Beveridge Report

Beveridge Report


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The Second World War helped to create a remarkable unity among the British people. Most people felt that the only way to defeat Nazi Germany was to stand firmly together. The unity was most clearly expressed in their readiness to accept the war sacrifices imposed by Winston Churchill and his coalition government. Between 1940 and 1945 the British government contained members of all three major political groupings: the Conservative Party, Labour Party and the Liberal Party.

There was a strong feeling that the British people should be rewarded for their sacrifice and resolution. To encourage the British people to continue their fight against the axis powers, the government promised reforms that would create a more equal society. The first of these was the 1944 Education Act. This measure raised the school leaving age to 15 and provided free secondary education for all children.

The British government also asked Sir William Beveridge to write a report on the best ways of helping people on low incomes. In December 1942 Beveridge published a report that proposed that all people of working age should pay a weekly contribution. In return, benefits would be paid to people who were sick, unemployed, retired or widowed. Beveridge argued that this system would provide a minimum standard of living "below which no one should be allowed to fall". These measures were eventually introduced by the Labour Government that was elected in 1945.

Sir William Beveridge, a member of the Liberal Party, was elected to the House of Commons in 1944. The following year the new Labour Government began the process of implementing Beveridge's proposals that provided the basis of the modern welfare state.

They underestimated their Beveridge. With only a small staff to help him, he produced one of the greatest and most revolutionary documents in our social history. He certainly was not guilty of underselling his achievement. When he produced his report a little over a year later, he said modestly to me: This is the greatest advance in our history. There can be no turning back. From now on Beveridge is not the name of a man; it is the name of a way of life and not only for Britain, but for the whole civilized world.'

He had presented his detractors with a highly embarrassing, forward-looking report, rapidly accepted as a blueprint for post-war Britain. It was seized on in Parliament. He became, for the first time, not a Whitehall expert, but a national figure, in some way the harbinger of the kind of postwar world people wanted to see. Public opinion forced the adoption of his report by Parliament.

Beveridge was an administrative genius, probably without parallel in this century. Set him a problem - food rationing in the First World War; the call-up and fuel rationing in the Second World War - and he would retire to a small room and produce an answer. But as a practical administrator he was a disaster, because of his arrogance and rudeness to those appointed to work with him and his total inability to delegate. The few research assistants, including the present writer, who stayed with him, biting the bullet, found him inspiring and constructive in research, impossible in personal relations.

The Beveridge scheme of social security is still under debate. The government has already proposed the adoption of the greater part of it but a Labour amendment in the House of Commons demanding the adoption of the scheme in its entirety received as many as 117 votes have spoken of the Beveridge scheme in earlier news commentaries and don't want to detail its provisions again I merely mention the debate now taking place in order to emphasise two things. One is, that whatever else goes through, family allowances are certain to be adopted though it is not yet certain on what scale. The other is that the principle of social insurance has come to stay and even the most reactionary thinkers in Great Britain would now hardly dare to oppose this. The Beveridge scheme may ultimately be adopted in the somewhat mutilated form, but it is something of an achievement even to be debating such a thing in the middle of a desperate war in which we are still fighting for survival.

The House of Commons has said its say. It has not precisely rejected the Beveridge Report - indeed, so far as words go, it gave it a kind of welcome. It has not even quite killed the Report. It has done something different. It has filleted it. It has taken out the backbone and the bony structure. It has added up the portions that are left - and assured us that they amount to 70%. Sixteen portions out of twenty-three by the Herbert Morrison reckoning - and the only proviso attached is that none of these portions is quite definitely and finally guaranteed. The opponents of the Report - from Sir John Anderson all the way down to Sir Herbert Williams - spoke as though the basis of the Report were an attempt to cadge money off the rich on behalf of the not entirely deserving poor.

Yes. They might be willing to give something. They recognized the justice of the claim. But not all that was asked. And certainly not now. And, above all, they could not make promises for the future. Sir Arnold Gridley wondered "how want is to be defined. Can it necessarily be met by any specific monetary sum? The family of a hard-working and thrifty man can live without want, perhaps on £3 a week, whereas the family of a man who misuses his money or spends it on drink or gambling, may be very hard put to it if his wages are £5 or £6 a week."

The fear that small children or old age pensioners may take to drink or gambling is a very real one to large sections of the Conservative Party.

Sir lan Fraser congratulated the Chancellor on having "done a most difficult thing". He had called the House back "from the fancy fairyland in which it loves to indulge, to reality, and thereby rendered a great service to us all." Further on in his speech Sir LAN carried misrepresentation to the pitch of mania. Objecting to Sir William's plan to make insurance compulsory and national, so as to cut the cost of collection to a fraction, he declared that Sir William's object in doing this was "to steal a capital asset so as to get some revenue for his scheme".

Finally, Sir Herbert Williams let out of his own private bag the largest cat released on the floor of the House of Commons since Baldwin explained why he had to fight the 1935 election on a lie. He did it with the words "If the scheme is postponed until six months after the termination of hostilities the then House of Commons will reject it by a very large majority." Exactly. If we don't get the foundations of a new Britain laid while the war is on, we shall never get them laid at all. Sir Herbert Williams and others of the same kind - or nearly the same kind - will see to that. For so huge an indiscretion the Conservative Party should un-knight Sir Herbert instantly.

These snivelling objections are quoted for one purpose only: to show the low level at which the opponents of the Report chose to conduct the battle. They fought it on the Poor Law level, the three halfpenny, ninepence-for-fourpence, Kingsley Wood and Means Test level. The common people of this country were asking for more than their directors and controllers chose to give them. They could get back where they belonged, and say thank-you the mercies were no smaller.

The Beveridge Plan was given so much publicity for the sole purpose of demonstrating to the world Great Britain's claim to leadership in the social sphere. In Europe there has been nothing but laughter at this attempt. It now transpires that the whole Beveridge humbug has feet of clay. The wine of enthusiasm of the British leftists has been watered down by insurance experts, doctors, pensioned officers and big businessmen. Nothing will remain of the comprehensive social scheme but the ensuring of a State grant for the veterinary treatment of cats and dogs.

Beveridge Day. I spent most of it in the House and watched the revolt grow. The Whips are ill-informed, insensitive to opinion and rumour: and the much-abused Margesson is now missed . Herbert Morrison wound up for the Government in a balanced, clever, eloquent speech which revealed his increasing Conservatism - was it a bid for the future leadership of a Coalition Government? The crowded House listened with interest and even the more truculent Socialists, whilst later prepared to vote against their leaders, were too cowardly to attack Morrison.

In December 1942, Sir William Beveridge was the master of University College, Oxford. After a successful career in the civil service, he had been made director of the London School of Economics, remaining there from 1919 to 1937, when he moved to Oxford. His concern with social problems had been lifelong, from his early days as a Toynbee Hall social worker and a protégé of Sidney and Beatrice Webb around 1905, to his appointment in 1934 as chairman of a government committee on unemployment insurance. During the first weeks of the war, in an article published in The Times he had called for a full-scale planning of the wartime economy, and his convictions had been strengthened by what he had seen since 1940 - in his role as temporary civil servant in the Ministry of Labour - of the failure to organize manpower as he felt it should be organized.

