What have been the main points of disagreement between 'the left' and 'the right' in the United Kingdom around the welfare state?

What have been the main points of disagreement between ‘the left’ and ‘the right’ in the United Kingdom around the welfare state?

The "welfare state" usually refers to an ideal model of provision, where the state accepts responsibility for the provision of comprehensive and universal welfare for its citizens. The term ‘welfare state’ in the United Kingdom was suggested, following the second world war, to represent a vast expansion of state involvement in the provision of social welfare..

The objectives of the welfare were announced in 1942 by Sir William Beveridge, based around the theory of economist J.M Keynes, the architect of the post-war welfare reforms, as the abolition of ‘Want, Idleness, Squalor, Ignorance and Disease’, by which Beveridge meant poverty, unemployment, poor housing, and lack of access to decent health and education services. (Contemporary British Society, 3rd Edition, Abercrombie and Warde 2002) Asa Briggs(welfarestate.com) identified three principal elements of a welfare state model in the United Kingdom: a guarantee of minimum standards, including a minimum income; social protection in the event of insecurity, and the provision of services at the best level possible.

The major pillars, therefore,of the sought welfare state were a National Health Service which provides free health care to all citizens, education that was provided free of charge, a major slum clearence programme and expansion of low-rent housing, and a comprehensive social security system providing income security from the “cradle to the grave”(Beveridge 1942), through a range of benefitsfrom child allowances to old age pensions. The philosophy behind the Beveridge reforms was strongly influenced by the experience of the war years, when state planning and the allocation of resources through rationing of food and clothing provided.

It was the Second World War, in which more people perished than in the First World War, which led to the formation of the coalition of all parties formed under Prime Minister Churchill, working harmoniously to establish a full welfare state. Under his supervision the government adopted a policy of regulation for the economy, in order to ensure an efficient post-war effort and health for both military and civilians. (Richard Titmuss, Sociology Themes and Perspectives, Haralambos and Holborn, 5th Edition, Collins Educational) argues that the changes brought about by total war helped to create the conditions for the establishment of a welfare state.

The Labour government was elected to power in 1945-51. It was in 1946 that the welfare state was established as a development of the Beveridge report. Labour, introduced three key acts: the 1946 National Insurance Act, which implemented the Beveridge scheme for social security; the National Health Service Act 1946; and the 1948 National Assistance Act, which abolished the Poor Law while making provision for welfare services. These Acts were timed to come into force on the same day, 7th June 1948. The 1948 Children Act and the 1949 Housing Act. were other important elements.

The Conservative government continued Labour’s welfare policies from the year 1951 which lasted until 1964. As a result, the economy flourished and people thought that poverty had been abolished. However this post-war consensus collapsed in the mid-1970’s under the impact of recession, when the rate of economic growth became insufficient to subsidise both industrial recovery and the provision of expanding welfare services. Pierson (1997) points out, “under circumstances of recession, national product and revenue from taxation and insurance fall whilst claims upon welfare provision, particularly income support, rise.” In the 1970’s this situation was diagnosed as a crisis. Political strategists, of both left wing and right-wing persuasions, concluded that because popular demand for welfare spending was inexhaustible, pressures for more public expenditure necessarily compounded economic problems. Governments, firstly Labour, then Conservative, sought ways to alleviate the situation. The two parties diverged, suggesting different solutions to both social and economic problems. The uneasy consensus that supported the post-war settlement collapsed, challenged most fundamentally to whose policies the prime minister elected in 1979 gave her name – Thatcherism. (Contemporary British Society, 3rd Edition, Abercrombie and Warde 2002 pg.436)

Margaret Thatcher was elected in 1979 under Conservative government with “commitment to anti-collectivist free market principle.” Following neo-liberal directions, they were aimed at reducing the role of the in the management of economic activity and welfare provision and increasing that of the private sectors and market competition. Social commentators such as Marsland (1989) and Murray (1984) had established in Mrs Thatcher a detestation of the ‘culture of dependency’, where individual and family independence had been withered by creeping welfare statism. (Contemporary British Society, 3rd Edition, Abercrombie and Warde 2002 pg.436.)

The Conservatives subsequently placed an interconnected set of policies on public ...

