A Warning on the Effects of Welfare Reforms in Britain and Thoughts on How to Resist Them
Acorn is a community union; we represent and fight for our member’s interests. If the welfare reforms introduced by the British government had been good for people in our communities then we would support them. But our experience has been that they have been disastrously bad.
Welfare reforms were brought forward by several acts of Parliament during the Conservative-Liberal Democrat coalition government 2010–15, and by the Conservative government since 2015. The main objective given for these reforms was to cut the amount of money spent on welfare. The coalition government said that their changes would cut £21bn from the welfare bill but even the Institute for Fiscal Studies, a neoliberal think tank, admit that total government spending on welfare in real terms did not actually drop at all during those five years. Figures for the years since then provided by the official Office for Budget Responsibility show only a modest drop, equating to around 1% of the total welfare budget.
Despite the fact that they haven’t actually managed to reduce total spending on welfare, the amount paid out has reduced dramatically, with the impact being concentrated on the most vulnerable people in society. This is shown in research by the Equality and Human Rights Commission which calculates that benefit changes have translated into the bottom 70 percent of society having nearly £2,000 each cut from their household budget. The chart below taken from their report shows how the impact has fallen disproportionately on the poorest.
While the welfare reforms have failed to save the government money, the other justification that ministers repeatedly gave for their implementation was to get people into work. There are various mechanisms designed to do that built into the reforms, but basically what they boil down to is making it harder to claim benefits for being out of work. The next section of this report will detail the cruel consequences of these policies, but what is often missed is the terrible effect that this compulsion for people to take any job that is offered has on people who are working.
Basically the welfare reforms have made it impossible to fall back on benefits, so people are obliged to put up with terrible working conditions rather than risk unemployment. The welfare reforms have worked hand in hand with legislation limiting trade union power, public sector pay caps and redundancies, the rise of precarious employment and austerity reducing economic demand to cause the UK to experience the longest sustained drop in wages since the Napoleonic Wars. The scale of the pay squeeze in the UK is demonstrated in the following chart made by the Trade Union Congress:
The argument made for getting people into work and off benefits was made in cruel dehumanising language. Alongside a sustained campaign of government rhetoric, the tabloid press was full of stories of “benefit cheats” and “problem families with no experience of work.” There were also attacks on disabled people, which coincided with the government introducing outsourced work capability assessments run by staff with no medical training. These assessments are notoriously unfair, and there are hundreds of harrowing cases collated on the Calum’s List website. These include people being found fit for work while undergoing chemotherapy treatment for terminal cancer, people who have died the same day as the assessment with their relatives later receiving a fit for work notice in the post, as well as thousands of other injustices and humiliations. The assessments provide a perverse incentive for mentally and physically disabled people to prove their incapablity, and they are stress inducing, humiliating and counter-productive experiences. Even the government’s official figures show that over half of assessments that are appealed are found to have delivered incorrect verdicts.
The biggest lesson that we have learnt from our experience of welfare reform is that it is so important not to allow a narrative to develop where the interests of welfare claimants are set against those of workers. In the UK a toxic narrative of “strivers versus skivers” developed, which was very effective in selling policies which went against the material interests of many of those who supported them — sometimes even directly. As outlined above, making welfare more harsh and unreliable, in the euphemistic words of Ian Duncan Smith, the architect of welfare reform, “to make sure that you are always better off in work than on benefits”, means that British workers have individually and collectively been forced to accept worse and worse conditions. The Joseph Rowntree foundation now estimates that 1 in every 8 workers, some 3.8 million people, are now living in poverty. For the first time, over half the people in poverty are in working households, including 2.6 million children.