The opportunity which would lead Beveridge to much more than instant fame had been presented to him inconspicuously enough, back in May 1941, with his appointment as chairman of an interdepartmental committee, its brief being to prepare "a survey of the existing schemes of social insurance and allied services, including workmen's compensation, and to make recommendations". An innocent enough way of keeping a body of senior officials occupied, it would appear; yet from this modest cocoon would emerge a plan to establish full security for all British citizens 'from the cradle to the grave', and lay practical foundations for the postwar welfare state. This was the renowned Beveridge Report.

Its author's assets for drafting the report were an immense capacity for hard work, strong convictions and a thorough knowledge of his immensely complex subject. He was also, within the limits set by his character, a skilful political

manipulator whose experience of Whitehall from the inside, understanding of politicians, and shrewd evaluation of the effect of popular opinion and of press support in putting his work across, would stand him in good stead. A serious obstacle in his way, however, lay in a certain aspect of his character. He had now been in positions of authority for over twenty years and his urbane assurance of his own superiority, turning rapidly to irritation were he in any way challenged, alienated many of those whose backing he most needed. Indeed the hostility which his manner provoked might well have destroyed the effect of all his valuable work, but for extreme good fortune in the matter of timing.


Want, disease, ignorance, squalor and idleness: are Beveridge’s five evils back?

T his November marks the 75th anniversary of the Beveridge report – the founding document of the modern welfare state and the answer to the question: what would Clement Attlee do? The Attlee government’s radical agenda, after all, basically enacted every recommendation made by eccentric patrician liberal reformer Sir William Beveridge, who exceeded his simple brief – to survey the country’s social insurance programmes – with a wide range of suggestions aimed at eradicating what he called the five “giant evils”: want, disease, ignorance, squalor and idleness.

Whatever Attlee thought of him, Beveridge was no socialist. He thought taking the burden of healthcare and pension costs away from corporations and individuals and giving them to the government would increase the competitiveness of British industry while producing healthier, wealthier, more motivated and more productive workers keen to buy British goods.

And he was right. The sustained post-second-world-war period of economic growth and near full employment that lasted until the late 70s saw falling poverty, slum clearance, the founding of a free health service and education system alongside rising real incomes and falling inequality – which, in turn, led to higher tax revenues and helped the UK pay off its war debts. In 1950, Seebohm Rowntree – who had surveyed poverty in York in 1899 and 1936 – concluded that the problem had largely been erased.

Seventy-five years on, however, the good work done by the Beveridge Report is in grave danger of being entirely undone. The “five giants” are creeping back into the mainstream of our daily life. As they do, our productivity crashes through the floor. Full-year figures for 2015 show the UK’s productivity gap with other countries standing at its worst since modern records began. What would Beveridge find if he were to report today?


Annette Beveridge

In October 1872 she sailed for British India. Around 1875 she was involved in a public controversy with Keshub Chandra Sen, an Indian philosopher and social reformer who attempted to incorporate Christian theology within the framework of Hindu thought. Akroyd was shocked by her discussions with him and felt that Sen, who spoke up for women's education in England, was a typical Hindu obscurantist back home in India, trying to keep knowledge from the minds of women. [4] This dispute spilled into the native press and had its impact on the Bethune School. Akroyd was also dismayed with Sen's associates such as Bijoy Krishna Goswami, Aghore Nath Gupta and Gour Govinda Ray, who were traditionally Hindu in educational background and resisted the education of women.

"Mr. Sen had a strong prejudice against university education, in fact, against what is generally regarded as high education, of women. He objected to teaching them, for instance, such subjects as Mathematics, Philosophy and Science, whereas the advanced party positively wanted to give their daughters and sisters what is generally regarded as high education. They did not object to their university education and were not disposed to make much difference in point of education between men and women. There was no hope of compromise between two such extreme schools of thought, Accordingly, the radical party proceeded to start a separate female school of their own, called the Hindu Mahila Vidyalaya for the education of the adult young ladies belonging to their party. The successful manner in which they carried on the work of this school under Miss Akroyd, subsequently Mrs. Beveridge, attracted much public notice and was highly praised by the officers of Government. This school did excellent work for many years and was subsequently conducted under the name of the Banga Mahila Vidyalaya and was at last amalgamated with the Bethune College for ladies, to which it furnished some of its most distinguished students." [5]

Annette Beveridge translated the diaries of the first Mughal Emperor Babur, the Baburnama, publishing it in four books from 1912 to 1922. She used both Persian and Turki sources. [6] [7]

She also translated the biography of the second Mughal Emperor, Humayun, from Persian into English. The memoir had been written by his sister Gulbadan Begum, whom Beveridge affectionately called "Princess Rosebud". [8] [9] Her other translated works include The key of the hearts of beginners, 1908.

The couple had two children: a daughter, Annette Jeanie Beveridge (d. 1956), who went up to Somerville College, Oxford in 1899 and married R. H. Tawney, [11] and a son, William Beveridge (1879–1963), a noted economist who gave his name to the report associated with the foundation of the welfare state. [12]


The Beveridge Report and the foundations of the Welfare State

Frontispiece of the Beveridge Report, 1942. Catalogue reference: PREM 4/89/2

‘Now, when the war is abolishing landmarks of every kind, is the opportunity for using experience in a clear field. A revolutionary moment in the world’s history is a time for revolutions, not for patching.’

This was Sir William Beveridge’s clarion call to Parliament to establish a comprehensive system of social insurance for Britain’s population in his report Social Insurance and Allied Services, better known as the Beveridge Report, which was presented to Parliament on 24 November 1942 and has its 75th anniversary this year.

The Five Great Evils

The Beveridge Report, to quote Conservative Chancellor Kingsley Wood, is ‘lengthy’ 1 , a detailed survey of the state of welfare in Britain and its suggested future direction.

At the heart of the report was Beveridge’s decree that future action to improve social insurance, steps on the road of ‘social progress’, should not be hindered by any ‘sectional interests’ – instead government should work to abolish the ‘Five Great Evils’ which plagued society: Want, Disease, Ignorance, Squalor and Idleness. 2 .

The Treasury, at the time of the Report‘s writing, characterised these ‘Evils’ as possessing an ‘increasing order of strength and ferocity’ and Beveridge agreed, saying that Want was in some ways the easiest of these giants to attack. Indeed – while his report raised the prospects of education reforms to combat Ignorance, the wave of post-war council housing which would do so much to combat Squalor, and the prospect of a full employment economy doing away with Idleness – the Report set itself out merely as the first step down the road of ‘social progress’ to a society free of these evils.

At the heart of Beveridge’s plan to rid Britain of Want and its companions was a comprehensive system of social insurance and welfare: universal benefits so that families would never ‘lack the means of healthy subsistence’ for lack of work or income. Beveridge tasked the state with establishing a ‘national minimum’, a safety net below which no one could fall. Central to his plan was a contributory system which would entitle the population to maternity, child and unemployment benefits, state pensions and funeral allowances. Underpinning all of this would be a free at the point-of-use universal health care system, to care for the nation’s health regardless of personal circumstances.