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The Conservatives subsequently placed an interconnected set of policies on public spending, public and private sector employment and consumption, and trade union rights. These policies marked a fundamental departure from ‘the-lefts’ Keynesian social and economic management. Thatcher’s government were often described as ‘anti-welfare, anti-union and anti-egalitarian,’ (Contemporary British Society, 3rd Edition, Abercrombie and Warde 2002 pg.436)

The conservative’s believed in economic management through monetary policy, which sees government intervention in the economy as necessary for the stability of the economy. Public spending is an important regulator that can be used to stimulate the economy at a time of a slump or to pacify growth if it happens too quickly.

The most notable change in policy, however, brought in by conservatives was the end of the commitment to ‘Keynes’ theory of full employment that previous governments had encouraged. Thatcher and the conservatives believed in a “natural level of employment”. They felt that this “natural level of employment” was being undermined by wages being too high due to the actions of trade unions. Therefore, they argued that the market would solve unemployment by creating downward pressure on wages. Because of this, the differential between wages and benefits was increased by creating downward pressure on benefit levels and hence, welfare expenditure.

The Thatcher led conservatives replaced dependency with not just an enterprise, but also a ‘self-help’ culture. This old welfare state was accused by many including Boyson (1971) as being irresponsible and encouraging dependence, as well as promoting constraint and lacking in incentive.

In 1980, Thatcher, enacting an idea suggested and rejected by the Labour Government after 1974, offered council house tenants the right to buy their own house by the 1980 Housing Bill (Lee1996). By the end of Thatcher’s reign, over one million families or individuals became homeowners. The ‘assisted places scheme’ introduced in 1980 allowed able children from less well off backgrounds to secure means tested places at the country’s independent schools. In 1990, those over the age of the age of 60 were given tax relief on private health insurance, in an attempt to reduce the burden on the NHS and to expand the private sector.

Another subject was targeting help on the most worthy, which had been actively proposed by right-wing thinkers such as the Institute of Economic Affairs (IEA) for numerous years. Successive reforms of the social security system, beginning with the Social Security Act 1980 (Johnson 1990, Reconstructing the Welfare State: A Decade of Change), progressively tightened the eligibility rules for unemployment benefit, as well as the abolition of earnings-related supplements to unemployment and the taxation of unemployment benefits. Johnson points out that means testing was extended, as illustrated by the family credit scheme that replaced family income supplement and the changes made to the housing benefit system. Payouts from insurance-based benefits were also restricted, such as the cold weather payments, and the level of popular universal benefit paid to parents was frequently frozen year on year.

There was a further examination to increasing effectiveness and applying market disciplines to the education system and the NHS. The Griffiths Report of 1983 had led to the introduction of two hundred non-medical managers. Hospitals were also required to put contracts for services such as laundry, cleaning and catering out for competitive tendering. This allowed firms from the public or private sector to put in an offer to provide the service for a certain price, and the firm that offered to provide the service the most efficiently would be awarded with the contract. The NHS internal market gave GPs budgets and lead to hospitals competing for patients. Similarly, social service departments were to become purchasers of care for their elderly and disabled residents. With the 1988 Housing Act (Alcock, 1996, Social Policy in Britain: Themes and Issues, Macmillan, London), alternative landlords could take over individual council properties or whole estates with the agreement of the tenants.

The provision for schools to ‘opt out’ of local authority control, which was provided by the 1988 Education Act, enhanced parental control over their children's education and devolved budgetary responsibility to the schools themselves, so “important decisions would be taken at a level closest to parents and teachers” (Thatcher 1993, pg. 597). City Technology Colleges (CTCs) were formed to teach technical skills and together with Grant Maintained schools, were designed to give parents a greater variety of choice. The drive to introduce greater efficiency and competition extended to higher education. The Education Act 1988 abolished academic tenure, the system by which university academics were appointed for life, as the government believed that this provided little incentive to maintain high standards. The University Grants Commission was replaced by University Funding Council, to remove the excessive cost of increasing the number of students in higher education.

Taken together, the elements of the neo-liberal strategy employed by ‘the right’ shifted the role of the state from a provider of services to a “market or quasi-market relationship between suppliers and consumers in a decentralised and fragmented system.” As Jessop (1994 Contemporary British Society, 3rd Edition, Abercrombie and Warde 2002) observes, in contrast to the Keynesian welfare system became geared towards enhancing competitiveness in an internationalised economic framework, including the European Union and the International Monetary Foundation.

