Letter: Welfare reform

Sir: The debate about delivery of universal benefits to the affluent raises a question. Will a government which has the courage to seek an integrated transport policy also have the stamina to address that other holy grail, the amalgamation of the tax and benefits systems?

A system whereby individuals hold a lifelong account with the state into which they pay when they are able and from which they draw as they need would obviate the distortions of the current parallel systems and offer a more subtle set of policy levers than is currently available.

For example, an individual's account might be debited for routine health services such as dental or eye care, but not for the potentially bankrupting treatment of acute or chronic illness. A variety of means might be available to credit an individual's account. A graduate seeking employment could gain credit against her student loan by undertaking voluntary work, whilst a middle-aged person might gain credit against her own pension by caring for an elderly relative and thereby saving the state a substantial sum.

A new mechanism for the financial relationship between individuals and the state is a prerequisite for a stakeholder society.

JIM TOOHILL

London SW4