Pre-war poverty

People in Britain, of course, faced incredible privations and hardship during the Second World War as Beveridge was writing his report – rationing, air raids, a national contribution to the giant war effort – but Beveridge’s Report was also written to ensure that the dreadful poverty many in Britain experienced in the economically depressed decades between the First and Second World Wars never returned.

Documents within The National Archives give us a sense of the levels of poverty people faced during this period.

In 1936, three years before the war, the Unemployment Assistance Board commissioned the Pilgrim Trust to make an enquiry into the affects of long term unemployment on people. The descriptions of the lives of those living in poverty, found in The National Archives record AST 7/255, are harrowing.

Figures from the The Pilgrim Trust Enquiry into long term unemployment, 1936-1938, examining instances of ‘pyscho-neurosis’ in long term unemployed people. Catalogye reference: AST 7/255

The report, based on interviews with the unemployed in several different towns, gives an insight into the weekly cycle of impoverished life, centred around the day when unemployment assistance is doled out – of one or two proper meals a week followed by only tea and bread, trips back and forth to the pawn shop – a cycle where, ‘there are not a few pennies left over at the end of the week, but a few pennies short’. It includes descriptions of families of four or five people living in one dirty room surrounded by ‘filthy linen and an indescribably horrible smell’. There are details of the physical and mental affects of chronic unemployment – malnourished men and women, men rendered ‘listless’ and depressed by their enforced idleness. It was against this background that Beveridge made his recommendations.

Cabinet worries

Despite the obvious need for an overhaul of social security to prevent such hardship recurring, the transformative scope of Beveridge’s report and the political and economic commitments its adoption would entail still came as a surprise to the Cabinet – particularly Winston Churchill and his closest Conservative ministers, who had misgivings about the feasibility of Beveridge’s proposed schemes.

Churchill received a copy of the report on 11 November 1942, but was no doubt quite busy conducting the war, so instructed the chancellor Kingsley Wood to ‘have an immediate preliminary, brief report made on this for me’. He soon received Wood’s ‘critical observations’, as well as comments from his close friend and adviser Lord Cherwell.

These two reports sum up the initial reception Beveridge’s ideas received from the Prime Minster’s inner circle. Wood described the plan as ‘ambitious’, but worried it involved ‘an impracticable financial commitment’. Wood said that ‘the abolition of want’ was an admirable objective that would have ‘a vast popular appeal’, but he was concerned that Beveridge’s plan was ‘based on fallacious reasoning’.

Wood also raised a number of concerns about the push-back from various industries impacted by the Report‘s recommendations. Would doctors consent to be state employees ? What would the reaction of industrial assurance societies be when the state took their role? How would employers feel about having to make contributions for the unemployed? He was also concerned about the universal, non-means-tested nature of Beveridge’s proposed benefits, drily commenting that:

‘The weekly progress of the millionaire to the post office for his old age pension would have an element of farce for the fact that the pension is provided in large measure by the general taxpayer.’

Wood, as well as Cherwell, also raised concerns about how the United States (who were by and large bankrolling Britain’s war efforts at this point) would react to such bold proposals for state provision by a country brought so financially low by an all-consuming war. Cherwell pointed out that the US population might take umbrage at financing the creation of a far more generous welfare state than their own. Wood worried that it would appear that Britain was ‘engaged in dividing out the spoils while they [the US] are assuming the main burden of the war’.

Concluding, Wood expresses the cautious attitude the Report initially provoked, commenting:

‘Many in this country have persuaded themselves that the cessation of hostilities will mark the opening of a Golden Age: (many were so persuaded last time also). However this may be, the time for declaring a dividend on the profits of the Golden Age is the time when those profits have been realised in fact, not merely in imagination.’ 3

“Once it is out he can bark to his heart’s content” – Winston Churchill’s minute on whether Beveridge should be allowed to speak on his report. Catalogue reference: PREM 4/89/2

As a result of this caution, there was much concern around the publicity the report would receive, and particularly around Beveridge himself speaking on it and promoting its ideas. Even before the report was published there were leaks to the press about its contents, and members of Cabinet worried that Beveridge’s allies were laying the ground work to ensure their friend’s ideas could not be ignored. ‘Beveridge’s friends are playing politics’, the Conservative Minister for Information, Brendan Bracken, wrote to Churchill in October 1942, ‘and when the report arrives there will be an immense ballyhoo about the importance of implementing the recommendations without delay’.

To try and avoid this, Cabinet resolved that Beveridge was to be prohibited from speaking about his Report, or his ideas, before or on the day of its presentation to Parliament, and perhaps after. Beveridge protested, saying he must be allowed to speak on his work. Churchill relented, saying that after the report had been officially published Beveridge could ‘bark to his heart’s content’ about it. 4

Beveridge’s stock with the government declined with the release of his report. On 30 January 1943 Beveridge wrote to Churchill asking whether he might meet with him, to discuss his future role in government and also social security. Beveridge’s letter is one of effusive praise: he informed the Prime Minister that, while on their recent honeymoon, his wife and he had both read Churchill’s biography of his ancestor the 1st Duke of Marlborough. Beveridge informed Churchill that the book should be ‘compulsory reading for statesmen of all lands … I have noted a least a dozen prognostic passages they ought to learn by heart’.

However, Beveridge had to wait over a fortnight for a reply from Churchill and when it came it expressed the Prime Minister’s coolness to the man whose report had put him in a difficult political position. ‘I hope an opportunity for a talk with you will occur in the future’, Churchill wrote to Beveridge, ‘but of course I have to give my main attention to war’.

Winston Churchill declines Beveridge’s request for a meeting, 16 February 1943. Catalogue reference: PREM 4/89/2

The public’s reaction

But while the Beveridge Report might have been viewed with a sceptical caution by members of government, the views of the British public were another thing entirely, and were decisive in ensuring that so much of Beveridge’s vision for Britain was enacted.

Government public opinion surveys and monitoring from the December 1942 (when the report was made available to the public) onwards show just how favourable the reaction was, and just how sceptical some were that it would ever come to pass.

The British Institute for Public Opinion carried out a country-wide survey on the Report immediately after its general publication. The findings were stark: 95% had heard about the Report and the vast majority of the population approved of its recommendations and thought they should be put in effect, particularly the scheme for a comprehensive state medical service. However, while people though Beveridge’s plan should happen, the poll found few who thought it would happen.

