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The focus of this essay is to explore how far the development of the welfare state succeeded in eradicating poverty and inequality that was identified in the 1942 Beveridge Report. It will include how Rowntree’s second report identified the minimum income of which a family should be able to live off, and how the National Insurance Act provided a source of income for those who were below the poverty line. It will also include how the ‘Poor and the Poorest’ report change the poverty line and how Thatcher change the benefit systems in relation to public expenditure.
In 1936 Rowntree produced his second report on poverty titled ‘Poverty and Progress’ (Scott, 2007). Rowntree described poverty as an inadequate income that would not uphold a person’s health or maintain a small amount of social involvement (Deacon in Gladstone, 2007, Scott, 2007). He considered what different family units would need to spend on food, clothes and rent and this was the minimum income that a family should live off; this minimum was introduced as the ‘poverty line’ (Deacon in Gladstone, 2007). However his calculations included a costing for things that have no nutritional value such as tea but he labelled these as conventionally necessary (Deacon in Gladstone, 2007 Scott, 2007).
Following on from this in 1941 the Prime Minister Churchill commissioned Beveridge to look at the current welfare state to suggest how it could be improved (Cunningham, Cunningham, 2012). With his findings he produced the ‘Report on Social Insurance and Allied Services’ also known as the Beveridge Report 1942 (Benassi, 2012). The Report identified five giants that were want, disease, idleness, ignorance and squalor and his aim was to abolish them (Haralambos, et al, 2008). They were to be eradicated through the use of developing services, which would be funded and run by the government (Cunningham, Cunningham, 2012). Although want was the main giant Beveridge also acknowledged that not just one giant could be eradicated, but he had to eliminate all five evils (Haralambos et al 2008).
Beveridge identified want as the main giant, and he suggested that there should be a social security system that was available to everyone (Benassi, 2012). This was to insure that all people had a sufficient income to survive regardless of how many within the household (Haralambos et al, 2008). With this he suggested the state offered a ‘safety net’ which no one should fall below (Walsh et al, 2000). In 1946 family allowance was introduced, it was a universal non-means tested benefit that was to be paid directly to the mother regardless of the household income, however it was only available if the mother had two or more children (Brindle, 2010).
In 1948 the National Insurance Act was introduced, Beveridge used Rowntree’s income minimum to determine how much National Insurance each working person would pay (Scott, 2007). It would only be a small amount of their income, to provide the sick and unemployed with a benefit. It also funded people’s pensions, maternity payments, widows and orphans benefits (Blakemore, Griggs, 2007).
Beveridge made clear that there was a need for the National Health Service (NHS) and he hoped that alongside his other proposals this would eradicate poverty (Glennerster, 2007). The aim of the NHS was to provide free comprehensive healthcare system that was available to all regardless. With healthcare available to all this would then create a healthy work force and people would be able to ‘self-help’ themselves out of poverty (Allsop in Gladstone, 2003). In the 1945 elections the Labour government became dedicated to the development of the welfare state (Fraser, 2009). Attlee and Beveridge had a holistic approach on how to tackle the five giants, and the welfare reform of 1945 to 1951 were the most comprehensive of the century, and this is when the welfare state were established (Page, Silburn, 1999).
Able-Smith were well educated around poverty in the 1950’s and 1960’s and he believed that the Beveridge Report were unsuccessful at reaching its aims (Fraser, 2009). According to Fraser (2009 p.257) ‘the report was flawed and failed to live up to its promises’. Due to the growing concerns around social security and poverty Able-Smith and Townsend produced ‘The Poor and the Poorest’ report in 1965 (Lowe, 2005). The report identified that since 1953 there was a large increase in families that had fallen below the poverty line and (Glennerster, 2007) many people that were below the poverty line were working, which meant they were unable to receive benefits (Mitton, 2012).
As a result of their findings they re-defined the poverty line, they believe that if a family, individuals or groups were in poverty if they did not have the means to acquire what was identified in the Beveridge Report, live in conditions or have facilities that were expected such as flushing toilets (Haralambos, 2008). They also believed that if people were unable to have friend and family to their house for food then they were in poverty, this then introduced a new form of poverty called ‘relative poverty’. The report then led to an increase in benefits available (Fraser, 2009).
In the mid-1970’s almost all families were within the safety net that was provided by the state, many people were buying or had already bought their own homes (Glennerster, 2007). However in 1979 Thatcher came into power and believed that the welfare state was not the way out of poverty but the cause, as people were becoming benefit dependant (Page, Silburn, 1999). Thatcher then promised less state intervention, lower taxes and a reduction in public expenditure in relation to absolute and relative poverty (Fraser, 2009). Many benefits were abolished such as the unemployment and sickness benefit that were introduced in 1965, and benefits then became taxable (Page, Silburn, 1999). Unemployment was on the rise and although benefits had been reduced, public expenditure had increased as more people were claiming the benefits (Fraser, 2009).
New Labour was elected in 1997 and introduced the third way, they created new job opportunities to try and relieve people from poverty. Blaire introduces a new system called Tax credits which was aimed to help people out of poverty. However this plan did not work as fast as they hoped (Mitton, 2012). In 2008 Purnell promised the welfare state would have a major change since implemented by Beveridge in 1945, it was proposed that the private sector would be paid to provide jobs or training for the unemployed (Fraser, 2009). New labour also wanted to deal with social exclusion that some disadvantaged people were facing, by introducing centres such as Sure Start (Mitton, 2012).
In conclusion, Beveridge’s aim was to eradicate poverty and through the use of different legislations such as the National Insurance Act, the poverty that he defined was largely reduced, however Able-Smith and Townsend identified a different form of poverty that continued to be high. They then increased the minimum income that was needed for a family to have to live on. Thatcher came into power and the poverty levels began to rise again due to the cuts in benefits and the reduction of employment due to privatisation. When Blaire were elected he tried to reduce the poverty levels again by the introduction of Tax Credits and with trying to create new jobs and encouraging training courses. Poverty continues today as what is seen as essential for living is continually increasing.
Word Count: 1126
Reference List
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Thornes