The Welfare Crisis

Since late 2008, when the recession kicked in, the number of unemployed and people claiming benefits has been steadily rising. In January 2010, there were some 2.5 million unemployed people in the UK, or 7.8 percent of the working-age population, with over 1.6 million claiming Jobseeker’s Allowance. One after another, government ministers and politicians have utilised this ‘unemployment crisis’, clearly exacerbated by the economic downturn, to push for old plans to ‘reform’ or dismantle the social welfare system.


Some history

New Labour’s welfare reforms date back to the late 1990’s, when the so-called Blair-Clinton orthodoxy on social welfare promised to deal with the mass unemployment that had reappeared in western industrialised countries during the previous decade. The new doctrine was also a response to globalisation, which placed wage relations back at the centre of politics. But it was more than simply reforming social services; it was driven by specific ideological and ethical premises and with far-reaching implications.

Denying the relevance of class and exploitation in the labour market, ‘social justice’, the newly found buzz word, became a disguise for economic efficiency. The market values of employability, equal opportunities, and individual competitiveness became guidelines for social policy, which endeavoured to place ever greater restrictions on people’s eligibility for social benefits through tough, coercive measures aimed at disqualifying people from entitlement to benefits and driving them into paid work. Thus, those in need for social protection became simply ‘unemployed’ needing ‘help’ to get back into the labour market, and people out of work became a ‘crisis’. Moreover, greater powers were increasingly devolved to the private sector, not only in delivering services but also in designing and implementing policies and programmes. The old contractors were now often referred to as ‘partners’.

Many of these policies derived from neoliberal critiques of the postwar welfare state and had been started by the New Right governments on both sides of the Atlantic (Thatcher-Regan). Many of today’s training and employment programmes had previous incarnations in the Thatcherite era. In fact, the original architect of the current Welfare Reform Bill was none but David Freud, an investment banker who recently left Labour to embrace a job as spokesperson on the Tory front bench. Back in 2007, Freud wrote the government’s ‘controversial’ white paper Reducing Dependency, Increasing Opportunity: Options for the Future of Welfare to Work, which proposed a greater role for the private and voluntary sectors, with payment based on results, to ‘help’ people move into, and stay in, work. In return, the report argued, there should be increased responsibilities on benefit claimants to look for work. Many of the new measures introduced by the latest welfare reforms mirror Freud’s proposals.


Coercion as help

At a jobs summit in January last year, Gordon Brown promised, in a bid to stop unemployment increasing further, to ‘help’ 500,000 people into work or training. The £500m plan promised employers £2,500 for every person, who had been unemployed for more than six months, that they trained and employed. This ‘help’ would include extensive job interviews and ‘training’ programmes aimed at getting people ready for jobs they do not necessarily want to do. In return, claimants would have to sign on weekly for benefit payments.

Former Work and Pensions Secretary James Purnell was a little more explicit: “What we have learned from previous recessions is [that] we need to make sure people don’t feel out of touch with the labour market.” The same argument was used by Employment Minister Tony McNulty MP answering readers’ questions on the BBC website in December 2008: “In previous slowdowns, government has made the mistake of easing the benefit regime and allowing people to drift into inactivity, leaving them ill-prepared to take advantage when the economic recovery came. It is key that this time we keep people attached to the labour market.” In other words, the recession should be utilised to force people into paid employment rather than allowing them to claim benefits due to the economic hardship. The new euphemism for this coercion is ‘help’ and the wider implication is a restructuring of the welfare system that prioritises employability over welfare.

Naturally, much of the emphasis has been on the jobless youth; a ‘major concern’ for the government, we are told. In his pre-budget speech to the Commons in December 2009, Chancellor Alistair Darling revealed a £550m scheme that will “guarantee work or training” for young people who have been unemployed for six months. This is because, to quote Work and Pensions Secretary Yvette Cooper, “the longer young people are unemployed, the harder it can be for them... and that’s why we are investing this extra help.”

More than a quarter of 16 to 24-year-olds classed as unemployed are actually in full-time education. Young, inexperienced people are also particularly vulnerable to exploitation as many unscrupulous employers use them as cheap or free labour. Forcing them into work as quickly as possible through such ‘help’ schemes is just the right recipe for further exploitation.


Propaganda as news

This political spin and rhetoric is often recycled by mainstream media without much questioning or analysis. Headlines promising, or even demanding, ‘more help’, ‘guaranteed jobs’, ‘immediate action’ and so on have become all too familiar. Government press releases are copied, almost word for word, and presented as news reports; officials are quoted celebrating the government’s achievements, while any criticism is censored or watered down. The only ‘counter opinion’ presented is often some pressure group saying ‘not enough is being done’.

For instance, a BBC series last year, titled Britain’s Jobless: Who Cares?, was based on the hypothesis that British society “has been ignoring the real plight of the jobless.” With five case studies selected carefully to portray the long-term unemployed as people “who want to work but, for many reasons, are not searching,” the main conclusion readers are driven to reach is that not enough assistance is being offered to help these people find a job. Although the introductory text does point out that the government’s approach of forcing people into work may not bring about the desired results, the main argument is that long-term unemployment is damaging to people’s mental and social health.

A better example is Benefit Busters, Channel 4’s hit series on unemployment and benefits last year. ‘Benefit busters’ is a term used by A4e, for example, to describe its business and may imply, as in ‘crime busters’, that benefit claimants are ‘scroungers’.