‘The Beveridge Report and the Public’ survey. Catalogue reference: PREM 4/89/2

During this period the Ministry of Information produced weekly ‘Home Intelligence Reports’ for government and these also show just how well the Report was received by Britons. In one week in December 1942, for instance, the postal censor examined 947 letters that had been sent about the Beveridge Report, almost all favourable. One writer remarked that the plan would give, ‘the boys who are fighting something to look forward to’, while another remarked that the Report‘s recommendations would bring about a ‘complete social revolution … without bloodshed’. 5

Ministry of Information Home Intelligence Report, 10 December 1942. Catalogue reference: INF 1/292

Indeed, according to the 10 December report (just days after the Report was made available) Beveridge’s plan was the most talked about topic in the country. A few weeks later people were said to be looking forward to bedding down during the Christmas break to really make a study of it. But this positive reaction seems to have been tinged with scepticism and some anger. The reports note that many people thought that big business would ‘kill’ the report, while another postal censor found a letter predicting ‘serious trouble in this country after the war’ if the report was not adopted. 6

Legacy

In the face of this reaction the government was pragmatic, reserving its scepticism but making an announcement to Parliament that it would consider the Report and was committed to improving social insurance, but would not make any particular commitments at the present time. Reaction from opposition MPs and the public, again recorded in various public opinion intelligence reports, brought the government back to Parliament again, this time making more explicit declarations of their intent to carry out Beveridge’s plan as far as possible.

National Health Service Leaflet, 1948. Catalogue reference: INF 2/66

In the end, both the Labour and Conservative parties made adopting a comprehensive system of medical care and social insurance a part of their platform in the 1945 General Election. Clement Attlee’s Labour Party entered government after the election, and continued the work of the wartime government to set up the National Health Service, established in 1948 – perhaps one of the most enduring parts of Beveridge’s realised vision, which itself celebrates its 70th anniversary next year.

The Beveridge Report was conceived in the crucible of war, a bold plan for a nation which had sacrificed so much. Seventy-five years on, we can still see the effects of the ‘bloodless revolution’ it began.


Britsh History 1955-1994

Origin: In the 1945 general elections Labour won a landslide victory over the standing conservative government led by Sir Winston Churchill. With an overall majority in Parliament there was the new government started carrying out its reform programme.The British public believed that a Labour government would be more likely to achieve a social reform. Labour's reforms were based on the Beveridge Report so it began by tackling the five giants identified in the Beveridge Report.

1. Want :
Poverty was seen as the key social problem which affected all others. National Insurance Act was passed which provided comprehensive insurance against most eventualities. It provided sickness and unemployment benefit, retirement pension and widow and maternity benefit. It was said that social provision was made for citizens from the 'cradle to the grave', catering for their needs from their time of birth to their death.

2. Disease:
In 1946 the National Health Service Act was passed which saw the introduction to a new heath service (The NHS). British citizen could receive medical, dental and optical services free of charge. Treatment by GPs and in hospitals was free also. These benefits were free at point of use, no patient being asked to pay for any treatment.

3. Squalor: Most of Britain still had slum areas especially in London. The overcrowding was a serious problem made worse during the Blitz. To deal with the problem of squalor the government concentrated on building decent homes for the working class after the war.

4. ignorance: In 1944 the war time Coalition government passed the Education act. The act was passed the Labour government but originally a Conservative government idea. The act said that secondary education shouuld become compulsory until the age of 15 years with pupils to be provided meals and medical services at every school.

5. idleness: After the war, Britain gradually rebuilt itself. The Labour Government succeeded in maintaining high levels of employment after the war. Job vacances became more readily avalible by 1946, unemployment was reduced to 2.5 %. Despite post-war problems such as shortages of raw materials and massive war debts to pay off. One way in which the government kept almost full employment was through nationalisation.


1. The Inter-departmental Committee on Social Insurance and Allied Services were appointed in June, 1941, by the Minister without Portfolio, then responsible for the consideration of reconstruction problems. The terms of reference required the Committee “to undertake, with special reference to the inter-relation of the schemes, a survey of the existing national schemes of social insurance and allied services, including workmen’s compensation and to make recommendations.” The first duty of the Committee was to survey, the second to recommend. For the reasons stated below in-paragraph 40 the duty of recommendation was confined later to the Chairman of the Committee.

The Committee’s Survey And Its Results

2. The schemes of social insurance and allied services which the Inter-departmental Committee have been called on to survey have grown piece-meal. Apart from the Poor Law, which dates from the time of Elizabeth, the schemes surveyed are the product of the last 45 years beginning with the Workmen’s Compensation Act, 1897. That Act, applying in the first instance to a limited number of occupations, was made general in 1906. Compulsory health insurance began in 1912. Unemployment insurance began for a few industries in 1912 and was made general in 1920. The first Pensions Act, giving non-contributory pensions subject to a means test at the age of 70, was passed in 1908. In 1925 came the Act which started contributory pensions for old age, for widows and for orphans. Unemployment insurance, after a troubled history, was put on a fresh basis by the Unemployment Act of 1934, which set up at the same time a new national service of Unemployment Assistance. Meantime, the local machinery for relief of destitution, after having been exhaustively examined by the Royal Commission of 1905-1909, has been changed both by the new treatment of unemployment and in many other ways, including a transfer of the responsibilities of the Boards of Guardians to Local Authorities. Separate provision for special types of disability — such as blindness- — has been made from time to time. Together with this growth of social insurance and impinging on it at many points have gone developments of medical treatment, particularly in hospitals and other institutions developments of services devoted to the welfare of children, in school and before it and a vast growth of voluntary provision for death and other contingencies, made by persons of the insured classes through Industrial Life Offices, Friendly Societies and Trade Unions.

In all this change and development, each problem has been dealt with separately with little or no reference to allied problems. The first task of the Committee has been to attempt for the first time a comprehensive survey of the whole field of social insurance and allied services to show just what provision is now made and how it is made for many different forms of need. The results of this survey are set out in Appendix B describing social insurance and the allied services as they exist today in Britain. The picture presented is impressive in two ways. First, it shows that provision for most of the many varieties of need through interruption of earnings and other causes that may arise in modern industrial communities has already been made in Britain on a scale not surpassed and hardly rivalled in any other country of the world. In one respect only of the first importance, namely limitation of medical service^ both in the range of treatment which is provided as of right and in respect of the classes of persons for whom it is provided, does Britain’s achieve­ment fall seriously short of what has been accomplished elsewhere it falls short also in its provision for cash benefit for maternity and funerals and through the defects of its system for workmen’s compensation. In all other fields British provision for security, in adequacy of amount and in compre­hensiveness, will stand comparison with that of any other country few countries will stand comparison with Britain. Second, social insurance and /the allied services, as they exist today, are conducted by a complex of disconnected administrative organs, proceeding on different principles, doing invaluable service but at a cost in money and trouble and anomalous treatment of identical problems for which there is no justification. In a system of social security better on the whole than can be found in almost any other country there are serious deficiencies which call for remedy.

Thus limitation of compulsory insurance to persons under contract of service and below a certain remuneration if engaged on non-manual work is a serious gap. Many persons working on their own account are poorer and more in need of State insurance than employees the remuneration limit for non-manual employees is arbitrary and takes no account of family responsibility. There is, again, no real difference between the income needs of persons who are sick and those who are unemployed, but they get different rates of benefit involving different contribution conditions and with | meaningless distinctions between persons of different ages. An adult insured man with a wife and two children receives 38/- per week should he become unemployed if after some weeks of unemployment he becomes sick and not available for work, his insurance income falls to 18/-. On the other hand a youth of 17 obtains 9/- when he is unemployed, but should he become sick his insurance income rises to 12/- per week. There are, to take another example, three different means tests for non-contributory pensions, for supplementary pensions and for public assistance, with a fourth test—for unemployment assistance—differing from that for supplementary pensions in some particulars.

