Part of the role of the Church is to give the poorest in society a voice. It should be front and centre of the public debate about welfare reform, but the most recent intervention by Archbishop Nichols seems directed at the wrong target.
The current disincentive for work in the welfare system is indefensible. It is telling that no voice has been heard in the debate on any side suggesting that it is a good idea to have a situation where people can earn more than the average wage on benefits or that moving to Universal Credit (a simpler system with a reduced disincentive to work) isn’t, at least in theory, a positive step.
Welfare spending in the UK is now up around 40% of government spending (depending on what you include in the measure – this includes health). The debate around whether that needs to be reduced cannot be divorced from that of the general state of the public finances. The national debt stands to hit around the £1.5 trillion mark by the end of the Parliament. We will spend nearly as much this year on servicing the interest on that debt as we do on the education budget. There is substantial academic literature that points to the economically damaging effect of high levels of public spending.
Given the state of the economy is inextricably linked to our ability to help those struggling to get by there are a few points that Archbishop Nichols should consider.
There are some on welfare who are unable to work and, as a society we should ensure they have not just an adequate but a decent standard of living. But critically, to have the resources to help those in need, we need a prosperous economy.
There are some people who are poor but able to work. We need a growing economy to create jobs and a more personalised approach in local jobcentres to help people find work to support themselves and their families.
There are some who are poor and are in work but paid very little. We need to find ways to increase wages – a prosperous economy is, again, a vital element in enabling people to earn more. So is funding the kind of training and investment that enables people to undertake more well paid jobs; but that also depends on economic success.
That is the broad context, but what about the detail of the welfare reforms themselves? Are the changes perfect? Of course not. No centralised welfare system is ever going to be able to wrap itself around the myriad complex and unique situations people find themselves in, that’s why civil society will always be needed and indeed why we will never live in a world without food banks.
At Policy Exchange, we are examining the role that sanctions play in encouraging people to find work. It is a far from perfect system needing to be more punitive in some cases, but also more flexible in others, especially given the high rates of appeals that are won. We are considering how the Work Programme can be improved and whether there may be elements of reform possible to restore some kind of link between contributions made into the welfare system and what is taken out.
The ideas we will be proposing will not be perfect either, but at least they will be constructive contributions to the debate that will hopefully help in incremental ways to make things better. It would be great to hear more from Church leaders about how they think Universal Credit could be made to work more effectively for those in greatest need.
Ruth Porter is Head of Economic and Social Policy at Policy Exchange.
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