Two of the three episodes focused on A4e ‘helping’ single mothers in Doncaster and long-term unemployed people in Hull. The programme has been described by many as “uncritical” and “a promotion for A4e”, which may explain why the company has a prominent link to the programme on its website, along with a picture of all-smiles A4e chair Emma Harrison and A4e tutor Hayley Taylor standing side by side. Another little detail that many may not be aware of is that the series was produced for C4 by Studio Lambert. The company’s chief executive, Stephen Lambert, was the creator of another C4 hit series, Secret Millionaire. Emma Harrison was the heroine of episode five of series one, first aired in January 2007. On her blog, Harrison shares the “inside track” on the making of Benefit Busters:

“More than a year ago, a guy called Stephen Lambert phoned me up. Stephen and I had previously worked together on two TV programmes - Make me a Million and Secret Millionaire. He is very good at what he does. He told me that he wanted to make a documentary about real people involved in the benefits system to be screened on Channel Four. We had a couple of meetings (and a few phone calls) and, after some serious thinking, A4e agreed to take part. The Department for Work and Pensions gave their blessing and the research began.”

With not enough time or staff to investigate or even edit properly, local papers are often much worse. A Warrington Guardian article on 29th January 2010, titled ‘Meet the people getting Warrington’s unemployed back to work’, was little more than a promotional advert for A4e. The article claimed the company’s “formula of building up people’s confidence and providing them with whatever it is they need to get a job” had been “so successful” that 120 people in Warrington had found a job in the previous four months, at a rate of one person a day. The piece then cites a number of ‘success stories’ and quotes at length from A4e’s business manager bragging about his company’s social achievements. Absolutely nothing about A4e’s business or the quite-well-known controversies surrounding it in recent years was included.


Jobcentre on the move

As with other privatisation projects, the ‘failings’ of Jobcentre Plus in ‘helping’ the unemployed are often used to justify its sell-off. A recent BBC Radio 4 programme, Jobcentre Plus - Not Working, claimed there was “concern that advisers are not able to deliver the personalised and professional service promised by the government because they are so badly stretched.” Presenter John Waite examined claims that Personal Advisers are “under-resourced, under-trained, under pressure and unprepared” for the demands of the “growing unemployment crisis.” Who made these claims is not very clear but the ‘solution’ suggested (often in subtle ways, such as selecting certain commentators and silencing others) is that the institution needs ‘innovation’ and ‘modernisation’ – words that often herald the privatisation of public services.

In June 2009, the Institute of Public Policy Research, a think-tank with strong ties to the Labour party, published research into Britain’s employment services after interviewing over one hundred front-line advisers, including 40 or so from Jobcentre Plus. The report, which concluded that Jobcentre Plus advisers were “overrun by the extra demands of the recession,” was discussed on the afore-mentioned Radio 4 programme, after which Employment Minister Jim Knight was hosted saying, among other things, “That’s why we’ve contracted a good range of executive recruitment agencies to provide a service for those sorts of people.”

Back in 2002, Gordon Brown declared a “street-by-street, estate-by-estate” war on “unemployability.” The context at the time was the then-chancellor trying to sell a new initiative involving mobile job centres that would “tour unemployment blackspots, alerting people to vacancies and offering advice.” The announcement, of course, was all over the press but the plans never materialised, except in creating a discourse on “the culture of worklessness.” Other DWP ‘outreach efforts’ to deal with the ‘growing crisis’ of unemployment have included installing job search touch screens in public places, such as libraries and supermarkets. The new technologies are often provided and managed by private companies and are just another step towards breaking up, and then selling off, the services traditionally provided by Jobcentre Plus. Similar tactics can be observed in the ‘modernisation’ of the Post Office and the NHS.


What crisis?

We have already said, in more than one place, that the whole benefits regime is becoming increasingly about getting people back into paid work, which is justified mainly by ‘soaring’ mass unemployment. But leaving the political rhetoric and media-driven hysteria aside, what is this ‘unemployment crisis’ all about?

While employment has fallen by 2% over the past few months (still a fraction of the fall in economic output), unemployment benefits, especially for families without kids, are much lower than they were in past recessions. It is also much harder to qualify for incapacity and other benefits these days. Still, staying on benefits is, in many cases, better than taking a job that pays less than £15,000 a year. Yet many jobs that claimants, particularly those with less marketable skills, are being pushed to accept are minimum-wage jobs at places such as Poundland, McDonald’s, supermarkets and other unscrupulous retailers. Another significant trend in recent years has been a big rise in people going part-time or accepting more ‘flexible’ contracts. During the recession, many preferred to accept little or no pay to keep their jobs. In a sense, the insecurity of poverty has been replaced by the insecurity of unemployment and wage dependence.

The approach taken by the government and its private ‘partners’ in reducing unemployment seems to be centred around bullying claimants into accepting any job available, based on the presumption that everyone wants to work, whatever the work is. Those who don’t are considered ‘parasitic free riders’. This logic, which blames unemployment on the unemployed and ignores the fact that job offers are subject to market mechanisms, is used to justify the criminalisation of the unemployed and the use of increasingly punitive and repressive measures against them (the ‘zero tolerance’ approach). Other possible approaches, such as reducing working hours or increasing the minimum wage, are readily dismissed as that might be politically dangerous: people with their basic needs met and a lot of time on their hands might be capable of too much.