Many other such examples could be given they are the natural result of the way in which social security has grown in Britain. It is not open to question that, by closer co-ordination, the existing social services could be made at once more beneficial and more intelligible to those whom they serve and more economical in their administration.


The Beveridge Report: Making the Welfare State

Britain&rsquos welfare state is often spoken of as a triumph of peacetime, however, Beveridge's plan for it was drawn while the world was at war. Politicians were united on the need to change the system of social care but divided on how to make it work and how much of the Beveridge Report to put into practice.

In February 1943 as a result a further committee was formed to look in detail at implementing the recommendations of the report (the Sheepshanks Committee) in April.

The Conservative Party supported aspects of the report. Churchill, the leader of the Conservative Party, coined the phrase 'from the Cradle to the Grave' in a radio broadcast in March 1943 to describe the need for some form of social insurance to give security to every class of citizen in the state. However, Churchill was against too much state intervention and supported &lsquofreedom of choice&rsquo in healthcare.

The Liberal Party supported the Beveridge Report, including the inclusion of voluntary groups and charities in providing social security.

The Labour Party agreed with the main recommendations of the Beveridge Report but thought the State should provide full benefits and free healthcare for all and exclude voluntary societies.

The 1945 General Election

After World War Two, a general election was immediately called as the wartime coalition government of the major parties (Labour, Conservative and National Government) split apart. The General Election took place on 5 July 1945. The results were not all counted until 26 July due to the need to collect votes from the enormous number of men and women in the armed services, which were stationed across the world.

At the centre of the Labour Party Manifesto for the 1945 election is the implementation of the report&rsquos recommendations around national insurance and health. Key Labour politicians had also run some of the most relevant domestic departments during the war, such as Ernest Bevin Minister of Labour and National Service.

Labour Victory

The 1945 election led to a Labour Party victory and they had over 100 MPs more than any other party. The new Labour government introduced the steps for the National Health Service (NHS) and the implementation of other areas identified within the Beveridge Report, such as national insurance.

The inclusion or use of voluntary and &lsquofriendly societies&rsquo was not included in practical enactment of report by the Labour Government. All functions were controlled by the State.

The three decades following 1945 are known as a time of post-War consensus: an agreement by the main political parties that the Beveridge welfare state and a mixed economy would best keep inequality in check and stop poverty.

The National Health Service

Even before the election, parts of the Beveridge Report were being put into place by the coalition wartime government. The Labour Government introduced the laws and infrastructure needed for social security and the National Health Service (NHS):

  • 1944 Education Act (wartime coalition)
  • 1945 Family Allowances Act
  • 1946 National Insurance Act and National Health Services Act
  • 1946 USA 50 year loan to UK of $3.75 Billion
  • 5 July 1948 National Health Service established

Glossary

National Insurance - a universal (i.e. everyone pays the same amount of their salary) system of social insurance paid by the state with contributions made by employers and employees from their pay.

Welfare State - describes a system of state support funded by contributions from people and businesses. This system is sometimes called social security.


Beveridge and After: the Implementation of the Report’s Proposals

15The wholehearted endorsement of the Beveridge Report by the Labour Party – and the initial reluctance of Winston Churchill to commit the government to what appeared a very costly programme in the middle of a very expensive war – helped to secure an overwhelming Labour victory in the election of�. Following this triumph, legislation to implement Beveridge Report was put in place. Two of the three ‘assumptions’ had already been addressed: legislation to introduce tax-funded family allowances had been passed before the election and an official White Paper on Full Employment had been published shortly before Beveridge’s book on the subject. The Labour government took immediate steps to establish a National Health Service and new legislation to introduce the Beveridge’s social insurance scheme was passed in�, supplemented in� by the introduction of National Assistance – a measure that effectively centralised future means-tested social assistance, previously administered at local level. Contemporaries (not least Beveridge himself) understood the need for means-tests to be transitory these were destined, like the Marxist state, to wither away. However, central consolidation of means-tested assistance was to prove prescient for the future development of British social security.

16From the outset, the report’s recommendations encountered practical difficulties. Universal subsistence-level benefits proved particularly problematic for two main reasons: their overall expense and the difficulty in establishing a level of subsistence in a country where the cost of living (notably housing costs) varied considerably. From the start, the Beveridge Plan was viewed as potentially expensive in terms of its impact on industrial costs and thus on post-war exports and economic recovery. Its author was forced into early detailed recalculations to demonstrate how future financial burdens might be kept within limits. Three main problem areas had been identified in the report itself. First, rents varied considerably by family size, social class and by geographic location, [26] thereby challenging the principle of a flat rate subsistence-level benefit for all claimants. Second, the introduction of the first state pension at subsistence level and conditional on retirement [27] posed a particularly heavy burden that threatened the balances of the new insurance fund. Numbers of elderly were rising and, with old age poverty already a pressing concern, [28] the wartime government had already come under pressure to raise pensions. Finally, while the non-contributing housewife added to the scheme’s overall expense, the plight of deserted or divorced wives required attention. The report offered its own solutions: housewives should be admitted to all benefits bar unemployment benefit by virtue of their husbands’ contributions – including the divorced and deserted. The problem of variable rent could not be allowed to upset the principle of a flat-rate benefit for all, but those living with high accommodation costs might be permitted to appeal for supplementation. Finally the pensions issue (the most sensitive and difficult) might be tackled by phasing in the subsistence level pension over a㺔-year period, to allow insurance contributions to accumulate and post-war economic growth to lessen the burden. In the interim, lower pensions would encourage older workers to postpone retirement and/or encourage personal savings. Beveridge argued with some cogency that, whereas sickness or unemployment might strike without warning, old age was less a risk than a stage in the lifecycle for which the working person should be expected to plan.

17The author’s analysis cut little ice with the official committee set up to inspect the Beveridge Report on behalf of the wartime Cabinet (Phillips Committee). This committee, in view of the substantial extension in state-run insurance envisaged by Beveridge, criticised his report on a number of moral and economic grounds. It would pamper the feckless because it abandoned the principle of deterrence on which social relief in Britain had long been based. Phillips also attacked the principle of subsistence as unaffordable and impractical in light of the variation in the cost of living around the country. [29] Such criticisms were later embellished by the Treasury, which argued that most of the proposed changes were unnecessary, threatened the future balance of payments (as insurance contributions would create higher prices for exported goods), undermined work incentives and penalised entrepreneurship by perpetuating high taxation. [30] Moreover, contributions were unlikely to sustain benefit expenditure over the long run. Benefits for divorced wives in particular were interpreted as "subsidising sin." [31] As the National Council for Women was demanding a regular allowance for all housewives (a proposal the report rejected), Beveridge found himself isolated between organisations demanding more benefits for women and the Treasury demanding fewer. In consequence, the bulk of proposals to help women were eradicated. [32] Treasury objections underpinned the cuts in level and duration of benefit that appeared in subsequent white papers on social security that laid down the wartime government’s proposals for reform. [33] While the idea of unifying and rationalising social security administration was accepted, Whitehall officials and the Conservative Party looked askance at the implications of the Beveridge Report for future tax burdens and the damage inflicted on work incentives.

