabinet who feared that, if implemented, it might force jobless young people into homelessness, crime and other anti-social behaviour.’(Times, 1 February).

There you have it: what governments dole out to the those not in employment for one reason or another – ‘benefits’ doesn’t seem the right word – is the minimum they think they can get away with without provoking too much ‘anti-social behaviour’, in particular crime, which would cost them money to deal with.

Dealing with the unemployed and the unemployable has been a problem for capitalism right from its beginnings, premised as it is on the existence of a class without access to means to themselves produce what they need. In the first instance this involved driving people off the land, which began in England in the 16th century.

The first attempt to deal with this were the Poor Laws, which made providing for those unable to acquire any money to live the responsibility of the parish where they were born. Those who ventured away from their parish were denounced as ‘sturdy beggars’ – and whipped and branded, as Marx describes in chapter 28 of Volume I of Capital on the ‘Bloody Legislation against the Expropriated since the End of the Fifteenth Century’. Right up until the middle of the last century this remained administered locally by Poor Law ‘guardians’.

In 1948 the post-war Labour government made it a national responsibility, run by a board doling out ‘national assistance’. Over time the name changed, first to ‘social security’ (a nice Orwellian touch) and then to its present ‘income support’. But it’s still basically the ‘poor law’ with the government assuming the role of Dickens’s Poor Law Guardians, paying out as little as they can so as to minimise the burden on the capitalist class of maintaining those not in employment.

Basically, then, the answer to what determines the level of income of those not in employment is what the government thinks it can get away with without provoking riots or encouraging those affected to turn to crime.  It doesn't always work as the spontaneous riots of 2011 showed.