FT Austerity Audit: Welfare changes challenge ingrained ideas

A food bank opens in a wealthy Buckinghamshire town; in hard-hit Blackpool, the local authority switchboard is besieged after thousands of the town’s poorest receive council tax bills for the first time.

The biggest wave of welfare changes for a generation is breaking on to a largely unprepared nation. As it does so it is upending certainties, creating new support structures – and challenging ingrained notions of the role and reach of the welfare state.

Politicians are obsessed with the squeezed middle. But those affected by this welfare shake-up are members of another group altogether: the squeezed bottom, one might be tempted to call them, were it not for the Carry On connotations.

For the first time since the welfare state was created in the afterglow of wartime egalitarianism, the government has chosen, as an act of policy, to make the poorest 10 per cent poorer. Behind this lies a mixture of pragmatism and high moral purpose.

First, the pragmatism. Over the past 30 years, and largely unremarked, the share of public spending consumed by health and social security has risen from a third to a half. What was sustainable in a time of plenty requires revision in an era of austerity.

For Iain Duncan Smith, welfare secretary, the moral dimension looms equally large. A job, he believes, can reconnect an impoverished underclass to a civil society from which many feel detached.

Yet the clients of this new welfare state are by no means uniformly the shiftless poor of popular imagination. The Joseph Rowntree Foundation points out that 6.1m people classified as living in poverty are in working households – exceeding by a million the members of this group in workless homes.

For many, notions of work or worklessness are surprisingly fungible as they drift from one to the other in a precarious labour market. About one in six economically active Britons has claimed unemployment benefit at least once in the past two years; half escape it within three months.

It is easy to exaggerate the radicalism of the changes now in train. Britain has not become America: this is a pruning, rather than a root and branch overhaul, of benefit entitlements.

The reforms nevertheless offer an unprecedented challenge to what in some parts of the country has become a way of life. One northern council official confided that, among the thousands to whom he had explained the changes, only one had ventured that perhaps in that case she should think about looking for a job. Denial or defiance had been the stock response.

Notions of entitlement and obligation, the deserving and the undeserving poor, jostle uneasily in middle class psyches.

For the most part, the nation appears to be on the government’s side. Unpublished research from Ipsos Mori shows seven out of 10 in the prewar generation are proud of the welfare state. This falls to one in four among those born in the 1980s and 1990s. With the passing of the cohort whose collectivist ideals found expression in this model of social security, will support for it gradually fade away, along with a willingness to pay the taxes to sustain it?

The outcome of the reforms remains uncertain. Councils fear that, like medieval indigents seeking alms and shelter behind the castle walls, the hordes may descend when the money runs out. Mass civil disobedience remains a possibility; those newly liable for council tax may refuse to pay it.

Are we going backwards to an era when the state was too small to offer protection to the homeless or food for hungry families; or forward into a fiscally continent future in which the relationship between citizen and state will be healthily redefined? Out there, in town halls and jobcentres, that question will be answered. The resolve and value system of better off Britons may increasingly be tested.