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Welfare Reform on the Web (February 2001): Welfare State - UK

BUILDING LONG-TERM PROSPERITY FOR ALL: PRE-BUDGET REPORT NOVEMBER 2000

Treasury

London: TSO, 2000 (Cm 4917)

From a social policy point of view, the basic state pension is to rise by £5.00 a week for single people and £8.00 a week for couples in 2001, and by £3.00 and £4.80 a week in 2002. The Winter fuel allowance for the elderly will go up by £50.00 to £200. The minimum income guarantee for the poorest pensioners will go up to £92.15 in 2001, to £100 by 2003 and then in line with earnings. A new pensioners tax credit is promised for single people on less than £135.00 a week and couples on less than £200. On education, an additional £200m from windfall tax receipts will be used for repairing schools, with £4000-£7000 for each primary school and £10,000-£30,000 for each secondary school this year. Also promised about five million families a £520.00 a year tax cut in the next budget, to replace the married couples allowance, and extended the New Deal jobs programme to lone parents not in receipt of income support.

(See also Independent, Nov 9th 2000, p.16-21; Daily Telegraph, Nov 9th 2000, p.8-10; Guardian, Nov 9th 2000, p.15-22; Financial Times, Nov 9th 2000, p.5-13).

COMMUNITY, UTOPIA AND NEW LABOUR

R. Levitas

Local Economy, vol.15, 2000, p.188-197

HOW I WILL CUT PUBLIC SPENDING TO PROVIDE MONEY FOR LOWER TAXES

M. Portillo

Independent Review, Dec 5th 2000, p.4

Proposes saving public money through:

  • a crack down on benefit fraud;
  • replacing the New Deal with a cheaper scheme under which private contractors would be paid to find jobs for unemployed people;
  • accelerating the transfer of council house stock to housing associations;
  • withdrawing benefits from unemployed people who refuse work.

(See also Financial Times, Dec 6th 2000, p.25).

HOW LONG WILL THE YOUNG BE WILLING TO PAY FOR THE OLD?

H. McRae

Independent Review Supplement, Nov 30th 2000, p.4

Argues that, as the population ages, maintaining adequate state retirement pensions, social security benefits and health services will place an intolerable taxation burden on younger working people.

LABOUR BOASTS OF SPENDING UPSURGE

P. Wintour

Guardian, Nov 23rd 2000, p.13

Tony Blair has conceded that lack of state investment is the root cause of Britain's inadequate public services. Has announced plans to double capital investment in public services to £18bn a year by 2003-04. This includes £1.4bn extra capital spending on the NHS over three years and £1.6bn for repairs to school buildings.

(See also Independent, Nov 23rd 2000, p.4; Financial Times, Nov 23rd 2000, p.4; Daily Telegraph, Nov 23rd 2000, p.33).

MONITORING POVERTY AND SOCIAL EXCLUSION 2000

M. Rahman et al

York: Joseph Rountree Foundation, 2000

Report finds that Britain's poorest families still face deep inequalities in income, job prospects and health despite government attempts to improve standards of living for the least well-off. Analysed 50 indicators of poverty and found that of 49 indicators compared year-on-year, 17 had improved, 23 were the same and nine had worsened. There were still 2 million children in workless households, although this was 20% lower than in 1994. Although total youth unemployment was down, it was still nearly twice the national average, with half a million people aged 18 to 24 out of work. Numbers of people on very low incomes, defined as 40% of average incomes, had risen by 1.5 million over the previous three years.

A NICE WARM FEELING, GORDON. IT'S A PITY BRITAIN'S STILL A SLUM

P. Toynbee

Guardian, Nov. 9th 2000, p.26

Public services in Britain, including health and education, are collapsing due to lack of investment. The Chancellor is unable to spend the estimated £15bn of spare money in his coffers on improving them for fear of triggering inflation. At the same time, the petrol tax revolt suggests that taxation is at the limit citizens will tolerate.

