|A TUC Union for Benefit Claimants !|
When unemployment benefit was introduced, it was seen as a ‘safety net’ for periods of sporadic unemployment. The Beveridge Report was written in a period of near full employment due to the war, and the post-war government committed to a policy of ‘full employment’ as demanded by the trade union movement. Indeed, due to enduring trade union pressure, unemployment was rarely above one million in the following 35 years.
Ironically, unemployment played a key role in the election of the Conservative government in 1979 with the famous ‘Labour isn’t working’ poster showing a long snaking dole queue – depicting the concern that over 1 million people were unemployed. By the mid-1980s however, unemployment would peak at more than 3.5 million.
Structural high unemployment has now become a feature of the UK economy, due to weakened employment and trade union rights that has led to casualisation of the workforce and less protection against redundancy.
In this environment a social insurance system that delivers temporary income replacement for periods of interrupted employment is needed more than ever.
* "FACT: When first introduced, unemployment benefit was paid at the same rate as the state pension, then 26 shillings."
In 2011 long-term unemployment (out of work for over a year) was higher than total unemployment 40 years previously.
Unemployment benefit, now known as Jobseeker’s Allowance (JSA), has become increasingly devalued in recent years, as it has been uprated in line with inflation, rather than with average wages.
Despite the UK Chancellor’s rhetoric about “people who think it is a lifestyle choice to sit on out-of-work benefit”, JSA pays only £65.45 per week (£51.85 for under-25s). If unemployment benefit had kept pace with earnings since 1979, it would be worth about £110 per week today.
In 1970 unemployment benefit was worth nearly one-fifth of average earnings, today it is 10%. The basic state pension is £102.15 per week – over 50% more than JSA. In 1946, in an economy ravaged by war, the level of unemployment benefit was worth almost double what it is today relative to average wages.
Many of our members have expressed they would not be confident of surviving on the current rate of JSA.
* "FACT: There are over 2.5 million unemployed and less than 500,000 vacancies."
“Social insurance should aim at guaranteeing the minimum income needed for subsistence… determination of what is required for reasonable human subsistence is to some extent a matter of judgement; estimates on this point change with time, and generally, in a progressive community change upwards.” The Beveridge Report (paragraph 27)
There is also a popular myth that a ‘life on benefits’ is too comfortable, that welfare dis-incentivises people from looking for work. David Cameron, in announcing his Welfare Bill said, “never again will work be the wrong financial choice”. However, research from 13 countries in Europe, North America and Australasia showed “work morale is actually stronger in countries with more generous welfare states”.
This should not be surprising. As Professor Richard Wilkinson has argued, “a society which makes large numbers of people feel they are looked down on, regarded as inferior, stupid and failures, not only causes suffering and wastage, but also incurs the costs of antisocial reactions to the structures which demean them”.
In the 1980s, when unemployment was accelerating towards its post-war peak, the Conservative Minister Norman Tebbit suggested the unemployed should get on their bikes and look for work. Today, welfare minister Iain Duncan Smith suggests the unemployed of Merthyr Tydfil should “get on their bus” to Cardiff. Yet in the Welsh capital there were already nine people for every vacancy.
The role of government was once seen to be guaranteeing full employment, but successive governments have privatised more of the economy and deregulated the labour market. They now blame the victims for their own unemployment.
Instead we need:
* Job creation based on public investment in new energy, transport and housing infrastructure and in public services
* A dignified standard of living for those out of work, with much increased benefit levels
* More free training and educational opportunities for the unemployed.
Much of the welfare state, since its inception, exists to subsidise low rates of pay for those in employment. Initially some unions opposed these elements of welfare, which they saw as a cheap substitute for higher wages, which legitimised low pay by exploitative employers.
In some ways this was in tune with the thinking of post-war planners like Beveridge who wanted to consign the means test to history, and like Keynes who believed in full employment (with the assumption that employment paid a wage sufficient to support a household).
It was the women’s movement that fought for family allowances and other payments such as Child benefit, which are normally paid to a female parent. The trade union movement had long argued for a minimum wage, and in 1998 the National Minimum Wage (NMW) was introduced.
Today, Income Support provides an income for those working less than 16 hours per week who do not have substantial savings. This particularly benefits women who tend to be the primary carer for children and elderly relatives. However, as Beveridge knew, means-tested benefits are more complex to claim, attract stigma, and therefore have lower take-up rates.
In 2010 £16 billion in benefits and tax credits were unclaimed. Only £5 billion is lost through the combined effects of error and fraud."
** The real scandal in welfare is not people receiving what they are not entitled to, but people not receiving what they are entitled to. **
Since we know means-testing is often ineffective at directing support to those in need, it makes sense to focus our efforts on ensuring that work pays through tackling low pay and building strong unions in the workplace.
In its first ten years the NMW increased above the rate of inflation, but in the past three years it has been devalued in real terms due to below-inflation increases. A full-time job at the NMW would give a scandalously low annual salary of just £10,793. Tackling low paying employers remains a vital task for trade unions through collective bargaining, and lobbying for a living wage.
Low pay is endemic in many sectors of the economy, including catering, cleaning and caring – all jobs disproportionately carried out by women. There is a gender pay gap as a result of discrimination against women individually, and structurally against the work they do – meaning low pay disproportionately affects women.
However, as long as low pay exists, this element of welfare is essential in preventing further poverty and destitution. We need to:
* Campaign for a substantially increased national minimum wage or a ‘living wage’
* Provide greater advice and assistance to ensure people receive benefits they are entitled to
* Build strong trade unions in each workplace, with stronger trade union and employment rights, as a bulwark against low pay.
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* Unemployed & benefit claimants can join a trade union - http://
blog by: Respect For the Unemployed & Benefit Claimants