Those hailing a return to the principals of Beveridge are forgetting about full employment

I reblogged this post about the Beveridge Report by Jules Birch a couple of days ago, and it reminded me of a recent column by Peter Oborne, in which he outlines how (in his view) incredibly successful the Coalition Government has been in the realm of social policy. This is one of the successes he mentions:

“Iain Duncan Smith’s achievement at the Department for Work and Pensions, in particular, has been monumental. He is returning social security to the arrangement envisaged by Sir William Beveridge in his famous 1944 White Paper.”

This may illicit hollow laughs all round, but it highlights something I have heard a lot over the last four years from people who like to talk about ‘something for nothing culture’ or ‘dependency’. These people say the welfare state should come with responsibilities – the responsibility to look for work (or jump through whatever hoops some bright spark at Policy Exchange or whichever the latest fashionable Thinktank may be can come up with). To ‘get back to Beveridge’ then we need more conditions attached, workfare, sanctions and jobseeker ‘contracts’ to ensure those responsibilities are enshrined.

What these people forget though is that alongside his proposals for the welfare state and the responsibility on individuals – or social service state  as Beveridge himself preferred – he also set out the responsibilities on government with regard to the economy which would ensure this social service state could function as designed. A prerequisite was full employment. Beveridge actually wrote three reports, although we only ever really talk about the first.

His second was entitled “Full Employment in a Free Society”. A summary of the report written by Beveridge himself has been reproduced here, and is quite an interesting read. His recommendations on economic policy are pretty far removed from those asking for a return to the principals of Beveridge today. He writes:

“The first condition of full employment is that total outlay [spending] should always be high enough to set up a demand for products of industry which cannot be satisfied without using the whole man-power of the country; only so can the number of vacant jobs be always as high or higher than the number of men looking for jobs…

…Who is to ensure that the first condition, or adequate total outlay at all time, is satisfied? The answer is that it must be made a responsibility of the State. No one else has the requisite powers; the condition will not get satisfied automatically. It must be a function of the State in future to ensure adequate total outlay and by consequence to protect its citizens against mass-unemployment, as definitely as it is now the function of the State to defend the citizens against attack from abroad and against robbery and violence at home.”

He then goes on to write about how governments should budget, rejecting balanced budget mantras by saying:

“What is the essence of the new budgetary policy required for full employment? It is, first, that the Budget becomes in the fullest sense a National Budget, designed to guide and influence and guide the activities of the whole nation, and not simply to raise taxes and spend them on the purposes of the Central Government. It is, second, that the Budget is made with reference to available man-power, not to money; that it becomes, in Mr Bevin’s phrase, a “human budget”.”

He then rights, which chimes quite strongly with some things we see today:

“To submit to unemployment or slums, or want, to let children grow hungry or the sick and old untended, for fear of increasing the internal national debt is to lose all sense of proportion”

Much as the Conservatives boast of ‘creating’ 1.75m new jobs and of returning the welfare state to the principals of Beveridge, the truth is they (and let’s face it the other parties too), have abandoned one of Beveridge’s key messages and full employment and where responsibility for its achievement and maintenance lie. Left to the market, the quality of job creation has been poor and still vastly short of what’s required.