Welfare State 101

Welfare State 101:

The purpose of the Welfare State is to afford everyone dignity, opportunities, and access to society.
Who has maximal access to society? Working, childless, healthy, able-bodied, educated adults who own their own home. They can support themselves, they can socialise, help with causes, and so on.
So the aim is to get everyone as close as possible to that position.

Rule 1 is Health. 

If you aren’t healthy, you can’t work, can’t study, can’t look after someone else, can’t do anything as well as you could when you ARE healthy. The United States is a cautionary tale for all of us here – if healthcare is not comprehensive, people slip through the cracks and will bankrupt themselves trying to achieve health. There are a variety of valid options for running a health system, but the NHS is one of them – it is fundamentally sound, and good value for money by international standards. So, I wouldn’t mess with it too much; possibly try to fold optical and dental care into the system of paying taxes and then receiving free treatment at the point of need, but no more.
[For example, laser eye surgery is expensive, but cheaper over time than contact lenses. If I didn't have to pay up front, I would have had my eyes lasered 2-3 years ago when my prescription was sufficiently stable, and would be saving over contact lenses by now].

Rule 2 is Education

If you don't have any education, you won't have many choices in life. In fact, I think I've discussed the issue of education here.
Free education from nursery to A-level at a minimum. If someone drops out of education before age 18, they should be able to go back free as and when they're ready. I know plenty of people who didn't want an education aged 16, then grew up and realised better qualifications would be really handy. That's normal, and shouldn't be penalised.

Rule 3 is Money

Ideally we want all adults to either earn money directly, be supported by someone who is earning directly (e.g. stay-at-home parent supported by their partner), or be living off their own prior earnings (pensioner).
Due to unemployment, and disability, and taking time off to look after small children, and further education, and…there are many reasons why this isn’t going to work. At the moment we have a hodge-podge of systems and funds to deal with this, from Job-seekers Allowance, through Child Benefit, Tax Credits, Disability Living Allowance, and so on.
However, as I found while unemployed, there are cracks in this system – the specific one I slipped through is probably fairly rare, but there are common ones. How do we prevent people slipping through the cracks?
There's a radical solution - guaranteed income – every adult is guaranteed income equivalent to a full-time minimum-wage job after tax.
At the moment this would be around £11,200 a year (£6.19 an hour, 40 hours a week, 50 weeks a year). What is the cost of £11,200 a year for every adult in the UK? Well, according to census data we have approximately 63 million people, and about 16 million of them are 19 or younger – so call it 47 million people, times £11,200 a year.
That’s £517 billion, which is a suitably scary number (aka about 1/3 of the whole economy). However, a lot of the expense is already being paid – for example, everyone older than 65 who contributed to National Insurance is getting £5,700 odd a year as their State Pension, regardless of need.
Additionally, guaranteed income will cover Housing Benefit; Council Tax Benefit, Child Benefit...
The Department for Work and Pensions already controls a budget of £160 billion; Tax Credits and Child Benefits (coming from HMRC) is another £40 (that’s got us to £200 of the £500 necessary), and not to mention the fact that a basic income guarantee allows the social housing stock to be rented out, providing a countervailing income stream.
However, to close the gap, top tax rates, and corporate tax rates, are going to have to go up. The other side is that companies have more customers, fewer people who can’t afford to buy.
Also bear in mind that even with a Basic Income of £11,000 per annum, anyone earning more than about £45,000 will still be paying more tax than they are receiving in Basic Income; that’s around 10% of taxpayers and much more of the percentage of tax.
Why am I justifying this? The brief is that I am dictator and can create the welfare state I want - well there you go. It might not be complete, but that's a good start.


  1. To "Money" I'd add, between earning money "independently" and a guaranteed income, the fact that there is lots of valuable work that people do, that benefits society, that doesn't earn an income, or that doesn't naturally earn enough of an income to be self-supporting.

    So a parent being primary nurturer to small children is absolutely working, and deserves to be paid for that work, although the small children can't afford to pay the parent for the work they do on the child's behalf. But society benefits from that work, long-term, in the future earnings of those children as adults. And current adults benefited without paying directly from the care of adults when they were children. So let adults now, pay, retrospectively, for the care they received as children, in a tax that is used now, to pay for the care given to small children now, who will pay that debt in the future, as their tax to pay caregivers when they are adults.

    Likewise with work like caring for disabled adults, medical care, etc.

    The people doing caring work aren't freeloading, even if the direct beneficiaries can't pay on their own. And everyone benefits indirectly from their work, so it is quite just and reasonable to pay a small amount, in taxes, that is used to pay for the benefit received.

  2. Yes, very good point Ursula! A lot of people work incredibly hard without being "economically active".
    I think that in the case of parents, having a Universal Income should be sufficient; in the case of caring for an elderly relative or similar, likewise.
    I think caring for someone who is disabled is the primary exception, because that is often phenomenally expensive; however, I did neglect to note that in my post. Some equivalent of Disability Living Allowance should be in place, in addition to the Universal Income, in recognition of that fact.