Since 1997 an extra three million jobs have been created in the British economy, more than 1.8 million of these jobs have been taken by immigrants. At the same time there are still 3.5 million claimants on the benefits system and 2.4 million claims for the job seekers allowance each year. The welfare systems of the Western capitalist economies began has a noble attempt to provide a safety net for the disposed but it is becoming increasingly clear that the Byzantine social security systems have engendered a culture of dependency and irresponsibility amongst the West’s underclass.
The problem is not a lack of employment opportunities. Eastern European workers have come to do jobs that were shunned by Britain’s unemployed. The Eastern Europeans have managed to find employment even though many don’t speak the language and are sometimes overqualified. Many are middle-aged and support families back home or in the UK. They don’t ‘undercut’ British workers because Britain has a generous minimum wage and in any case the wages are higher than any state benefits. Similarly if you go to your local supermarket you will see cashiers who are over retirement age; they continue to work because they want to. If retirees and foreigners can find employment in Britain then there is no excuse for Britons of working age to be out of employment and living on benefits.
For some it is simply a case that they would simply rather pick up their benefits than work a 35 hour week. Others are trapped by the vicious cycle of depression, despondency, dependency and a lack of confidence. A few are addicted to alcohol or hard drugs. All cases represent untold tales of wasted talent and potential. A system that offers no way to break out and maintains the status quo is one that harms both the unemployed and the society that supports them.
The general consensus is that Tony Blair bottled the chance to implement radical reform of the welfare system in 1997 and instead opted for the safer but ultimately ineffective New Deal at a cost of over £60 billion over ten years. At the same time in America Bill Clinton pursued a more radical reform of America’s welfare system including the hiring private companies to help train and educate the long term unemployed. Public-private partnerships have helped to radically reduce long term unemployment in the parts of America where they have been trialed.
Today there are entire estates in British cities where welfare dependency has become a way of life and for too many there is no incentive to work. For example for some single mothers it is more profitable to earn a living from benefits than it is in the work place. The key principles of the Beveridge report were that welfare systems should not stifle incentives to work, opportunity and a sense of responsibility amongst the poorest sectors of society. It is clear that far from providing a safety net for the dispossesed, the benefits system has actually helped to create a glass ceiling that has trapped the poorest people in Britain. There are at least 60 neighbourhoods in Britain where more than 50% of adults are on benefits and not in employment; in some areas over 75% of adults claim unemployment benefit. More than 80% of families on unemployment benefit do not have a single family member that is actively searching for work. There are also over 100,000 drug addicts and alcoholics on full incapacity benefits as a result of their addictions. This means that the Government is handing them taxpayers’ money to fund their drug abuse. Where is the sense in that?
For some drugs addiction and mental illness prevent employment, for the vast majority though there is no excuse. If an 80 year old man can find work stacking shelves or a middle-aged Polish woman without a word of English can find a job then so can any able-bodied British man or woman. All the major parties have recently announced plans to radically reform the welfare system; this will benefit both society as a whole and those that are caught in the welfare trap. In my view they don’t go far enough.
As well as training the unemployable and the skill-less and curing the addicts we should also be promoting responsibility, opportunity and the incentive to work. At the moment there is too much incentive not to work. I don’t claim to fully understand Milton Friedman’s ideas about negative income tax for the poor but why doesn’t the Government provide extra benefits for those poor families that do find employment rather than throwing all its cash at those that contribute nothing to the state? At least that way there is a financial incentive to bet back to (or start) work. Why not also make community service mandatory for the long term unemployed? Not only will this provide an incentive to work, (claimants are no longer getting something for nothing) but it may also engender a sense of social responsibility. We can but live in hope.
Oh and finally on the subject, I highly recommend this programme. Watch the preview clip; it says it all!