{"id":2147,"date":"2023-11-14T15:49:28","date_gmt":"2023-11-14T15:49:28","guid":{"rendered":"https:\/\/blogs.bath.ac.uk\/iprblog\/?p=2147"},"modified":"2023-11-14T15:49:28","modified_gmt":"2023-11-14T15:49:28","slug":"reaping-the-benefits-of-social-security-reform","status":"publish","type":"post","link":"https:\/\/blogs.bath.ac.uk\/iprblog\/2023\/11\/14\/reaping-the-benefits-of-social-security-reform\/","title":{"rendered":"Reaping the benefits of Social Security reform"},"content":{"rendered":"
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In this piece, Professor Jane Millar sets out three priority areas for a comprehensive review and a new vision for social security in the UK. Jane Millar<\/a> is Emeritus Professor of Social Policy in the Institute for Policy Research (IPR)<\/a> at the University of Bath. This blog was originally published<\/a> by the Academy of Social Sciences<\/a> via their Election 24 Hub<\/a>.\u00a0<\/em><\/p>\n<\/div>\n<\/section>\n

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Social security benefits have been\u00a0cut significantly<\/u><\/a>\u00a0in the austerity years.\u00a0Means-testing<\/u><\/a>\u00a0has moved centre stage.\u00a0Conditionality rules and sanctions<\/a>\u00a0are built into the system. So are\u00a0benefit deductions<\/u><\/a>. We need a new vision and a clear plan.<\/p>\n

This should include principles to guide policy and delivery.\u00a0Ruth Lister<\/u><\/a>\u00a0summarises these as including universality, adequacy, dignity, respect, non-discrimination, and gender equality.<\/p>\n

We also need to recognise what social security cannot do. Beveridge\u2019s social security\u00a0plan<\/u><\/a>\u00a0assumed there would be family allowances, high levels of employment, and accessible universal health services. We still need these. And more \u2013 fair wages and employment conditions, good quality and affordable housing (including basic amenities), universal and free childcare provision. This would reduce the demands on social security.<\/p>\n

Three priority areas<\/h3>\n

Immediate action is needed on several fronts. My list focuses on non-pensioners, see the recent IFS discussion of\u00a0pension reforms<\/u><\/a>.<\/p>\n

1. Benefits for families with children<\/h4>\n

There are\u00a04.2 million children<\/u><\/a>\u00a0living in poverty in 2021\/22 (equivalent household income below 60% of the median, after housing costs).<\/p>\n

Parents seek to\u00a0protect their children<\/u><\/a>\u00a0from poverty, often at the expense of their own health and wellbeing. But childhood poverty has both immediate and longer-term consequences. Children in poverty\u00a0go without the basics<\/u><\/a>\u00a0of adequate food, clothing, homes, and heating. They\u00a0miss out<\/u><\/a>\u00a0on everyday activities such as play, outings, sports and clubs, and school trips.\u00a0 Over the\u00a0longer-term there are impacts<\/u><\/a>\u00a0on health and life expectancy, on educational experience and attainment, and on job opportunities and wages.<\/p>\n

Tackling child poverty requires a wide-ranging approach across many areas of government, national and local. But more money to families with children is an essential element in any child poverty strategy.<\/p>\n

Child Benefit is the best way to do this. It provides a non-means-tested and regular payment. The\u00a0current rates<\/u><\/a>\u00a0(2023\/24) are \u00a324.00 per week for the eldest or only child and \u00a315.90 for other children.\u00a0Child Poverty Action Group<\/u><\/a>\u00a0recommend an increase of \u00a320 per child per week.<\/p>\n

The Higher Income Child Benefit Charge claws back some of the benefit from families where the highest earner has an income above \u00a350,000. It adds significant\u00a0administrative burden to families and HMRC<\/u><\/a>\u00a0and creates\u00a0very high marginal tax rates<\/u><\/a>. The charge should be abolished so that Child Benefit can return to being a simple and universal financial contribution to the costs of raising children for all families.<\/p>\n

Also in line for immediate abolition are the benefit cap and the two-child limit. Both restrict the amount of benefit that families can receive. This hits large families particularly hard and\u00a0recent research<\/u><\/a>\u00a0concludes that these measures \u201creduce family income, increase hardship and place a strain on familial relationships and mental health\u201d. Abolition would bring relief to many of the poorest and most hard pressed families.<\/p>\n

2. Rebuild social insurance<\/h4>\n

Protection against interruption of earnings is a fundamental purpose of social security. Unemployment and sickness insurance benefits protect living standards, enable (re)training and skills development, allow for recuperation and rehabilitation, and improve job match when re-entering work. Social insurance benefits provide individual support, not means-tested and so not dependent on family circumstances.<\/p>\n

There is growing support for reviving these benefits, to expand individual financial protection and to support labour market dynamics. The Fabian Society\u00a0proposals<\/u><\/a>\u00a0would initially pay 50% of previous earnings for six months for unemployment and 80% for 12 months for sickness. They also propose similar insurance schemes for carers, for maternity and adoption, for parental leave, and for self-employment. The Resolution Foundation\u00a0scheme<\/u><\/a>\u00a0focuses on unemployment benefit and proposes payments at 65% of previous wages, up to a cap set by median earnings, and for a fixed period of three months.<\/p>\n

My preference would be for the longer time periods and wider coverage of the Fabian proposals. But either would be a start towards rebuilding social insurance as a main plank of social security.<\/p>\n

3. Reform Universal Credit<\/h4>\n

Universal Credit takes up a lot of space. It is a mass means-tested scheme for millions of households. It is where DWP investment in IT and digitalisation has been focused. It is a benefit assessment and payment system, a work-first employment service, and a debt collection agency. It holds most of the policy attention.<\/p>\n

The cost of living crisis and the extensive evidence of financial hardship has focused attention on the adequacy of Universal Credit. This has led to calls (from\u00a0JRF\/the Trussell Trust<\/u><\/a>\u00a0and from\u00a0Daniel Edmiston and colleagues<\/u><\/a>, among others) for immediate increases in Universal Credit rates. There are also calls (from\u00a0Bright Blue<\/u><\/a>\u00a0and from\u00a0IPPR<\/u><\/a>) for an independent review of benefit levels and adequacy.<\/p>\n

These are important measures. But it is not just the level of Universal Credit that causes difficulties and hardship for claimants, it also aspects of the design and implementation. The DWP rightly received\u00a0much praise<\/u><\/a>\u00a0for the way it dealt with the huge influx of claims during Covid-19. The reasons for that success included the stripping away of anything not related to the assessment and payment of benefit. The system needs to be directed back to delivering that core purpose.<\/p>\n

I draw my top issues for Universal Credit reform from areas that seem to cause the most problems:<\/p>\n