UK needs to ‘re-adopt the language of social security’, says new report from SSAC and the Institute for Government

Covid has thrown up deep questions about the structure of financial support provided to working-age people, and there's a strong case for the government to reassess what the benefit system is for and to change the language used to describe it

The UK needs to 're-adopt the language of social security', the Social Security Advisory Committee (SSAC) and Institute for Government (IfG) have said.

In a joint report, Jobs and benefits: the Covid-19 challenge, the SSAC and IfG draw on discussions among former senior civil servants, academics and other experts at two recent roundtables held under Chatham House rules to examine questions thrown up by the experience of Covid-19, and to provide advice to the government on the areas most in need of attention over the coming months and years.

However, while acknowledging that the pandemic has posed challenges to the government of a nature and scale that were impossible to imagine a year ago, and that the current benefit system has 'held up very well', the report says that -

'... the pandemic has also thrown up deeper questions about the structure of financial support provided to working age people ... there are ways in which it could be fine-tuned to make it more effective. There is also a strong case for the government to reassess what the benefit system is for and to change the language used to describe it.'

For example, the report highlights that the UK's benefit system has become increasingly means-tested, more conditional and less generous and that, when people find themselves out of work, income replacement rates are low by the standards of many other developed countries. In addition, the DWP's labour market approach has essentially been one of ‘work first’ based on the view that it's important to get people into any type of paid work as a first step, rather than necessarily waiting for a job that might better match their skills. 

As a result, the report suggests that over the last couple of decades the UK has 'lost the concept of social security’ - 

'... the benefit system has increasingly come to be discussed largely in terms of ‘welfare’ - the means-tested bit - when the UK’s social security system has always been more than just a safety net for the least well off.'

However, highlighting the possibility that public attitudes to the generosity of the benefits system will continue to improve if not accelerate as a result of the pandemic (in the same way that attitudes changed following the rise in unemployment in the early 1990s), the report suggests that there is a chance to think afresh about the UK's approach to benefits and employment services, to reassess what the benefit system is for, and to re-adopt the language of social security - 

'... Many of those who have already lost jobs [during the pandemic] had no reasonable prior expectation that was about to happen and that will be even more true in coming months. They will have an entirely reasonable expectation that they should receive at least a degree of security, rather than dependence on ‘welfare’. It needs to be better understood that Universal Credit is designed to provide security not just to those who are unemployed but, in normal times, to much larger numbers who are in paid work. Universal Credit is not ‘welfare’. It is part of a system of social security. A social security system for many who are in work, for those currently out of it, but also for those who face the risk of unemployment when the next major shock hits. The language used to describe the benefit system affects attitudes and matters. It should change.'

NB - the report also makes a series of recommendations setting out what it describes as steps towards improving the structure of the UK’s system of benefit and employment support in the light of issues that the Covid-19 pandemic has highlighted, including -

Fine-tuning the current benefits system to make it more effective, for example by -

• increasing the savings rule in universal credit to £25,000 (where it would be had it risen in line with prices since its last increase in 2006) and exempt funds held in a Lifetime ISA;
• index-linking the savings rule and all other thresholds and limits, including the household benefit cap, child benefit withdrawal points and local housing allowances;
• where individuals are debarred from universal credit by their savings, more actively pointing people to contribution-based jobseeker's allowance (JSA) and employment and support allowance (ESA);
• introducing a non-repayable ‘starter payment’ for new claims for universal credit, where a run-on of legacy benefits is not otherwise provided;
• reviewing the level of support provided by universal credit to those out of work in the context of the government’s objectives for reducing poverty, with any enhancement to universal credit also applying to legacy benefits and contributory benefits;
• increasing work incentives by increasing the work allowances and/or reducing the taper in universal credit and/or providing stronger incentives than universal credit currently does to encourage second earners; and
• strengthening contributory JSA in order that the rate is not below that provided by the standard allowance in universal credit, and ensuring that it runs for a year not six months.

Changes to manage the return to employment and the sectoral shifts involved, for example by -

• developing a fully co-ordinated response - led by an inter-departmental joint committee or cabinet committee - to address the differential impact of the pandemic on different sectors of the economy and the need for re-skilling and re-training;
• providing for closer work between Jobcentres and local government to bring together employers, education providers and careers advice services;
• providing government support (such as vouchers) for training by employers, with the important proviso that the training must be carefully regulated to ensure that it is of sufficient quality;
• learning lessons from the experience of the Work Programme and from international evidence about how to contract effectively with external organisations for employment support, including ensuring that undue risk is not transferred to smaller organisations; and
• applying flexibility in how and when conditionality is applied in universal credit, on the basis that a constructive relationship between work coaches and claimants in finding not just any job but suitable jobs is likely to yield better enduring results for both individuals and the economy than merely enforcing work search conditions.

For more information, see Jobs and benefits: the COVID-19 challenge from gov.uk

Update (18 March 2022) -  the government's response to the report has been published today.