Blair: `We'll build a Welfare State for the 21st century'

The failure of welfare was described in graphic detail by the Government yesterday, with Tony Blair taking charge of a campaign to deliver more help to the poor, while the well-off provide more help for themselves. Anthony Bevins, Political Editor, analyses the latest `Case for Welfare Reform'.

A package of seven welfare reform focus files yesterday described the problem with a welfare benefit system that, as the Prime Minister told the Cabinet, was no longer working.

"We are a party committed to social justice and yet there is more poverty and social division coming out of the current system, as well as a growing cost to ordinary taxpayers," he told his colleagues before embarking on his first roadshow meeting, in the West Midlands, to make a personal case for change.

The latest fact-packed dossier updates information last presented to the country in 1993 by Peter Lilley, the Tory social security secretary, in a document called, "The Growth of Social Security".

In that paper, Mr Lilley called for "constructive national debate" on how to improve help for the vulnerable, while keeping the system affordable.

This time, however, Mr Blair is determined to see reform through, modernising the Welfare State just as he modernised the Labour Party - applying "traditional values in a modern setting".

Yesterday's "Case for Welfare Reform" said: "Our aim is to build a Welfare State fit for the 21st century, which extends opportunity and security to all."

But the principles laid down by Lord Beveridge, founder of the modern Welfare State in 1948, would remain central.

"Society has a responsibility to help people in genuine need, who are unable to look after themselves; individuals have a responsibility to help provide for themselves when they can do so; work is the best route out of poverty for people who are able to work."

The only addition to the Beveridge outline was that, fraud and abuse, now estimated at pounds 4bn a year, or enough to build 100 hospitals, "should be minimised and rooted out wherever found".

A "focus paper" on the evolution of social security quoted from the original Beveridge White Paper of 1942, saying: "Social Security must be achieved by co-operation between the state and the individual... The state, in organising security, should not stifle incentive, opportunity, responsibility; in establishing a national minimum, it should leave room and encouragement for voluntary action."

But it said that in the last 50 years there had been more than 120 Acts of Parliament. "Some of the changes have been piecemeal and as a consequence, inconsistencies and illogicalities have arisen."

Almost a third of Government spending goes on benefits, and over the last 20 years there had been a significant shift in spending on lone parents; there had been a strong growth of housing benefit; and benefits for the sick and disabled had been one of the fastest growth areas.

Meanwhile the number of pensioners had grown, but their share of spending had fallen - though it still accounts for a third of all welfare expenditure.

Within that statistic, however, the gulf between rich and poor pensioners had widened dramatically. The focus file on pensioners' incomes said that between 1979 - when Margaret Thatcher first took office - and 1995-96, national average earnings had increased by 38 per cent, while pensioners' incomes had risen by 64 per cent.

But that average concealed different experiences for the rich and poor. "The incomes of the poorest 10 per cent of pensioners have grown by 31 per cent in real terms since 1979. The richest tenth saw a larger real increase of 78 per cent."

The two-nation gulf is also disclosed in other areas, with a polarisation between "work-rich" and "work-poor" families in which no parent works. The number of completely workless households had doubled to 3.4 million since 1979.

But society as a whole has also become less equal and the rise in spending had "failed to banish poverty".

"Between 1979 and 1996 an extra pounds 43bn was spent on social security yet: overall numbers on low incomes grew - [more than] one in four people live on less than half average income today compared with under one in 10 in 1979 (income after housing costs); 32 per cent of children (4.2 million) in 1994-95 lived in a household below half average income, against 10 per cent in 1979; in 1979, the bottom 40 per cent of individuals held 24 per cent of national income; today they hold about 20 per cent."

Setting out the principles for the first phase of reform, the Government said: "We want the debate to be based on facts, without scaremongering. Our aim is to fight poverty, not increase it; narrow social division, not widen it; and extend opportunities, not deny them."

l Free copies of the focus files from the Department of Social Security on 0181 867 3201.