Despite the reforms undertook by ‘the right,’ led by Thatcher, economic uncertainty ensued. Black Wednesday in 1993 was an example of this. As a result voter confidence diminished, and the Conservatives in 1997, now led by John Major, were resoundingly beaten at the general election by ‘the left’- New Labour. Old labour had dispersed and in its place a remodelled Labour party led by Tony Blair et al had emerged, and with it the ‘Third Way.’

New Labour had inherited a vastly different welfare system from that which they inherited when last in office between 1974 and 1979, as well as economic issues. Pierson (1997) points out that: “Social Democratic Parties (such as old labour) across Europe have been challenged by new social movement politics.” For example, feminists had outlined the patriarchal nature of the welfare state with its differential, gendered allocation of rights and responsibilities. Similarly, anti-racist groups had demonstrated the racist assumptions and different entitlements obtaining between majority and minority ethnic groups. Disability groups campaigned over the discriminatory nature of welfare provision, likewise gay and lesbian groups argued against discrimination against same-sex couples. (Contemporary British Society, 3rd Edition, Abercrombie and Warde 2002 pg 439.)

‘New Labour’ was so-called because it set out to modernise economic and social institutions through ‘The Third Way’ – a hybrid programme that intended to transcend the neo-liberalism of ‘the right’ as well as the Keynesian approach adopted during post-war consensus politics, Tony Blair said “the left must modernize or die.”

New Labour sought to conjoin neo-liberalism with a welfare modernization programme based on social inclusion. New labour looked to redistribute opportunities as opposed to the redeployment of income or wealth. Tony Blair argued that the poor needed, “a hand-up, not a hand-out” meaning they needed to be given the support they required to help themselves rather than simply depending on state benefits. Old Labour had traditionally viewed social welfare as a key means of redressing the inequalities arising from markets; New labour accepts free-market capitalism and defines inequality as social exclusion from the opportunities it brings. (Contemporary British Society, 3rd Edition, Abercrombie and Warde 2002)

Among the early policies introduced were the launch of a Social Exclusion Unit, which was chaired by the prime minister, designed to help the socially ecluded reintegrate into society. According to Wintour and Cohen (1997), the unit was “to try to tackle truancy, discourage drug dependancy by withdrawing benefits for those who refused drug rehabilitation courses, and allow tenants more over big estates.”

A scheme was introduced to give lone parents, who wanted it, advice and guidance on how to get back to work. Also a scheme was introduced to help children who found it difficult to study at home, to partake in ‘homework clubs’ after school.

In addition money from a ‘windfall tax,’ which was generated by profits from utilities companies, such as gas and electric, was spent on providing more training and job opportunities for the unemployed. This ‘Welfare to Work’ scheme gave people, under the age of 25 that had been unemployed for six months or more, four options. Firstly subsidized employment with businesses. Secondly, for those without qualifications, up to twelve months full-time study. Thirdly, six months’ employment within the voluntary sector, and six months’ work with the environmental taskforce.

To compartmentalize ‘the left’ and ‘the rights’ disagreements and outlook on the welfare state into two distinctly separate categories would be overlooking the subject. There are many different sub categories on each ‘side’ that all have different opinions on the welfare state, some opinions which are extreme and therefore not mainstream for example, fascism - based in an authoritarian collectivism, liberal individualism - everyone is an individual, and that individuals have rights, and communism. In contrast some opinions, like the conservatives and labour, which are more conventional. However Post- war consensus politics showed the two parties concurring on the same welfare state policies originally stated by Beveridge. It was only when these policies became outdated in the 1970’s did conflicting principles begin to transpire between the opposing parties. Even then it is not straightforward, the voting public embraced Thatcher’s neo-liberalism and, thus 17 years occurred. At the same time Labour were forced to remould themselves as throughout the 1980’s when the individual prospered, their views seemed outdated and discarded by the electorate. New Labour was born in the mid 1990’s under John Smith and Tony Blair giving them a modern image required but this new party had shifted them from ‘the left’ towards the ‘centre’, and even in the direction of ‘centre-right.’ Alas the ‘left’ and the ‘right’ became blurred and contemporary society and politics will require a major u-turn to clearly and simply categorize the difference of opinion between ‘the left’ and ‘the right.’