Labour calls for rethink of welfare system

Liam Byrne, shadow secretary for work and pensions, writing in The Guardian, argues that the benefits system has betrayed its founding principles and ‘skewed social behaviour’. Byrne calls for a radical rethink of the welfare state, and argues that Labour must recast the welfare state to meet the original intentions of its founder, William Beveridge.

In his article:

  • Byrne identifies the spiralling housing benefit budget, benefits for long-term unemployment, and the lack of proper incentives to reward responsible long-term savers as three key flaws in the current welfare state. He writes: ‘Beveridge would scarcely believe that housing benefit alone is costing the country over £20bn a year. That is simply too high.’
  • As part of that rethink, Byrne hints that the contributory principle should be restored as a building block of the welfare state so there is a clearer link between what people put in and what they receive.
  • Byrne believes the centre ground of politics has shifted to the left on issues such as bankers and equality, but that most voters, including traditional Labour supporters, still want a tough line on welfare.
  • Byrne argues that Beveridge had never constructed his system to accommodate extended mass unemployment. ‘Beveridge would have wanted reform that was tough-minded and asked everyone to work hard to find a job. He would have worried about the ways his system had skewed social behaviour because he intended benefits to help people who had their earning power interrupted because of illness, industrial injury or the capriciousness of the trade cycle. He never foresaw unearned support as desirable.’ Byrne points out that Beveridge himself wrote: ‘Unemployment benefit after a certain period should be conditional upon attendance at a work or training centre.’
  • Byrne echoes Ed Miliband’s call for a responsible society, which applied as much at the bottom as at the top of society.

The full article can be found at The Guardian website. Byrne’s article generated a good deal of debate on both sides of the argument.

See also:

An insult to the memory of Beveridge’, The Guardian, 3 January 2012

Liam Byrne is right – we need “radical reform” of the initiative-zapping, soul-destroying welfare state’, The Telegraph, 3 January 2012

Contribution is not capitulation’, LabourList, 5 January 2012