Social Security and Welfare Reform

'Dynamic Benefits': A Response from NPI

  • Published 1st Mar 2010
  • Category: Social Security and Welfare Reform

Dynamic Benefits: towards welfare that works was published by the Centre for Social Justice in September 2009. That it is the result of a serious investigation into a subject of great importance is clear from even a cursory reading. At first sight too, the ideas on which its based – that the benefit system needs to be simpler and fairer in order to reduce dependency and support positive behaviour – are hard to disagree with. So should the report’s proposals be supported, either as a whole or in part? And what are the reservations?

This note represents a response to the report which emerged from a workshop held by the New Policy Institute in February 2010, involving people from organisations with now long experience of how the current benefit system works. Its purpose is to stimulate a discussion around the report. What is written here is our interpretation of what emerged: none of the views expressed here therefore should be attributed to anyone else.

In what follows, the note is divided into sections each containing one or blocks of questions and the response to it. The questions themselves and the pre-amble to them are drawn from a note circulated in advance of the workshop to help stimulate thinking.

Key points:

  • By taking a binary view of the system in terms of just the state and the recipient, the report overlooks the ways that other players will react to, and exploit, the system. At least some of the present complexity is there to try to prevent this happening.
  • The replacement of the diverse array of means-tested benefits by just two credits certainly simplifies the present arrangements. By contrast, the incorporation of both needs-based (e.g. DLA) and contributed-based benefits (e.g. JSA-C) into the same system does not. The effective abolition of these latter two kinds of benefits also raises issues of both principle and politics.
  • The level at which benefits are set is an intensely political decision – and a final view on the proposals cannot be made without knowing what those levels are. Trying to implement a system with a cost of several billion attached to it at a time of cuts invites haphazard, piecemeal adoption only – and a lower level of benefits too.