Exposing the myths about welfare

6 April 2011

Right-wing politicians and commentators make regular pronouncements about welfare. We look at its importance and bust some of the myths

George Orwell wrote in his novel 1984 about those able “to tell deliberate lies while genuinely believing in them, to forget any fact that has become inconvenient”. He could have been writing about the current welfare debate.

The myths about welfare are so pervasive and they have become the received wisdom. They are: people on welfare are mostly shirkers; the welfare state is generous; welfare is rife with fraud; and that Jobcentre Plus is ineffective at helping people back to work.

Each and every one of these statements is pure myth, yet from the pages of the tabloid press to the mouths of ministers they are perpetuated as if they were the truth.

MYTH 1. ‘People on welfare are mostly shirkers’

Last October the work and pensions secretary Iain Duncan Smith suggested the jobless in Merthyr Tydfil should “get on a bus” to Cardiff to find work. Merthyr has a very high level of unemployment with 43 people for every job vacancy. But if the town’s Unemployed were to travel to Cardiff they would be disappointed: there are already nine unemployed people for every job vacancy in the city.

People on the dole are not shirkers – they don’t have jobs because of the recession caused by the banking crisis.

Four years ago, before the banking crisis began, there were 1.69 million people unemployed, today it is 2.53 million. Is it really serious to suggest that since 2007 an extra 850,000 people have opted not to work as a ‘lifestyle choice’. To demonise the victims of the recession is one of this government’s most disgraceful attacks. Myth two explains why no one is likely to choose benefits.

MYTH 2. ‘The welfare state is generous’

David Cameron takes on Spongers’ cries the Daily Star, ‘Workshy to lose benefits’ reports the Daily Express. Even the more refined Telegraph ran the headline ‘Dependency cannot be a lifestyle choice’, while the Daily Mail combined it with its twin obsession to complain about migrants accessing ‘Britain’s generous benefits system’.

So is the welfare state generous? Jobseeker’s Allowance is currently £65.45 per week (£3,400 per year). If unemployment benefit had risen at the same rate as earnings over the last 30 years it would be worth £110 per week now. Today’s unemployed are worse off than previous generations.

Those on Employment and Support Allowance, formerly Incapacity Benefit, receive about £97 per week. According to campaigning organisation Disabled People Against Cuts, 30% of disabled people live below the poverty line.

MYTH 3. ‘Welfare is rife with fraud’

In his comprehensive spending review statement last October chancellor George Osborne said: “Nor will fraud in the welfare system be tolerated any more. We estimate that £5 billion is being lost this way each year.” After complaints, the government has now admitted the combined cost of benefit and tax credit fraud was only £1.5 billion.

A figure less widely quoted is that of the level of benefits and tax credits unclaimed: £16 billion. So for every 10p lost to fraud, over £1 is recouped by people not receiving benefits they are entitled to. And don’t forget there is a £120 billion annual tax gap from wealthy individuals and big businesses avoiding and evading taxes.

MYTH 4. ‘Jobcentre Plus is ineffective at helping people back to work’

All the evidence shows that Jobcentre Plus outperforms private contractors. These workers have years of experience and training. A recent National Audit Office report comparing contractors with Jobcentre staff found: “Contractors have universally underperformed against targets set by the department which had to make concessions as part of contractual renegotiations to support the continuation of businesses and services . . . Jobcentre Plus achieved better job outcome rates for mandatory customers compared to external providers.”

Despite this evidence, backed up by several academic studies, prime minister David Cameron announced that his new welfare scheme will be delivered by “social enterprises, charities and businesses”, with 9,000 job cuts expected in Jobcentre Plus.

Iain Duncan Smith’s Welfare Reform Bill is predicated on these myths to justify their brutal £18 billion welfare cuts.

The welfare state was set up on the basis that unemployment, ill health or even disability could affect any of us. We must defend welfare: the right to live secure and dignified lives whether in or out of work.

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