18Thus considerable inroads had been made by into Beveridge’s proposals well before the general election of�. However, the results of that election – which gave Labour its first ever absolute majority in the House of Commons – reflected the evident popularity of the Beveridge Report and the new government set about its implementation without delay. However, there were real problems. First, it proved impossible to balance the books: subsistence level benefits could not be funded by flat-rate contributions at a level that low-paid workers could sustain. The alternative, to raise the industrial contribution, threatened the post-war export drive. Second, the variation in the cost of living (largely due to rents) made a uniform subsistence level benefit incapable of a clear definition. Third, the cost of living index on which official calculations were based failed to account for either wartime or post-war inflation with any accuracy. Finally, although Beveridge had recommended that subsistence-level pensions should be phased in over a twenty-year period, the new Labour government found it quite impossible to leave established provision for pensioners untouched. Bowing to popular demand, the government decided to introduce the new pensions immediately (in�), while encouraging pensioners to stay in work by not offsetting additional earnings (post-war labour shortages were chronic). [34] However, although old age pensions were introduced at more generous rates than family allowances (arguably on the grounds that old people voted but children did not, as The Times remarked), the elderly proved particularly vulnerable to inflation. Social insurance benefit rates remained unindexed and were only reviewed every five years price rises in the later�s corroded state pension values. This meant that one of Beveridge’s most popular promises – the abolition of means testing – was never realised as many poorer pensioners were forced to claim social assistance.

19The National Assistance Board (NAB), created in� to replace pre-war local authority means-tested assistance, was originally intended by Beveridge to cater only for a tiny remnant of cases. Although levels of poverty fell in the aftermath of the war, the work of the NAB remained substantial. By�, 500.000 pensioners were still applying for means-tested help and by the early�s, this figure topped one million. In the early�s, investigations by the London School of Economics revealed the high levels of poverty that persisted among the elderly, many too proud to apply to the NAB and to submit to the indignity of the means test. [35] In the absence of index-linked insurance benefits and with an ageing population, this figure continued to grow: today, state social security in Britain is overwhelmingly reliant on means tests. Viewed in the long run, we are forced to conclude that the nineteenth century poor law has made a deeper impact on British social policy than the Beveridge Report ever did.

20In the more immediate term, however, the popularity of Labour’s welfare measures guaranteed their survival. During and after the� elections, the reformist wing of the incoming Conservative government overcame earlier resistance to allow the NHS and the principle of universal benefits to survive intact. However, by the later�s, arguments against universality were being revived. The objections heard in wartime Whitehall, detailed above, concerning the damage universal benefits imposed by undermining work incentives, sustaining ‘unrealistic’ wages and raising industrial costs – all began to command a wider audience. Burdening the public sector by paying benefits to those who did not strictly need state support was a waste of resources. Hence the situation began to change: memories of the�s had faded, full employment and the spread of private welfare systems (notably for pensions) guaranteed that the level of state benefits was becoming irrelevant to anyone but the very poor. Slowly, traditional assumptions about the role of the state in supporting the indigent re-emerged, thus setting the stage for their full-bodied resuscitation with the election of Mrs Thatcher in�. The traditional tenets of British political economy about the minimal role of the state in supporting the indigent had, in spite of Beveridge’s best efforts, never really gone away.


The battle for Beveridge’s welfare state

Enthusiastic crowds queued to buy Beveridge's plan for a welfare state. How would a modern-day Beveridge restore the standing of his creaking creation?

William Beveridge discusses his report at the Ministry of Information. Photo: AP/Rex/Shutterstocks

On 30th November, 75 years ago, in the middle of the Second World War, an anticipatory queue formed on London’s Kingsway, the then headquarters of Her Majesty’s Stationery Office.

Barely a fortnight earlier, Winston Churchill had ordered that the church bells be rung in recognition of Montgomery’s victory at El Alamein. It was the first domestic cause for rejoicing after three years of a war where there had been nothing to celebrate aside from the retreat from Dunkirk, the Battle of Britain, and stoic defiance of the Blitz. It was El Alamein—the first victory—that brought forth Churchill’s famous declaration that “Now is not the end. It is not even the beginning of the end. But it is perhaps the end of the beginning.”

The lengthening queue on Kingsway, however, was not focused on the end of anything they were after a new beginning. They were there for the somewhat unlikely purpose of buying an often-immensely technical 300-page government-commissioned report, written by a retired civil servant, with the uninspiring title “Social Insurance and Allied Services.”

Much of the report was as hard going as the title suggests. But its 20-page introduction and 20-page summary, which were sold as a cheaper cut-down version, punchily dug the foundations on which the post-war welfare state would rest. These parts of the report were stuffed with inspirational rhetoric—“five giants on the road to reconstruction,” “a revolutionary moment in the world’s history is a time for revolutions, not for patching”: language that no government report, on any subject, has rivalled since.

In the context of the welfare state today, after seven years of austerity and with more to come, it is pretty hard to imagine news about anything other than cuts. The NHS is in the midst of the biggest squeeze in its history. Social care is in crisis. Spending per pupil is due to stop rising, and to fall in real terms. And entitlements to working age benefits—having been cut—are due to be cut again. Even back in the New Labour years, when the government was mobilising serious resources to make work pay and avoid the poorest families falling behind, there was almost an element of embarrassment about the endeavour. Certainly, nobody queued down Kingsway, Whitehall or anywhere else to hear about Gordon Brown’s tax credits, which were expressly designed to disguise a poverty-reduction programme as tax cuts, the calculation being that the war on want would be unpopular and so must be waged with stealth. Compared to 1942, it is another world.

Source: Institute for Fiscal Studies

The author of the report that caused such a stir 75 years ago was William Beveridge, an egotistical 63-year-old who already had more careers behind him than most ever enjoy—not just in Whitehall, but also as a journalist, broadcaster, permanent secretary, and head of both the LSE and University College, Oxford. He seemed to switch opinions almost as often as he did jobs. At times he held distinctly free-market views, but advocated for dirigiste planning during both world wars. He sometimes spoke in generous terms about social welfare, but at others of the economic necessity of “the whip of starvation.” Just four years before his report, Beatrice Webb, the great Fabian reformer, recorded his view in her diary after a walk across the Hampshire downs, that “the only remedy for unemployment is lower wages… he admitted, almost defiantly, that he was not personally concerned with the condition of the common people.” And he had something of the crank about him. The young Harold Wilson, for a time Beveridge’s researcher, recalled having in the 1930s to talk him out of a theory that it was the “sunspot” cycle—solar eruptions which supposedly bore on crop yields—that chiefly explained unemployment.

When he was appointed, it must thus have been tough to know how his report would turn out. In 1942, however, he was to prove admirably clear about what he wanted to do. His report did indeed offer—as was trumpeted on publication day by newspapers as diverse as the Daily Telegraph and the Daily Mirror—“cradle to grave” social security. It really did promise a clean break with the hardships not just of the war, but with the pre-war past. And the British welfare state that it set out in blueprint is, for all the challenges that it faces, still with us today.

