‘Something-for-something Britain’

It was a heck of a year. 1942 wasn’t the beginning of the end. But it was, as Churchill said, the end of the beginning. The Allies turned the tide in north Africa, Stalingrad and Guadalcanal. Interest in what the fight was for hit a new high and, 70 years ago today, Sir William Beveridge provided a new answer. From dawn on 1 December 1942, the BBC broadcast details of his new blueprint for social security in 22 different languages and his report was swept off the shelves.

The men and women who came home from that war rebuilt a different Britain. A country of full employment and social security that revolutionised life chances for their children, the baby boomers. Today, our challenge is different but stark; to rebuild a one nation Britain where we revolutionise life chances for the grandchildren of that generation that came home from the second world war.

And that’s why we need social security to change. Because life has moved on since Beveridge. The job for life has gone. Forty per cent of jobs of part-time, self-employed or temporary. Women now work. We sold off all the council houses. As a country we’re aging.

Together these changes mean working people need new things: childcare, social care, help with retraining, help with home, and stronger regulation of pension costs. But the problem is that many are paying an awful lot in – and not getting much out. Indeed, someone in their 50s might pay in over £62,000 more than they get out of the system in state pensions. No wonder confidence in the welfare state is falling.

The Conservatives, of course, promised a revolution. But now it lies in tatters. The soaring cost of worklessness is pushing up the welfare bill by £20bn more than forecast. The work programme is securing jobs for just two in 100 workers, councils where jobs are fewest are facing the biggest cuts, and universal credit is disappearing into the sunset.  This vast new cost of failure is forcing the government to shortchange Britain’s strivers, axing £14bn from tax credits and pushing working families into poverty. Contributory benefits, already small, are set to become a rounding error.  Excluding pensions, by the end of this parliament they will be just three per cent of the benefits bill. It is five to midnight for Beveridge.

There has to be a better way. Today Labour sets out our ambition to move from shortchanged Britain to something-for-something Britain. And we should start by looking at new help for older workers. What they learned in school no longer lasts a lifetime. Japan has revolutionised support for older workers seeking to retrain for new careers. Japan has pioneered a gold standard service supporting older workers into work, and if Britain matched Japan’s employment rate for 50- to 64-year-olds, then nearly half a million more people would be in work and tax receipts could rise by £3bn a year. We should learn from examples like this. They enshrine a simple principle: social security should offer more for those that chipped in most. Our most experienced workers have earned an extra hand. So let’s make sure it’s there when they need it.

Beveridge was seared by the experience of the mass unemployment of the 1930s. He knew full employment was the bedrock of social security. That is as true today as it was in 1942. That’s why next week we want a budget for growth and jobs. But there’s a second challenge today. Britain’s workers are producing more but earning less. If we let that continue, social mobility will be slammed into reverse and perhaps the greatest legacy of Britain’s postwar economic and social renewal will be lost. Good social security systems help working families juggle care, work more and save up. That’s good for living standards, growth and the Exchequer. On this 70th anniversary of Beveridge, a strong system for working people should be the ambition that once again shapes reform.

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Liam Byrne MP is shadow secretary of state for work and pensions. He tweets @LiamByrneMP

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Photo: LSE Library

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