To be fair the ‘how much should we spend’ vs ‘what should we spend on’ should apply to the question of ‘smaller state’. Ie rather than just cutting things blithely – ie a ‘smaller budget for a smaller state’ – the questions posed should be ‘what do we think the state shouldn’t do and what should it do? – and fund them appropriately.

the questions posed should be ‘what do we think the state shouldn’t do and what should it do? – and fund them appropriately.

The question should also be asked in the format “we’ve got this much money to fund things, how can we best spend it?”. Funding doesn’t happen just by a decision, after all. Governments have more tricks up their sleeves here than individuals, but the bottom line is still the same: you cannot endlessly spend more than you are able to earn. And even trying to earn as much money as you can (regardless of consequences to yourself and others) is not always a good idea.

In the short term, it may be wise to fund some things even with debt. In the long term, always taking new debt without considering the payback is a road to what we have in Greece now (which is not fun).

I’m afraid, Don, that that reads like the tired old mantra, that’s been parroted for years (esp by ‘consultants’) of “We have to be innovative, do things differently, do more on less”. Which is trite and obvious and gets us nowhere.
The personalisation route is similar: look at socail crae where personalisation and self-directed support have been all the rage for years.
The principle is like motherhood and apple pie, nobody could ever disagree with crevices being tailored around the individual’s needs,yadda,yadda.
The reality is woefully different: personalisation ends up being marketisation, and rationing. What’s worse, is chains of accountability get stretched to snapping point, and in the drive for personalisation we’ve seen legions of intermediary advisers,brokers,and consultants taking whopping great slices. The upshot is that in many areas, people are left with less (or no) social care compared to what they had before, and middle-men have grown fat.
Be careful, very careful indeed as to what mechanism is adopted to achieve the end.

@ 3 Alisdair

“I’m afraid, Don, that that reads like the tired old mantra, that’s been parroted for years (esp by ‘consultants’) of “We have to be innovative, do things differently, do more on less”. Which is trite and obvious and gets us nowhere.”

What does? Don’s piece talks about trying to raise employment levels, and suggests policies like building more council houses. The quoted text talks, among other things, about raising employment by helping young people, disabled people, and parents find work. There’s plenty of matter along with the art.

@ Chaise (4).Should have been clearer, less concern with Don, more with Maeve (and Community Links are seen in some quarters as not that far removed from the corporate welfare dependency culture which guarantees hand outs for companies such as Atos and a4e for appallingly poor performance. mentioned by Don.
The last bit by McGoldrick says almost what I was attacking as trite:new and better ways of managing government spending. It’s not about more or less money; it should be about using the existing money more skillfully and effectively.. In the longer version she even comes out with thinking outside the box with a straight face.
Besides the issues I’ve mentioned about personalisation (andpooled budhgets) with the dismal precedents in social care, the other worrying aspect of this angle is that is uses as an implicit starting position that the jobless person is at fault for their unemployment, with efforts focused on them.
Don’s arguments are much better in terms of looking at structural factors as well.

The ancients used to tell their people “if you want to ensure the crops grow this year, you must make a blood sacrifice to the gods”. The modern civilised capitalist version is – “if you want economic prosperity, you must sacrifice your drains on society – your useless eaters, your malingerers, your lazy, feckless benefit scrounging scum, by stripping them of all their dignity and the pittance they get by on and leave them to become destitute, freeze to death in the streets and starve.

The elderly and infirm, the unemployed and the sick and disabled offered up as a blood sacrifice to the capitalist god Mammon, with the full support of the capitalist right-wing media, the red, yellow and blue Tories and the rabid, ignorant, gullible, short-sighted propagandised, brainwashed electorate, who still haven’t realised who their real enemy is and what they have planned for them.

Liam Byrne’s interview was risable, and at the risk of saying ‘i told you so’ – I told you so.

There is no great need for reinventing the wheel here. The most succesul way of reducing the welfare bill is to increase employment, which will also reduce the demand on the health service, the police and criminal justice system, and also improve educational outcomes.

