Do you support the principle of universal benefits?

Peter Stringfellow receives the winter fuel payment for pensioners. Alan Sugar is entitled to claim a bus pass, although he hasn’t done so. In an age of austerity, when cuts are being made to benefits for the sick, disabled and unemployed, should we be making these freebies available to those who don’t need them? I think we should.

This is an issue which divides people on the left in British politics. Sunny Hundal says we should support some universal benefits (health, social care, pensions) but accept that not all benefits need to be (or can be) universal. He argues there’s no evidence that middle class taxpayers will happily subsidise the ‘less deserving’ if they get universal childcare, universal winter fuel allowance or universal education themselves. He continues: “We need to push a social security system that focuses more on universal services than cash benefits. Our aim should be to restructure the state to reduce inequality, not rely on small handouts to wealthy pensioners in the hope it buys support for other benefits such as for the unemployed.”

Cameron has already broken his 2010 promise to maintain universal child benefits, but he’s defended the winter fuel allowances and bus passes for all pensioners. That’s probably because pensioners are more likely to vote Tory than any other age group, and pensioners are more likely to vote; 76% of them did in 2010, compared to the overall turnout of 65%. Labour has said that it will withdraw the winter fuel payment from wealthy pensioners, but is that such a good idea?

Owen Jones thinks that “stripping the welfare state of its universalism will breed a middle class that is furious about paying large chunks of tax, getting nothing back and subsidising the supposedly less deserving. It will accelerate the demonisation of the British poor.” Peter Hain has been even more vociferous, questioning whether Labour is really going to offer an alternative to Tory policies on welfare. Hain warns that the decision to restrict winter fuel payments will "open the door to a wider attack on universal benefits”, adding that “cutting or means-testing pensioners' allowances risks turning young against old and rich against poor, while making negligible savings for the Treasury”.

Writing for ‘The New Statesman’, George Eaton reminds us that the government currently spends £2.2bn a year on winter fuel payments, £1bn on free bus passes and £600m on free TV licences. Meanwhile, £23.8bn is spent annually on housing benefit (because of extortionate rents and substandard wages), £27.2bn is spent on tax credits (because of inadequate pay), so it becomes clear where the real savings are to be made. Eaton says: “It makes little sense to target benefits for cuts when £70bn a year is still lost to tax evasion, £25bn to tax avoidance and the highest earners (including those dreaded ‘millionaire pensioners’) have just received a £1bn income tax cut. By insisting that the welfare state (or at least part of it) should bear the brunt of austerity, the left is playing Osborne's game.”

Eaton continues: “The great practical advantage of universal benefits is that they ensure support goes to those who need it. At present, 1.8 million elderly people eligible for the means-tested pension credit do not claim it due to the complexity and invasiveness of the application process. In the case of the winter fuel payment, restricting the benefit would risk an increase in the 25,000 pensioners who die every year as a result of cold-related illnesses.”

If you’re not going to pay a benefit to everyone, it has to be means-tested, and that’s expensive and requires more bureaucracy. A Fabian Society study of 11 OECD countries found that greater means-testing led to increased levels of poverty as the value of benefits progressively withered. It’s happening here. While removing child benefit from higher-earners, this government has simultaneously frozen it in cash terms for three years, which is a real-terms reduction of £1,080 for a family with two children. As Richard Titmuss said more than forty years ago, "services for the poor end up being poor services".

Supporting a winter fuel payment for Peter Stringfellow doesn’t mean that you favour the rich, it means you favour simplicity and avoiding waste on unnecessary bureaucracy. Put the top rate of income tax up to 60% or higher, so that the rich can pay their share in creating a more equitable society. They can then treat their child benefits or winter fuel payments as a tax refund.

The logic of means-testing is remorseless. Remove child benefits and winter fuel payments from the better off and before long it will be only the very poor who receive them. What next? Right-wingers will say that those same people must pay for their NHS treatment, and then another example of universality is undermined. Restricting child benefits and winter fuel payments is just the thin end of the wedge.