Beveridge’s core aim was to tackle the poverty that had so scarred the 1930s, though he dubbed poverty “Want.” The 1930s were the days of mass unemployment, the Jarrow march, and the deeply loathed household means test that could see a family lose benefit if a child got a paper round. He proposed to solve that by building a new system of social insurance that would support a vastly improved benefit system.

But “Want,” he declared—and he was fond of both lists and giant capital letters—was but one of the “five giant evils on the road to reconstruction.” The others being “Disease, which often causes that Want… upon Ignorance which no democracy can afford among its citizens, upon Squalor… and upon Idleness which destroys wealth and corrupts men.”

And to make his new system of social security work, he wrote in “three assumptions”—things that had to happen, outside of his report, to allow it to happen. Specifically, there would be a national health service, available to all and without a charge of any kind. That there would be children’s allowances, which we would now recognise roughly as child benefit. These were to be funded from general taxation, not the national insurance contributions that underpinned the rest of his system. And there would be “full use of the powers of the state to maintain employment and reduce unemployment.”

So there it was. A comprehensively new social security system, involving everything from maternity to funeral grants. A free-at -the-point-of-use NHS. An attack upon Ignorance—better education. An assault upon Squalor—replacing slum housing. And a policy of full employment. A pretty much all-encompassing vision, which pretty well came to pass.

Outside the Treasury, where the chancellor Kingsley Wood did his damndest to kill it off, the reception was rapturous. Even Churchill in some moods favoured the vision, though at other times he fretted over the costs. As a result, some planning was done, but none of it was actually to happen—other than Butler’s great 1944 Education Act—until after the war was won. But the political power of the Beveridge promise was nonetheless extraordinary. In HMSO folklore, nothing outsold Beveridge’s 600,000 copies until the Denning report, on the more obviously sexy subject of the Profumo scandal 20 years later. The BBC broadcast details of “The Beveridge Plan” round the clock in 22 languages, and summaries were dropped into Nazi-occupied Europe. A commentary found in Hitler’s bunker after the war declared it to be “no botch-up… and superior to the current German social insurance in almost all points.”

In the words of José Harris, Beveridge’s brilliant biographer, the report’s spectacular impact was “a matter of both luck and calculation.” The luck included the fact that it landed just after El Alamein. The calculation was the way Beveridge and his allies had trailed it, long before the days of spin doctors, and, of course the Bunyan-esque prose with which he painted his vision—Beveridge was, after all, originally a journalist.

For all the daring, there was continuity as well as change in the report. The Beveridge system can be traced to the first Edwardian moves towards social insurance—in which Beveridge had had a hand—and to assorted municipal experiments, from the communal healthcare in Aneurin Bevan’s Wales to the bold council housing schemes of Herbert Morrison’s London County Council. But while all these models and many other ideas had been swirling around well before the war, it was Beveridge’s report, in the wonderful phrase of Paul Addison, that provided “the prince’s kiss.” The one that gave them life. He distilled the spirit of the lot.

Here is not the place to tell the tale of how Beveridge’s vision of a modern welfare state was constructed nor the struggles that have followed over the succeeding 75 years, in which it steadily expanded to take up a much larger slice of a far bigger economy (see chart opposite). All of that is covered in my newly-updated book, The Five Giants. What I want to do here instead is to ask what on earth the Beveridge of 1942 would have made of the welfare state as it stands, 75 years on.

It is not an easy question to answer with any precision, as so much has changed that he simply could not have foreseen. When he reported, the worry was not about an ageing population, but a declining one, and in his view it fell to “housewives as mothers” to put this right through their “vital work… in ensuring the adequate continuance of the British race.” Women may have been pouring into factories and flying unarmed Spitfires in the emergency of war, but expectations were still shaped by the pre-war world, where only one married woman in eight had worked. Thus, for married women, “provision should be made… with reference to the seven [the seven who did not work] rather than the one.” So married women gained less benefit in their own right than men.

Gender is only the start. In 1942 the school leaving age was 14, and a vanishingly small proportion, just 3 per cent, of 18 year olds went on to university. Income tax rates were high. But only the decidedly better off paid any income tax at all. Britain still had a global Empire, but it had neither a remotely global economy nor any significant Commonwealth immigration. The closest thing Britain had to a computer was being operated in secret by Alan Turing, the BBC’s fledgling television service had been suspended for the war, and relatively few homes had a telephone. We were much younger: with fewer than 200,000 people aged over 85, against 1.5m today. And we were much poorer, with average inflation-adjusted income per head around a quarter of today’s figure. And so on and so on.

But with all that said, Beveridge would recognise and be proud of the National Health Service, which, a few charges in England aside, fits his ideal, although he would be amazed at its size. He believed that the costs would fall once a mighty backlog of treatment had been dealt with. Instead, as in every other developed country, expenditure on endlessly-evolving modern medicine has risen faster than the economy. But healthcare, the overwhelming bulk of it still coming through the NHS, now consumes around one pound in 10 of our much enlarged national income. He would be much less happy about the condition of its Cinderella sister, social care. The 1945 Labour government claimed to have “abolished the Poor Law.” But its shadow lives on in the way social care remains first “needs tested”—a certain level of disability is needed to qualify—and then means-tested. If Beveridge was around today, cracking that and integrating this neglected service with health would be a target.

He would recognise and broadly approve of the basic state pension, although he would have been decidedly cross at the way its value was allowed to sink for 30 years after Thatcher broke the earnings link in 1980. He would, however, endorse the cross-party way in which over the last decade—via the Turner Commission, Labour legislation, coalition implementation, and, so far, Conservative preservation—it has been rebuilt as what he originally intended: a near-universal minimum platform on which private saving can be constructed. Auto-enrolment into pensions wasn’t even an idea back in 1942. But this form of personal provision on top of that from the state would decidedly appeal to this liberal statesman.

Beveridge would approve, at least in principle, of welfare-to-work programmes. His report recommended that men and women “unemployed for a certain period”—six months in periods of average unemployment, longer when it was higher—“should be required as a condition of continued benefit to attend a work or training centre… to prevent habituation to idleness and as a means of improving capacity for earning.” Those recommendations were not implemented in the days of full employment after the war. They seemed unnecessary. It was to take until the later 1990s, and in a much changed labour market, for welfare-to-work properly to take off.

He would, however, be mortified that, 75 years on, we still haven’t solved what he dubbed “the problem of rent.” He devoted nine pages to it while acknowledging that the solution he proposed was inadequate. He would be appalled at the way rising private sector rents have turned what is now housing benefit into the equivalent of running up a down escalator—the bill rises remorselessly even as the quality of accommodation covered descends—in a housing market that the Conservative communities secretary Sajid Javid has candidly described as “broken.” And he would, of course, have been horrified that seven years of austerity have seen the return of food banks, the modernised equivalent of the old soup kitchens—75 years after his plan to abolish Want.

