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We've got a problem. Having been through a huge crisis where the welfare state was centre stage, our debates on where next for social security are stuck. An immediate policy row about the £20 UC uplift or utopian plans for an entirely new Universal Basic Income are all we've got
Instead we should be asking what the past year has taught us about the UK's welfare state? And where should those lessons point us in terms of future reforms? Those are the big questions we focus on in today's @resfoundation think piece. Some highlights... https://www.resolutionfoundation.org/publications/in-need-of-support/
Some lessons are clear: our sick pay system is a joke, our welfare state must be able to cope with different forms of work and introducing huge new schemes quickly is hard (it can be done but means accepting very rough edges and fraud). But 3 bigger lessons stand out for me...
First: our welfare state does far too little by way of insurance ie if you're unlucky enough to lose your job your income falls A LOT. This is why we had to introduce the Job Retention Scheme in a matter of weeks (it protect 90% of family incomes vs 50% in the benefits system)
Second: the basic minimum safety net has just become too mean after years of cuts. Pre-crisis 1-in-4 families on UC had reduced their food intake/changed meal patterns because of a lack of cash. That's why the Chancellor had to temporarily boost UC by £20 a week
Third: costs matter - especially housing and children. Our crisis response recognised that on housing but ignored kids (following a pattern of recent years with cuts to support). The result? 1/2 of children in large families now live in poverty.
Lots of policy proposals flow from these lessons - bringing with them costs and trade-offs. That's what we should be debating.
For under £1bn a year you could provide 3 months of proper earnings insurance for those losing their jobs - paying 80% of previous earnings so that severe hardship is avoided while people find new work. In recessions the 3 months could be longer.
Earnings insurance will mainly benefit higher earners and homeowners, so could only be prioritised within a package that also addressed the inadequate basic safety net: keeping the £20 (including for legacy benefits) would cost around £7 to £8 billion
For lots more lessons and policy options to debate read the full report from @MikeBrewerEcon @karlhandscomb & Krishan Shah. https://www.resolutionfoundation.org/publications/in-need-of-support/
Should add: none of these big reforms are easy/straightforward/cheap. But if you're after a reason for optimism note the share of the public thinking benefits are too high is down from 60% to 34% over the past decade (big cuts will have that effect)