The transformation of social security into a system that relentlessly coerced people into employment started under the New Labour government’s Welfare to Work programme. The basic logic of both the New Labour reforms, and their subsequent strengthening by to Coalition and Conservative governments, is that claimants have to constantly prove that they are engaged in looking for work, applying for jobs, and taking any offer of employment they possibly can. Along the way they are forced to attend training days, engage in CV writing workshops and make increasingly frequent appointments at the Job Centre. The punishment for missing any of these is to be sanctioned, which means that one loses their rights to benefits, usually for 6 weeks at a time, even though benefits are only set at a subsistence level so stopping them basically means condemning people to destitution. In this period payday loan companies charging extortionate rates of interest have become a presence on British high streets with tragic results for people falling into impossible debts.
Job Centre staff for years reported that they were under increasing pressure to sanction claimants for the slightest misdemeanors, even if they were ill or had to care for a sick child. But the government always denied that there were targets for the overall level of sanctions. However, this lie was exposed when a whistleblower published a picture of a poster reprimanding staff for not hitting their sanction targets.
Welfare reform, alongside austerity has transformed Britain. The change is visible in the streets, where rough sleeping has gone from being an extreme occurrence to an everyday reminder of how close most of us are to the precipice. Official statistics show that 77,000 people are now classified as statutory homeless, while the numbers sleeping rough have risen by 169% since 2010. Even these shocking figures though do not capture the full scale of the problem; research by the housing charity Crisis suggests that 62% of homeless people do not show up in official statistics.
The rise of homelessness is inextricably linked to welfare reform, the roll out of “universal credit”, which is just one aspect of the reforms, leading to spikes in rent arrears averaging £420 per tenant according to a survey of housing associations. Even more stark is a recent news story showing a 70% rise in paupers funerals where the family of the deceased is unable to pay for the cost of burial.
The other phenomenon that is symptomatic of the way that welfare reform and austerity have collapsed Britain’s safety net is the emergence of food banks. These were practically unknown in Britain in 2009, but between then and 2018 the number of emergency food bank parcels distributed by the Trussell Trust had risen from the tens of thousands to over 1.3 million, with this number estimated to cover only around two thirds of total UK food banks. But food bank use represents only the tip of the iceberg when it comes to the rise food insecurity in the UK; a quarter of parents report skipping meals so as to have enough to feed their children. The National Health Service (NHS) reported in 2015 that cases of hospital admission due to malnutrition had risen by 50% since 2009.
The government even accidentally conducted a natural experiment of the effect of its welfare reforms by rolling out Universal Credit gradually by region. The Trussell Trust reported a 52% increase in people referred to food banks in areas where Universal Credit had been introduced. These facts are well known, although the government refuses to measure statistics on it, and it’s hard to avoid the conclusion that hunger is being used as a weapon to control poor people.
When defending their welfare reforms the government points to the fact that unemployment rates have declined to 4%. To some extent this is accounted for by the fact that getting Job Seekers allowance is now such a miserable process so that even if people are unemployed, they don’t bother. But it is true that numbers in employment are higher. However, while historically periods of low unemployment have coincided with rising wages as employers have to compete for scarce labour, in actual fact we have been going through a period of rising levels of in work poverty and wages that are still lower than they were ten years ago.
In conclusion, coercive welfare reforms push claimants into desperate situations, they design in insecurity as a way of incentivising people to take up work. This leads to terrible social problems in and of itself, but it also has a knock on effect reducing employers’ need to provide decent wages and conditions to keep hold of staff. The fact that despite taking away significant amount of money from claimants in the seven years since the programme of reforms were introduced, the overall cost of welfare has not significantly gone down is absolutely damning. It gives the lie to the idea that these reforms were ever about saving the government money; they were about taking away power from ordinary people.
Tin Hinson for Bristol Acorn. November 2018.
This report was written at the request of our comrades in Canada who are resisting their government’s attempt to implement similar welfare reforms. Best of luck resisting. Please share this with anyone that might find our experience useful.
Any questions or for other resources please email firstname.lastname@example.org. I had hoped to collate some personal testimonials in this report, but ran out of time. If that would be useful, please email me and I’ll try to get something sorted.