Leading article, page 20

My aims: the text of the prime minister's speech

The following is an edited extract of the Prime Minister's speech on "Building a Modern Welfare State", made to a meeting of Labour Party members in Dudley Town Hall, West Midlands, last night.

"My aim is to build a consensus for modernising social security. Tonight, I want to tell you why I am so passionate about this issue and why I believe the system must be improved if our country is to become the beacon to the world I spoke of at conference last year. All my political life I have been guided by these core beliefs: individuals achieve more together than they can alone; rights and responsibilities go together; every individual, no matter what their background, should be given the chance to succeed.

"This idea of community, of a decent society, is at the heart of my ambitions for this country. That is why it is at the heart of the party's new Clause Four. It makes me want to reform the welfare state, and deliver the social justice to which we are all committed. It is a central plank of building a modern Britain.

"The reform of our welfare state is not to betray our core principles of social justice and solidarity. It is to make them live, breathe and work again for the modern age. Over the last 18 years we have become two nations - one trapped on benefits, the other paying for them. One nation in growing poverty, shut out from society's mainstream, the other watching social security spending rise and rise, until it costs more than health, education, law and order and employment put together.

"When I look at the welfare state, I don't see a pathway out of poverty, a route into work or a gateway to dignity in retirement. I see a dead end for too many people. I do not believe this is how Attlee or Beveridge intended things to be. I want to clear the way to a new system. Long-term, thought-out, principled reform is the way forward.

"To those who doubt we should do it; to those who believe it is too risky, too tricky, or even unnecessary, I say examine the evidence.

"With your head, I ask you to look at the facts. With your heart, I ask you to look at the current suffering. Then tell me the status quo is an option."

Mr Blair said the costs of welfare, now at pounds 80 for every family per week, was alarming, and change was essential. "But any change we make will be made on principle: and the first of these is that all those in genuine need will always be helped and supported by this Labour government.

"That is my guarantee to you as leader of the party. It is the guarantee to the people who elected me as their prime minister. The state pension will remain the foundation for security in retirement. Those of working age who through illness, disability or caring responsibilities cannot work will always be protected by a Labour government. Second, work is the best route out of poverty for those who can work. Third, we believe in the responsibility of individuals to help provide for themselves where they can do so.

"These are the original principles of Beveridge. But today's welfare state is simply not true to those principles. It is not supporting many in genuine need. It is not helping all those into work who can work. It is not encouraging personal responsibility. And there is too much fraud."

Mr Blair said it would take time to get the long-term architecture right.

"But even if the rewards come in the next century, with the welfare state put on a sound, modern footing for future generations, then it will have been worth the argument and the controversy. This government will listen. But do not be in any doubt of my determination to see this through.

"No one with a shred of compassion would say we should not protect the vulnerable. But no one with a degree of common sense would say the present system should remain untouched."

Start your day with The Independent, sign up for daily news emails
There will be a chance to bid for a rare example of the SAS Diary, collated by a former member of the regiment in the aftermath of World War II but only published – in a limited run of just 5,000 – in 2011
charity appealTime is running out to secure your favourite lot as our auction closes at 2pm tomorrow
Arts and Entertainment
Mark Wright has won The Apprentice 2014
tvThe Apprentice 2014 final
Arts and Entertainment
X Factor winner Ben Haenow has scored his first Christmas number one
Have you tried new the Independent Digital Edition apps?
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Elton John and David Furnish exchange marriage vows
peopleSinger posts pictures of nuptials throughout the day
Arts and Entertainment
James May, Jeremy Clarkson and Richard Hammond in the Top Gear Patagonia Special
File: James Woods attends the 52nd New York Film Festival at Walter Reade Theater on September 27, 2014
peopleActor was tweeting in wake of NYPD police shooting
Claudia Winkleman and co-host Tess Daly at the Strictly Come Dancing final
peopleLiam Williams posted photo of himself dressed as Wilfried Bony
Martin Skrtel heads in the dramatic equaliser
SPORTLiverpool vs Arsenal match report: Bandaged Martin Skrtel heads home in the 97th-minute
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Recruitment Genius: Telesales & Customer Service Executives - Outbound & Inbound

£7 - £9 per hour: Recruitment Genius: Are you outgoing? Do you want to work in...