Unemployed men queuing at a labour exchange, October 1931. Photo: Daily Herald Archive/SSPL/Getty Images

But when it comes to the way Want is remedied today, Beveridge would be bemused at how far means-testing—through tax credits, housing benefit, and now universal credit—now extend up the income scale. This has been one of the most enormous changes since his time, occurring over the 1990s and 2000s as the emphasis on the benefits system shifted from supporting people on condition they did not work, to supporting them to be in work, a response to the way globalisation was driving down wages at the lower end. With his knowledge of the 1930s, he hated means tests on similar grounds to Frank Field who has repeatedly argued that they “promote idleness, encourage dishonesty and penalise savings.”

But it is the flipside of all the means-testing that would have alarmed him the most—a spectacular erosion of the contributory principle, which had been the rock on which Beveridge built his plan. “Benefit in return for contributions, rather than free allowances from the State, is what the people of Britain desire,” Beveridge declared. Today, National Insurance is still collected on a vast scale—it is the government’s second largest source of revenue after income tax. But the basic state pension aside—and even there the link is diluted—the connection between contributions paid and benefits received has come close to disappearing. Since the 1990s, insurance-based unemployment benefits have only been paid for six months, after which the means-test bites more recently, other insurance-based benefits have been similarly curtailed. All of that would have met with Beveridge’s stern disapproval.

So there are as many negatives as positives on our brief and selective score card that we have presumptuously filled out on behalf of the Beveridge of 1942. But then the welfare state never was—or never should have been—something handed down on tablets of 1940s stone, never to be tampered with. It has, inevitably, had to adapt to the changing world. And there have been big advances as well as setbacks down the years.

There is, for example, now a huge range of benefits for disabled people never envisaged in the 1940s. There has been the massive expansion in schooling and—notwithstanding the tuition fees row—a mighty explosion in higher education. Having spent next to nothing on early years and childcare 20 years ago, the UK has today one of the highest levels of spend in Europe. In the 1940s, and for decades afterwards, the great worry was the elderly poor today, while there are still some poor pensioners, the elderly are the social group least likely to be at the bottom of the income distribution, a remarkable story of progress.

While the welfare state is under all sorts of financial stresses and strains, even after austerity it takes roughly two-thirds of government expenditure, and around a quarter of national income, just as it has since the 1980s. The composition of that spending has changed—parts have shrunk (free teeth and specs, for example) or even vanished. But new limbs have been added, and the beast is still alive. The prognosis for it in the coming 75 years, however, will depend on the argument for it continuing to adapt in changing times. The most pressing question for its survival is not what the 1942 Beveridge would think about this or that aspect of today’s welfare state, but how a modern-day Beveridge might set about restoring the system’s popular appeal.

In the era of ration-books and emergency wartime taxes, Britain became more equal, which made the “all in it together” spirit required to build the welfare state that bit easier to achieve. But over more recent decades inequality has widened hugely again. Inheritance has begun to bear more heavily upon an individual’s life chances, in ways that would have stunned and troubled Beveridge—he would, reasonably, have assumed it would continue to become less important, as it had already been doing for decades by 1942. Even in the egalitarian 1950s, the truly comprehensive social insurance system Beveridge desired was never quite achieved. It would be a much more difficult sell in a world where the poor struggle to pay the premiums, and the rich feel they don’t need the cover.

Would he even try? The one area in which he might is social care, where patchy and inadequate provision is fuelling the fear of financial ruin. Here a cry for the pooling of risk across society might, if put with flair, still be popular.

A modern-day Beveridge would be intrigued by the argument that because automation will soon destroy jobs on such a scale, it is time to set the welfare state on entirely new principles, by offering everyone a so-called universal “citizen’s “ or “basic” income. But with his “something-for-something” understanding of popular morality, he’d be unlikely to regard a free-for-all stipend as a way to entrench legitimacy. And he would be quick to spot that such a policy would be a decidedly costly stretch, requiring stiff levels of taxation—for which there is absolutely no evidence that the British electorate would vote.

As a wordsmith, Beveridge would be acutely sensitive to the role of language in charting a course through all the modern-day challenges. Although widely seen as the founder of the modern “welfare state,” he in fact refused to use the term, disliking its “Santa Claus” connotations. He would today be even more dismayed by some of the language around it, and the effect on policy. “Social security”—Beveridge’s great goal—has fallen out of the lexicon. Politicians of all parties now talk about “welfare,” and quite often deliberately conflate everything from the contribution-based pension (by far the largest single element of the £212bn bill), to child benefit, in-work benefits, and means-tested help for the workless, with the latter, at most, accounting a sixth of the bill. The meaning of the word “welfare” has been turned on its head. It has little to do with faring well. Rather, it has become a term of abuse. To be “on welfare” is to be on the wrong side of the tracks or on “benefit street.” One thing those politicians who truly believe that “we are all in this together” could do is reclaim the language of “social security” and the sense of collectiveness that goes with it.

One of the many modern problems which was not a challenge in the 1940s is inter-generational inequality. Even to the extent that it was, it was the old and not the young that were the worry. But in the gap that today yawns between the generations in the opposite direction, a modern-day Beveridge might spot an opportunity—to re-emphasise something the welfare state has always done, which is redistribute not just from rich to poor but across the individual, and family, lifecycle.

The welfare state continues to educate and support its children, as it always has. Having seen them through birth and the early health interventions that are crucial for their future, it seeks to pick up the minority in their middle years for whom life goes wrong in myriad ways. And when these people—and their more-fortunate peers—are older, it tries to ensure they have a basic state pension: having provided, on the way, incentives and assistance to help those who can build something better than that. And it assumes that those older people, and their children, and their grandchildren, will repeat the enterprise—because the older generations fret as much about the younger generations, as the younger generations do about their parents and grandparents. Whether the question is health or housing, education, employment or poverty relief, the welfare state does all this far from perfectly, and occasionally very badly. But most individuals and families would, surely, still prefer for their own lives to unfold in a world where the welfare state was there at moments of vulnerability, rather than live in the alternative—a world where everyone is for themselves, for good, or ill, or very ill.

A modern-day Beveridge would thus likely aim to foster understanding of the welfare state’s continuing role as an unwritten inter-generational contract. By doing that, he just might be able to encourage taxpayers’ willingness to stump up the funds that the system continues to need.

For the single thing that Beveridge would be crystal clear about is that if the British people, to use his repeated phrase, still want in very changed circumstances a decent system of social security and a wider set of “allied services”—the NHS, education, decent housing for all—then they have to be prepared to advocate, fight, vote and pay for it. My favourite single quote from Beveridge is this. “Freedom from Want cannot be forced on a democracy or given to a democracy. It must be won by them.” As true now as it was then—when people were queuing up for it.

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Nicholas Timmins is a senior fellow at the Institute for Government and the King’s Fund. “The Five Giants: A Biography of the Welfare State,” his final, fully-updated, and award-winning edition of the welfare state’s history, from Beveridge to the modern day, is published by William Collins


Watch the video: Beveridge Report Video


Comments:

  1. Huntingden

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  2. Neville

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