Welfare reform does have a small part to play in this, although clearly wider economic factors play a more important role. So reforms do need to be made, mainly: (1) merging benefits into single fortnightly payments, (2) having a more gradual withdrawal of benefits so the system does have an incentive for people to take part time or agency work, and (3) ensuring the actual amount of money people recieve is large enough to cover living costs – as when people start to get into debt and avoid eating properly their physical and mental health suffers and it becomes more difficult for them to get a job (not to mention they use health services more and so the state saves nothing).

Furthermore we also need a system that recognises the difference between short and long term unemployment. So we need a system of essentially laissez faire conditionality for the first 6 months (although people should be able to opt into the additional support) as the vast majority find jobs within this period so there is no point clogging the system with pointless administration and alienation of people. After 6 months we give people intensive support but in return impose greater conditionality (within reason – forced labour and work placements are a no-no) and perhaps alter the housing component of the benefit to restrict excessive rent/mortgage payments (I think its reasonable to keep people in their homes who have just been made redudant even if these payments are high for the short term, but not for the long term). Groups defined as ‘vulnerable to long term unemployment’ (neets, people with no qualifications, prison leavers etc) to be fast tracked into the post 6 months group. This to only apply to people who are not disabled.

But equally the above is not as important as ensuring we have a functional economy that is not in recession.

@ 7 Planeshift

I would also add that the tax system should encourage work. At the moment you have an insipid combination where the personal allowance is low, benefits can be quite high and most importantly the rate of withdrawal of those benefits is so quick that someone newly into work can find themselves no better off thanks to a 90% ish marginal tax rate, once benefit reductions are taken into account. Its hardly an incentive to join the labour force if most of what you earn through your hard work is effectively immediately removed from you.

Agreed. Another factor to consider here is that there are numerous benefits, and often to qualify for one, you have to be in reciept of the other. So if – for example – you take a 6 week data entry job with an agency (which of course could be a stepping stone to something more – particularly if you need something new on your CV), you will be signed off all benefits. When you then finish the job you will then have several forms to fill in to reclaim your benefits, and will often face delays of a couple of months whilst the paperwork is processed (and the inevitable errors made on entitlements)- and even though you’ll get it backdated, this often means people will end up in arreas and even served notice by landlords. Not suprising that many don’t want to take the risk.

What I find odd is all this talk about “incentives” and “choosing” whether to work or live on benefits. People living on benefits have few and for the most part no choice about anything. If you refuse any reasonable offer of work on Jobseeker’s Allowance you lose your benefits, so how can any claimant “choose” between working or not working?

“If you refuse any reasonable offer of work on Jobseeker’s Allowance you lose your benefits, so how can any claimant “choose” between working or not working?”

You will notice that I wrote that I thought the wider economy was the more important factor.

But in answer to your question. The job centre simply do not know (1) whether a claiment gets a job offer, or (2) what the actual job search activity is. People are required to produce evidence of job search but somebody who really didn’t want a job could simply lie or be bad in an interview situation. The condition is thus unforceable in practice. Although I think the actual percentage of claimants who don’t want a job is less than 0.1 %

Dsquared brings up a lot of this in a recent post over at Crooked Timber.

Byrne is an a*se. He’s just perpetuating the neo-liberal agenda which has, since the 80s, been designed to transform the welfare state into a US-style workfare state. As Cylux says @1: ‘what do we think the state shouldn’t do and what should it do? – and fund them appropriately.’

Dsquared discusses, not before time, the two welfare models. One is a proper social insurance system – the Nordic model – with generous universal benefits. This is backed up by less income equality, so everybody has a stake in, and benefits from, society.

The neo-liberal model is to systematically play divide-and-rule. By withdrawing “benefits” from the middle classes, through means-testing, they create a division between “taxpayers” and “scroungers”. This is extended by playing off one part of the poor against another – the deserving against the non-deserving poor.

This is aided and abetted by parts of the media. A typical example was a live BBC interview after Miliband’s speech on the radio yesterday – where the interviewer was asking some “working class” punters about a £25k benefit cap. The response was predictable – they said that they’d be very happy to be living on £25k a year, as they’d never seen that kind of money. This was “interpreted” as continued Labour support for benefits reductions. Except that very few people receive £25k a year in benefits – and of those that do, most of that money probably goes to their landlord. The question was skewed, with predictable results.