Sources:-

http://liberalconspiracy.org/2013/06/05/a-lot-of-what-we-assume-about-universal-benefits-is-just-wrong/

http://www.newstatesman.com/politics/2013/06/peter-hain-attacks-labour-plan-remove-winter-fuel-payments-wealthy-pensioners

http://www.newstatesman.com/politics/2013/04/why-labour-must-defend-universal-benefits-pensioners

Finally something I can nearly agree with Ivan. Yes lets have universal benefits, but why should the tax rate have to go up, surely anybody that pays 40% tax should have their tax details sent to the DWP who simply cross their names off of the list, no means testing and no unfairness in our "One Nation" Britain.

tlttf wrote:-
Yes lets have universal benefits, but why should the tax rate have to go up, surely anybody that pays 40% tax should have their tax details sent to the DWP who simply cross their names off of the list, no means testing and no unfairness in our "One Nation" Britain.

You seem to have missed the point. What you’re suggesting (and what Ed Miliband is proposing to do) is to stop the winter fuel payment from being a universal benefit – that is, one paid to everyone over the age of 60. By cancelling the benefit to anyone who pays 40% tax, you are effectively means-testing it. My argument is that before too long, it would probably be stopped for all taxpayers, and what next? We’d soon be hearing that the better off don’t need the state retirement pension, and on it would go.

If the benefit is paid to everyone, it’s difficult to abuse the system. And if the top rate of income tax is raised, it would be a lot easier to justify continue paying the benefit to Richard Branson, Alan Sugar etc – the exceptionally rich who are hardly typical of the vast majority of winter fuel payment recipients. Of the UK's eleven million people over the age of 65, two million live in poverty and another six and a half million have an income below £10,500 a year.
http://www.newstatesman.com/politics/2013/04/why-labour-must-defend-universal-benefits-pensioners

The top rate of tax also needs to go up because inequality has increased dramatically since the 1970s. Inequality causes high levels of debt, and that becomes unsustainable. For a number of reasons, inequality is bad for everyone, rich and poor, but that’s another story for another place:-
https://cuttingedge2.forumotion.co.uk/t709-does-inequality-matter

The Beveridge report in 1942 recommended that the government should find ways of fighting the five 'Giant Evils' of 'Want, Disease, Ignorance, Squalor and Idleness'.

When the Labour government of Clement Attlee brought the Welfare State into being, it was recognised that there could be all sorts of argument over who might be entitled to what unless Benefits were universally available to everyone.

Logically, the higher taxation of higher incomes would equalise the relief enjoyed. If that isn't the case, then it is the tax regime which needs to be modified - not the Benefits entitlement.

http://www.bbc.co.uk/history/historic_figures/beveridge_william.shtml

We can discuss the past until the cows come home, I quite enjoy nostalgia. However, I think the Beverage report was of it's time. Clement Attlee and Nye Bevan were great reformers and our welfare state was for years the envy of the world thanks to people who spent a lifetime paying national insurance and income tax. These days the people who paid for the welfare state are increasingly forgotten and told that life saving treatment is too expensive and are faced with the choice of selling their home or dying. This at a time when the NHS is overrun with people who have never paid a penny into the system! how the hell can anyone say this is right? However, in todays society you would have to be a racist to voice such concerns...

The usual "What about me?" argument was anticipated by the Welfare State programme introduced by a Socialist Government in 1948, and serves until the greedy manage to overturn universal entitlement.

How fortunate are those who do not plan to get old or needy.

faced with the choice of selling their home or dying.

I don't know of any case of this sort - I know some people are having to sell their homes to finance alternative accommodation with care that is more suitable to their needs - personally, I don't see a lot wrong with that, but I know not everyone agrees with me.
Perhaps there is some evidence I'm unaware of - if so, I'd be grateful if you could point me at it.

the NHS is overrun with people who have never paid a penny into the
system!

Again, this is something I'm not particularly aware of - I know small children are net consumers of health services and haven't paid in although their parents hopefully make some contruibution via taxes on their behalf.
As far as I am aware, everyone living in England pays tax in some form or other (income tax, national insurance, council tax, vat, road tax, probably others I'm not aware of), and the NHS is paid for out of taxes, including, but not exclusively national insurance and income tax.
Not sure how anyone can use NHS services without living in the country. Perhaps again you have some evidence on this point?

