Absolute poverty is when people have insufficient income to afford the essentials of life, such as food, rent and clothing. (Blackmore …show more content…
and Griggs p. 52) “Beveridge calculated a national minimum income based on the poverty surveys in the 1930s and beforehand, conducted by Seebohm Rowntree.” (Blackmore and Griggs p.101) “Rowntree surveys employed an absolute definition of poverty that converted the cost range of essential items in a weekly household budget.” Relative poverty is when people have income significantly less than the average income for society. Townsend was aware that maintaining an accustomed standard of living involves more than just have a sufficiently high income. He saw that people’s health, housing and working conditions would also affect living standards. Alcock et al. (2016 p. 237) “Townsend… (Poverty in the United Kingdom, Penguin 1979) indicated that it was this notion of deprivation, rather than simply income poverty, that better captured the problem of an inadequate standard of living in modern society.”
Low growth in the economic system in the 1960s meant that high public spending on welfare could not be substantially feasible. Labour imposed real cuts to the welfare in 1976, with James Callaghan stating that “The Party was Over”. Regrettably, this hit the most vulnerable segments of society hardest. By the mid 1970s the Conservative party (New Right) had abandoned its commitment to the consensus on social benefit. In 1979 the Labour Party lost the general election and the Conservative party and its leader Margaret Thatcher became the first female Prime Minister. Thatcher’s government of the 1980s produced a substantial shift in the approach to thinking about, and to the actual provision of social welfare. This was a shift that challenged decades of social democratic thinking. By 1979, Thatcher openly rejected Beveridge and the dedication to the universal collective provision according to need. Conservatives view was that states should be minimal and government small. However, stated that generous benefits produced poverty. Residual welfare state for those who cannot genuinely provide for themselves. People could look after themselves and not depend on the nanny state.
(Blackmore and Griggs p.102) “Conservative administrations led by Thatcher and Major preferred to discuss ‘low income’ or ‘low income groups’ rather than ‘poverty’ or ‘the poor’.” The Conservative party traditionally considers the poor as a natural aspect of the economy. They believe high benefits are a disincentive to hard work for the people who develop a culture of dependency. (Blackmore and Griggs p.102) “The term Social Exclusion can often appear as a substitute term for poverty.” Alcock et al. (2016 p.236) “Conservative government did not believe that specific policies were needed to combat poverty beyond the well-established provision of social security benefits; they argued that by the standards of the 19th century, few people were poor which meant there was no further need for policy actions.”
Thatcherism was based on a monetarist approach to the economy, a decrease in public spending on welfare and an increase in the role of non-statutory provide organisation. The real purpose of a monetarist economic policy is to keep inflation under control, a government that adopts a monetarist economic policy limits its economic interventions to controlling the money supply. Nevertheless, they failed to reduce overall levels of spending on welfare benefits. However, they did achieve more means testing not universal and stricter, selective welfare provision. By the mid 1970s, there was growing dissatisfaction with the social security scheme which has neglected to keep up with the changing nature of society in that the Insurance element had become far less important than the safety net of supplemental Benefit (National Assistance). The scheme had changed over time through a series of piecemeal reforms, the solution was a complex mass of benefits which few people understood. In July 1978 a Labour review had proposed the need for simplifying of the supplementary benefit system with clearer rules of entitlement, a reduced reliance on special payments and a fairer deal for married women. The two social security acts passed in the 1980s were concerned with special payments. Legislation in 1988 was concerned with five main areas; Income support (supplementary benefits), Family tax credit, Housing benefit, Social fund and pensions. Targeting groups of people who were perceived as being most in need. Alcock (2016 p.337) “the largest group of benefit recipients are children (with over 12 million receiving child benefit, through their parents) and pensioners.” One of the aims of social security is to relieve poverty and low income.
Tony Blair was elected leader of the New Labor Party in 1994, the Conservatives had been in power for 15 years. Blair wanted to demonstrate a clean break with Labour’s past record as the party of ‘tax and spend’. A key part was welfare reforms. New labor claimed they would modernise the welfare state. They wanted benefit recipients to pull their weight, with this new ‘rights and responsibilities approach.’ Blair’s approach was aimed at reforming the welfare system for people of working age, getting more people into work and reducing poverty. Welfare to work scheme was put up to encourage single parents, disabled people and older workers back to the workplace. Tony Blair set up a special cabinet unit to develop initiatives to assist the homeless, young single mothers, and older people. Social exclusion is the groups of poor who lack not only income, also access to social institutions. Gordon Brown introduced ‘redistribution by stealth’ by sharply increasing benefits to poor families at work paid through a scheme of tax credits. They hoped to radically reduce the amount of child and pensioner poverty. There has been some process made, however, poverty rates have not come down as fast as the government hoped.
The Coalition Government have augured that New Labour’s attempt to help the poor have resulted in the benefit system becoming more complicated. It was in many persons best interest to stay at home on benefits, because work did not pay. However, the Coalition Government have simplified into one straightforward benefit system called Universal Credit. They wanted to make the benefit and tax credit system fairer and simpler.
The two-tier system set up after the Beveridge Report was the system of National Insurance benefits underpinned by National Assistance benefits. Nations assistance was the safety net to fill the need of those not covered by the insurance schemes because of them being unemployed, on low wages, or disabled. Payments were made low, to encourage people to look for employment, it also helped do away with the workhouses. National Insurance became universal and compulsory. The insured population was entitled to unemployment, sickness, maternity and widows benefits, pensions, and a grant to cover the cost of death. National Assistance became Supplementary Benefits, and then Income support, these are paid to people on low income, and are means tested.
The welfare reform has made changes which are to take effect 2017/18, they introduced a benefits cap 2013, which means that working age people cannot receive more than a set amount in benefits, e.g.
Carers Allowance, Child Tax Credit, Income Support, Housing benefit etc. This benefit cap is to make sure that households getting benefits will not get more normally than the working household. Universal Credit is a means tested benefit for working and non-working people. Universal credit will replace Income support, income based job seekers, income related employment support, housing benefit, working tax credit, and child tax credit. Disability living Allowance is changing to Personal Independent Payment (PIP), the abolition of council tax benefit, and the 1% capping of rising to benefits and tax credits for three years. Duffy, (2014) suggested that “the Coalition’s VAT increase and benefit cuts have hit the poorest section of society the hardest.” (DWP 2015) “The department of works and pensions found that 41% of children in lone-parent families live in relative
poverty.”
The Coalition government’s policy Big Society was aimed to encourage businesses, charities, and informal providers to take a greater share of welfare provision from the state. The Civil Exchange (2015) found that the Big Society had failed to do what it had set out to do; the big society gap had opened in deprived areas which have lower levels of charitable giving and volunteering. Townsend (1979) sees the solution to poverty in the labour market, he believes social policy must have the job of reducing inequalities in the labour market. Fergal McGuinness published Poverty in the UK statistics for the House of Commons in 2016, he found that there were “10.4 million people in the UK in relative low income… 300,000 more than the previous year. The number of people in absolute low income decreased by 100,000 to 9.3 million.”
Poverty has been an issue now for many centuries, Beveridge saw the problem, and tried to help eradicate, with his research. The Government need to look at their policies and help wipe out poverty. Moreover, there are millions of people living in poverty, whether it’s relative or absolute poverty, Poverty whatever form should be eradicated in today’s society.