@ Planeshift

But what about these “tough love” schemes like the Work Programme which are administered by private “paid by results” companies? They’re supposed to drive 40% or more of the long-term unemployed into sustainable work any way they can. Based on leaked information it seems that they’re only managing between to get three months or more paid work for 3% to 20% of their clients, meaning that 80% to 87% of the long-term unemployed with spend 2 years on that scheme, have less than three months paid work during that time, and leave the scheme unemployed. These people will get sanctioned if they refuse any offers of work or to carry out any “direction”, e.g., workfare, which their provider organisation considers beneficial (as a boon or as a goad) and so, if the work really was there, getting 40%+ into jobs shouldn’t be too difficult when, in point of fact, it is proving to be extremely difficult if not impossible.

Personally I don’t think that carrots like tax credits or sticks like sanctions make any real difference as far as persuading to accept, or force people into, work goes although of course things like tax credits are helpful if not essential to anybody moving into poorly paid employment.

The unemployed and the poor have no real say in anything.

That’s the bald truth.

Always has been.

The article and most of the comments are very naive, mass unemployment is essential to capitalism and the leaders of all 3 parties want to ensure that the supply of labour massively exceeds the demand to force the cost of labour down thereby pushing wages down and profitability up.
http://thetruthaboutunemployment.wordpress.com/2012/09/17/what-causes-unemployment-2/
In February 2008, when the prospect of a recession in the UK was being debated, the Daily Telegraph published a revealing interview with former City financier David Freud – who had been appointed by Prime Minister Tony Blair in 2006 to provide an “independent” review of the so-called welfare-to-work system. In the interview Freud claimed that he thought it was possible to get “about 1.4 million back to work”. By the time the final question of the interview came around he seemed to have forgotten the need to pretend he favoured an economy with lower unemployment, and when asked whether he thought there will be a recession, he replied “Yes, because we should have recessions every five or six years and we are due one”. This was one of the rare instances of a politician publicly departing from the mantra of claiming to want an economy that will produce “jobs and growth”.

“But what about these “tough love” schemes like the Work Programme which are administered by private “paid by results” companies?”

I’d scrap them at the first opportunity. Waste of money, violation of rights, and the biggest welfare fraud ever seen.

The article and most of the comments are very naive. Unemployment is essential to capitalism, the aim is to push real wages down by ensuring that the supply of labour massively exceeds the demand.

http://thetruthaboutunemployment.wordpress.com/2012/09/17/what-causes-unemployment-2/
In February 2008, when the prospect of a recession in the UK was being debated, the Daily Telegraph published a revealing interview with former City financier David Freud – who had been appointed by Prime Minister Tony Blair in 2006 to provide an “independent” review of the so-called welfare-to-work system. In the interview Freud claimed that he thought it was possible to get “about 1.4 million back to work”. By the time the final question of the interview came around he seemed to have forgotten the need to pretend he favoured an economy with lower unemployment, and when asked whether he thought there will be a recession, he replied “Yes, because we should have recessions every five or six years and we are due one”. This was one of the rare instances of a politician publicly departing from the mantra of claiming to want an economy that will produce “jobs and growth”.

We are so lucky to have all those employers desperate to employ the sick the disabled and the long term unemployed.

If more people were able to find jobs, then less money would need to be spent on support for unemployed people, because there would be fewer of them.

Except that is not the problem. The problem is that we spend so much money, finding a job is not very attractive. How are you going to solve that? The other problem is one of moral hazard. Because we reward people like Baby P’s Mother for living like Baby P’s Mother, we get more people like Baby P’s Mother. There is no longer any incentive to behave in the right way. How are you going to fix that?

If low paid workers got a pay rise, then the amount spent on tax credits would decrease.

Well no. Because there are only three ways they can get a pay rise. They can improve their productivity. Given the failures of the education system that ain’t going to happen. Competition can be reduced. But you don’t want to end immigration do you? Or we can debase the pound through inflation.

If we built half a million new council houses, then we wouldn’t need to give so much money to private landlords in the form of housing benefit.

But that will only work if the council houses are cheaper than the housing benefit. And all evidence suggests that the management of council housing is pathetic. Everyone knows that any housing turned over to the council becomes a drug-filled crime-ridden sh!thole in a matter of weeks. Which ends up costing us all more.