On the other hand, I'm not really sure how the NHS could continue to function without the work of people from other countries - I assume they're all paying their taxes.

Red Rackham wrote:-
the NHS is overrun with people who have never paid a penny into the system!

boatlady wrote:-
Perhaps you have some evidence on this point?

Evidence? Who wants evidence when it might spoil a good story?
 
What Jeremy Hunt calls “the costly abuse” of the NHS by foreigners amounted to £12 million in 2011-12. That’s 0.01% of the NHS budget. Maybe “overrun” might be considered a slight exaggeration, don’t you think?
http://www.newstatesman.com/politics/2013/06/how-much-does-health-tourism-actually-cost-nhs
 
In a so-called ‘civilised’ society, should foreigners be left to die in the street if they’re injured in an accident, and what if they've contracted a contagious disease? Would the resulting epidemic save money for the NHS??

I'm fascinated by the notion of an English-language examination being carried out before there can be a medical examination in an NHS hospital or GP's surgery.

That means another modification to the ancient Hippocratic Oath.

Wonder what they'll do to desperately ill foreigners?
Just out into the streets to bleed to death, do you think?

Perhaps Jeremy *unt will propose that they rebuild the old ISOLATION HOSPITALS which used to be a feature of Britain's seaports.

Or the hulks

The argument to my mind isn't whether the 'rich' should receive benefits or not; its about maximising the benfits that those they are intended to help receive. Universal benefits by their very nature give something to everyone (yep the clue is in the name) ensuring that the least well off (not necessarily just poor) can easily and cost-effectively (to the state) receive that benefit. If it is agreed that a particular widely needed benefit is required it is ridiculous to put in place costly administrative boundaries. These would only serve to reduce the pot for the beneficiaries or increase tthe overall costs.

Oh, what a lovely sensible reasoned argument.

The essential thing is to be sure everyone gets what they need. Means testing is a very expensive method of rationing resources.

A warm welcome for Gill Troughton, (Labour clr for Bransty, Whitehaven. Ex doctor & LG strategic planner.Copeland CLP Chair. Christian. Mother. Own views: politics, sport & nonsense), to our coterie of Tory-baiters.

Good - nice and clear - we support universal benefits and want tax rates to go up for the rich to fund them. Can you think of anyone who might disagree with this?

I support the principle of national insurance, whereby we all pay what we can easily afford so that anyone in difficulties is covered, Why have we all begun talking like spiteful yanks?

define 'we all' please

boatlady wrote:define 'we all' please

Fair enough. I mean that the Noise Machine has been set to American for some years. I cannot understand the selfish, spiteful accent.

'the noise machine'?

Do you mean news media?

Certainly not representative of 'all' - or am I missing some nuance?

I mean the bosses' Noise Machine which tells us all we agree with their drivel and denies anyone else a voice.   News media my American elbow!   How much news about the UK do we get given, ever?

There was a nice piece on BBC News this evening about disagreements among BBC Board of Directors which must have been useful to someone.

Are they all in receipt of universal benefits?  

Presumably the Universal Benefit of belonging to The Old Boys Club that runs Parliament, the Beeb, Quangos and City Boardrooms. Safe as mothers' milk.

Support or oppose, the Universal Benefit will be imposed in the Autumn instead of  

•Housing Benefit
•income-related Employment and Support Allowance (ESA)
•income-based Jobseeker’s Allowance (JSA)
•Child Tax Credit
•Working Tax Credit
•Income Support

Claimants will require access to the internet, and to have a Bank account.

Should give rise to a whole new industry of "advice" scams.

Old news, OW - we've had it in my town since last April - it is a genuine nightmare and the reason why I never have any spare time - currently spending about 21 hours a week mostly helping people get their benefits paid via Universal Credit - we are having families made homeless every week because of delays in payment and miscalculations - even families where the head of household is employed; foodbank use has soared and many adults have formed the habit of only eating every other day

Despair! But now the Tories are busy tearing lumps out of each other, it may deflect them from many more years of bullying the common man.

The harm done by this bunch of psychopaths is immeasurable - I doubt we will see healing this century. The sooner all the Tories eviscerate each other the better