Recruitment Genius: National Account Manager / Key Account Sales

£30000 - £35000 per annum: Recruitment Genius: An opportunity has arisen for a...

Recruitment Genius: Operations Manager

£30000 - £35000 per annum: Recruitment Genius: An exciting opportunity to join...

Recruitment Genius: Recruitment Consultant

£30000 - £35000 per annum: Recruitment Genius: We have an excellent role for a...

Day In a Page

The week Hollywood got scared and had to grow up a bit

The week Hollywood got scared and had to grow up a bit

Sony suffered a chorus of disapproval after it withdrew 'The Interview', but it's not too late for it to take a stand, says Joan Smith
From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?

Panto dames: before and after

From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?
Thirties murder mystery novel is surprise runaway Christmas hit

Thirties murder mystery novel is surprise runaway Christmas hit

Booksellers say readers are turning away from dark modern thrillers and back to the golden age of crime writing
Anne-Marie Huby: 'Charities deserve the best,' says founder of JustGiving

Anne-Marie Huby: 'Charities deserve the best'

Ten million of us have used the JustGiving website to donate to good causes. Its co-founder says that being dynamic is as important as being kind
The botanist who hunts for giant trees at Kew Gardens

The man who hunts giants

A Kew Gardens botanist has found 25 new large tree species - and he's sure there are more out there
The 12 ways of Christmas: Spare a thought for those who will be working to keep others safe during the festive season

The 12 ways of Christmas

We speak to a dozen people who will be working to keep others safe, happy and healthy over the holidays
Birdwatching men have a lot in common with their feathered friends, new study shows

The male exhibits strange behaviour

A new study shows that birdwatching men have a lot in common with their feathered friends...
Diaries of Evelyn Waugh, Virginia Woolf and Noël Coward reveal how they coped with the December blues

Famous diaries: Christmas week in history

Noël Coward parties into the night, Alan Clark bemoans the cost of servants, Evelyn Waugh ponders his drinking…
From noble to narky, the fall of the open letter

From noble to narky, the fall of the open letter

The great tradition of St Paul and Zola reached its nadir with a hungry worker's rant to Russell Brand, says DJ Taylor
A Christmas ghost story by Alison Moore: A prodigal daughter has a breakthrough

A Christmas ghost story by Alison Moore

The story was published earlier this month in 'Poor Souls' Light: Seven Curious Tales'
Marian Keyes: The author on her pre-approved Christmas, true love's parking implications and living in the moment

Marian Keyes

The author on her pre-approved Christmas, true love's parking implications and living in the moment
Bill Granger recipes: Our chef creates an Italian-inspired fish feast for Christmas Eve

Bill Granger's Christmas Eve fish feast

Bill's Italian friends introduced him to the Roman Catholic custom of a lavish fish supper on Christmas Eve. Here, he gives the tradition his own spin…
Liverpool vs Arsenal: Brendan Rodgers is fighting for his reputation

Rodgers fights for his reputation

Liverpool manager tries to stay on his feet despite waves of criticism
Amir Khan: 'The Taliban can threaten me but I must speak out... innocent kids, killed over nothing. It’s sick in the mind'

Amir Khan attacks the Taliban

'They can threaten me but I must speak out... innocent kids, killed over nothing. It’s sick in the mind'
Michael Calvin: Sepp Blatter is my man of the year in sport. Bring on 2015, quick

Michael Calvin's Last Word

Sepp Blatter is my man of the year in sport. Bring on 2015, quick