OUR COUNTRYSIDE: THE FUTURE

Department of the Environment, Transport and the Regions and Ministry of Agriculture, Fisheries and Food

London: TSO, 2000 (Cm 4909)

Proposes setting a Rural Service Standard, establishing minimum levels of provision for health, childcare, post offices and transport. There will be an annual independent audit of whether this standard is being met. There will be a renewed presumption against the closure of rural schools, and they must be connected to the Internet by 2002. GP services are to be improved by the provision of £100m for new mobile units (vans) or primary health care centres in 100 communities. Some 3,000 affordable homes are to be built in villages and a total of 9,000 new affordable homes a year provided as a result of a doubling of funding to the Housing Corporation by 2003-04.

PORTILLO PLEDGES TAX CUTS TO HELP HARD-UP PARENTS

R. Watson and P. Webster

Times, Dec. 6th 2000, p.6

The Tories are promising to cut taxes by £8bn while spending more on health and education. Labour reply that the savings identified by the Tories to fund their promised tax cuts are bogus. They could therefore only deliver through massive cuts in spending on public services.

(See also Financial Times, Dec. 6th 2000, p.3; Independent, Dec. 6th 2000, p.6; Daily Telegraph, Dec. 6th 2000, p.12).

THE POST OFFICE AND THE FUTURE OF THE NETWORK

Trade and Industry Committee

London: TSO, 2000 (House of Commons papers. Session 1999/2000; HC 724)

Report expresses concern about the feasibility of government plans to turn the Post Office into a Universal Bank for the poor. Notes that it would not be cost effective for the Post Office to run a bank just for the poor, while the retail banks do not want a large number of their customers switching to the new universal Post Office bank. Nor do they want the rate of take-up of basic accounts to swamp their systems with unprofitable business. The conflict of interest is complicated by government insistence that the retail banks finance the annual running cost of the Universal Bank, which the Post Office has estimated at £150m. Report also points out that the speed at which cash dispensers are being installed in Post Offices is disappointing.

 

POST OFFICE IN TALKS TO SAVE UNIVERSAL BANK

D. Cameron

Financial Times, Nov. 29th 2000, p.3

The Post Office is in talks to revive its Universal Bank plan by seeking financial support from smaller mortgage and online banks and utility companies as well as the five main retail banks. It is also seeking to sign up a technology partner to provide a technical infrastructure for the bank that would enable the provision of online banking services.

PRIVATE FINANCE COMES UP SHORT

P. Robinson

Financial Times, Nov. 29th 2000, p.27

The government has failed to increase capital spending on the public service infrastructure (school buildings, hospitals, transport, etc). This undershoot may be in part due to the impact of the Private Finance Initiative. The PFI process has often been drawn out and many schemes are delayed coming to fruition. At the same time conventional spending on public assets is delayed in the expectation of the successful completion of PFI contracts.

QUEEN'S SPEECH

N. Timmins

Financial Times, Dec. 7th 2000, p.7

From the welfare reform point of view announces a Social Security Fraud Bill that will give investigators powers to inspect bank, building society, credit agency and tax records where there is suspicion of benefit fraud. It will also introduce a "two strikes and you're out" penalty where anyone convicted of benefit fraud twice in three years will lose entitlement to state help. A wide-ranging Health and Social Care Bill will:

(See also Guardian, Dec. 7th 2000, p.12; Independent, Dec. 7th 2000, p.7; Times, Dec. 7th 2000, p.12 + 15; Daily Telegraph, Dec. 7th 2000, p.5).

ROLLING BACK THE STATE'S ROLE: WHO IS RESPONSIBLE?

A. Bell

British Journal of Health Care Management, vol.6, 2000, p.532-533

Examines recent shifts in the positions of both the Labour and the Conservative Party with regard to pensions, long-term care of the elderly and the balance of private and public health funding. The government plans to limit the state's role in supporting the incomes of older people, while also limiting its role in providing for the costs of long-term illness. At the same time the Conservative Party is championing the expansion of private healthcare.