In a scene from The Spirit of ’45, a 2013 documentary about the achievements of the 1945-51 Labour government in Britain, film director Ken Loach told the story of a mother and two of her sick children. Having only enough money to pay for medicine to help one of her children to recover, the mother was faced with a serious dilemma. Loach showed that the emergence of the welfare state removed, at a stroke, similar dilemma’s faced by millions of families throughout the UK.
Atlee’s golden age
The welfare state emerged on the basis of recommendations contained in a 1942 report authored by Liberal civil servant, Sir William Beveridge. Six years later, Clement Atlee’s post-war Labour government formally abolished the Poor Law replacing it with a universally free at the point of delivery health care system.
On the same day the government also introduced a flat rate insurance based contribution system to ensure that workers were protected by the state in the event of unemployment or sickness. This supplemented already existing maternity grants, retirement pensions, family allowances, death grants and child benefits.
The reforms went far wider. The Attlee government introduced acts of parliament that resulted in a programme of mass house building and the provision of free secondary education for all. On July 5, 1948, the welfare state including the NHS that substantially improved the lives (and the life chances) of millions of ordinary people, was born.
Atlee’s reforms have been in stark contrast to the ideology of governments’ from the Thatcher administration onward. Over the last four decades, genuine progressive reforms have been steadily whittled away to be replaced by “modernising welfare changes” – euphemisms for privatisation, cuts to services and the retrenchment of benefits.
The dismantling of the welfare state
The plans for dismantling and privatising the state were laid down by Margaret Thatcher’s 1982 cabinet papers, “the longer term options”, released under the 30 year rule in 2012. The implementation of these plans were accelerated under the 1996 Blair government, whose evoking of the ‘spirit of ’45’ was used as a cover for his embrace of austerity and the party’s retreat from universal benefits.
The period following the election of the Con-Dem coalition government in 2010 saw the most severe assault on the welfare state since its foundation. This began with Chancellor George Osborne’s Comprehensive Spending Review which cut £80 billion from public sector spending – £18 billion of which came from welfare. In June 2013 a further £11.5 billion was cut, including £2.6 billion from local authority budgets.
The coalition’s Open Public Services Programme is intended to open up all public services (other than the court system and the security services) to competition from “any qualified provider” – including the NHS. The passing into law of the 2012 Health and Social Care Act, effectively marked the potential death knell of the NHS and Atlee’s welfare state. The outsourcing of services since 2012, in other words, has become the current Tory governments default position.
Author Richard Humphries pointed out that significant cuts to social care, local authority budgets and increasingly restrictive eligibility criteria for services, are leaving millions of people without the support they need. Moreover, cuts to disability benefits, the introduction of a sanctions regime, the imposition of the bedroom tax and the reduction in council tax benefits, have culminated in rising levels of poverty (including child poverty), homelessness and suicides.
A price worth paying?
The above is viewed by the Tory government as a price worth paying as part of a neoliberal offensive to roll back the state by redirecting capital expenditure to outsourced private providers funded through PFI mechanisms. The Conservative governments under-funding of the NHS, reconfigured for propaganda purposes as NHS Trust overspending, is a defunding strategy that has resulted in the deterioration of service delivery. This has then been used by the state as a pretext for more privatisations.
Retrenchment of the welfare state, including cuts to benefits, means that the financial assistance the poor, sick and unemployed are legitimately entitled to is, in many cases, being denied them. These groups are, instead, being coerced into unsuitable jobs or disciplined as part of the governments punitive sanctions regime.
The neoliberal vision
Theresa May’s vision for the country is to return to the less eligibility principle of the Poor Law, by ensuring that the alternative to working is so awful that the poor will accept any jobs and conditions. Faced with government cuts on the one hand, and rising demand on the other, the response of local councils throughout the UK has been to ration services. The result is that many people who would previously have received services are now simply refused them or are directed towards voluntary sector organisations, such as Citizens Advice Bureaus or food banks.
Since the 2008 financial crash, all successive UK governments have exploited the crisis. But even before the crash, large parts of the welfare state had already been transformed by neoliberal policies. Whether the welfare state can be saved from the rapaciousness of unbridled neoliberal capitalism depends on the extent to which public apoplexy is sufficiently channeled into democratic socialist alternatives.
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