That’s even before we get into the corporate welfare dependency culture which guarantees hand outs for companies such as Atos and a4e for appallingly poor performance.

Atos has shown that the Social Security people have been doing an incredibly poor job. Paying Atos to do what the State couldn’t is not a bad decision.

He said he would develop childcare policies, support unemployed young people and provide more help for disabled people to work.

So spend spend and spend some more.

There is a real need for reform which is distinct from the need for a reduction in expenditure.

In other words welfare should be about the Union members who administer it, not the people who get the benefits.

Investment is needed to modernise the support services available to both unemployed people and people in low-paid employment.

A meaningless statement which probably only means they want us to spend more.

We have brought together experts from the welfare-to-work world and we’ve been briefing ministers on our personalisation agenda; an idea we believe would transform employment support services into excellent and effective provision.

In other words, they have p!ssed away billions on useless consultants. Great.

So Much For Subtlety,

You know full well that unemployment is essential to capitalism so stop trying to blame it on the welfare state.
http://thetruthaboutunemployment.wordpress.com/2012/09/17/the-reintroduction-of-mass-unemployment-in-the-1970s-80s/
In January 1943 an article in The Times entitled “Planning Full Employment” looked ahead to the possibility of a post-war economy being run in such a way that the mass unemployment of the inter-war period was eliminated. As befits The Times, the article was written from the point of view of the Establishment and candidly discussed the problems of such an approach by outlining the role of unemployment in a capitalist system :

“Unemployment is not a mere accidental blemish in a private enterprise economy. On the contrary, it is part of the essential mechanism of the system, and has a definite function to fulfill.
The first function of unemployment (which has always existed in open or disguised forms) is that it maintains the authority of master over man. The master has normally been in a position to say: “If you don’t want the job, there are plenty of others who do.” When the man can say: “If you don’t want to employ me, there are plenty of others who will,” the situation is radically altered.”

19. JobSeeker

You know full well that unemployment is essential to capitalism so stop trying to blame it on the welfare state.

Bollocks. As can be seen by the fact that unemployment is directly related to how much welfare any one country has. Hong Kong and Singapore have little of either. The US more of both, Britain a lot of both. No one has a lot of welfare and little unemployment.

In January 1943 an article in The Times entitled “Planning Full Employment” looked ahead to the possibility of a post-war economy being run in such a way that the mass unemployment of the inter-war period was eliminated.

I think you’re making that up. Quote the Times directly. Page number and all. Where’s the link?

So Much For Subtlety,

I did “Quote the Times directly”, why did you think the following appeared inside inverted commas?!!!

“Unemployment is not a mere accidental blemish in a private enterprise economy. On the contrary, it is part of the essential mechanism of the system, and has a definite function to fulfill.
The first function of unemployment (which has always existed in open or disguised forms) is that it maintains the authority of master over man. The master has normally been in a position to say: “If you don’t want the job, there are plenty of others who do.” When the man can say: “If you don’t want to employ me, there are plenty of others who will,” the situation is radically altered.”

Here`s the link, which you could have found through a device called Google!

http://sites.roosevelt.edu/glanger/jrtimes-2/

Remember when you participated in this thread in July on Tim Worstall`s webshite, which included discussion of the “Non-Accelerating Inflation Rate of Unemployment” (NAIRU)?

http://timworstall.com/2012/07/10/skwalker-1964-and-the-welfare-state/

You are clearly aware that unemployment is used to control inflation!

GOTCHA!!!!

Now pick up that white flag you keep beside you for just such occasions and wave it with all the vigour appropriate to a freshly defeated dogmatist, then give us a masterclass in contrition.

Further evidence of what causes unemployment is available here:
https://thetruthaboutunemployment.wordpress.com

Here`s the link:

http://sites.roosevelt.edu/glanger/jrtimes-2/

Here`s the link:

http://sites.roosevelt.edu/glanger/jrtimes-2/

So Much For Subtlety,

Remember when you participated in this thread in July on Tim Worstall`s website, which included discussion of the “Non-Accelerating Inflation Rate of Unemployment” (NAIRU)?

http://timworstall.com/2012/07/10/skwalker-1964-and-the-welfare-state/

You are clearly aware that unemployment is used to control inflation!