A lot of what we assume about universal benefits is just wrong

8:39 am - June 5th 2013

by Sunny Hundal    

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A few months ago I pointed out that when it comes to controversial issues such as immigration, people don’t pay attention to facts and evidence. They only remember and listen to emotional arguments that fit their views. I came under a lot of criticism, mostly from lefties who said we must appeal to evidence and facts or we have nothing.

But this debate over social security and universal benefits illustrates that even politically-engaged people don’t care much for evidence either.

The key principle that underpins most leftwing views on social security goes like this: ‘Universal benefits are worth protecting because they maintain broad support in the welfare state’.

For example, Peter Hain said this the other day:

if middle Britain ceased to benefit from the welfare state through some of the few universal benefits that are left, how can we convince them to fund the larger part of that budget through their taxes?

Owen Jones too has said a similar argument:

Stripping the welfare state of its universalism will breed a middle-class that is furious about paying large chunks of tax, getting nothing back and subsidising the supposedly less deserving. It will accelerate the demonisation of the British poor.

Both these claims are constantly made across the left… and both are wrong.

It’s important to explain why they’re wrong because I want Britain to have a strong, well-funded social security system. But for that we need to focus less on arguments that sound good to us and more on how Britons behave and react to public policy.

Here’s the problem: there is no evidence to support the view that middle class taxpayers will happily subsidise the ‘less deserving’ if they get universal benefits themselves. You can offer them universal childcare or universal winter fuel allowance or universal education, but it doesn’t mean they will be more willing to subsidise unemployment benefits for example.

So even as overall spending on social security has risen over the last 50 years, and universal benefits have been expanded, support for some types of benefits has continued to fall

Exhibit 1

Exhibit 2: Percentage prioritising specific areas for extra spending (BSA) (via Daniel Sage)

These charts show that people are more nuanced than we think. They support the specific benefits they get and drop support for benefits they don’t get. As spending on benefits for pensioners has risen, so has support. But support for the ‘less deserving’ continues to fall.

This leads me to two conclusions:

First, we should absolutely support some universal benefits (health, social care, pensions etc) – but accept that not all benefits need to be (or can be) universal. Therefore, cutting one doesn’t necessarily mean support in universalism is undermined. In other words we can be as nuanced as the public themselves.

Second, we need to push a social security system that focuses more on universal services than cash benefits. As I’ve said before, our aim should be to restructure the state to reduce inequality, not rely on small handouts to wealthy pensioners in the hope it buys support for other benefits such as for the unemployed. The cash handouts only increase support for… those cash handouts. They don’t increase support for univeral social security more broadly.

The public’s attitude towards social security is changing, and if we want to maintain universalism we have to understand that and change our approach accordingly.

Just sticking to soundbites that aren’t backed up by evidence doesn’t help us in our goals. That said, I’m betting that most lefties will ignore my appeal to the evidence base and choose to stick to emotional arguments that have always appealed to them. In that sense they’re simply doing what the broader public do.

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About the author
Sunny Hundal is editor of LC. Also: on Twitter, at Pickled Politics and Guardian CIF.
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Reader comments

1. B Corbett

Pensions should return to the original, 1906, age (= 80).
Pensions should be set at min wage level – and not a penny more in any other benefit.
Pensions should be paid in 10% pa increments from age 70, so retirement takes a decade, not a weekend.

Child Benefit, designed to encourage breeding to supply soldiers for a putative WW3 in the 1960’s should be ended – in its entirety and a limit placed on all housing (etc) benefits based on numbers of children:
a) Capped at two children
b) All children born more than 9 months after first claiming benefits are ignored completely.

We then move on to other major savings:
ALL schools charge fees – with scholarships for the top 50%, which means entrance tests for all and awards given for more than just academic success.
Education vouchers for all, meaning many more private day-schools are set up
Abolition of LEAs – which do nothing useful that the market could not, unaided, do by itself

All those paying High-Rate Tax receive no State provision of services whatsoever – that means no ‘free’ State education, NHS, Soc Ser – nothing.
In exchange ALL costs associated with private provision for Health, Education (etc) are fully tax-deductible, thus taking an entire class of society out of State concerns (and costs).
That is then extended (in, say, 2020) to all those paying Standard Rate tax too, meaning that the NHS and State Education is provided ‘free’ only to those who are on benefits or on State Pensions.

We’ve this cut the Welfare State down by 90% and made it, for once, truly affordable – bribing people with money their grand-children’s lives will be taxed to pay for, is simply insane.

This thinking has come a long way since the strong arguments in this very forum arguing that a rationed (ie means-tested) service is a run-down service. Are you sure you’re not being drawn into some sort of desperate Labour groupthink? How much will really be gained, who will lose out and what are the political aims here?

Why is this the issue, not Trident, tax reform, corruption?

Policy formulation by opinion poll instead of persuading the electorate that the opinions they have formed from the right wing press may be wrong. Wouldn’t it be wonderful if politicians actually put some bloody work in, no wonder they’re held in such contempt when their policies change with the wind. I have never seen the Labour party more spineless and pointless than it is now

A) Once you argue that some benefits should be economically targeted via a means test (rather than conditional on circumstances that might include economic circumstances – and that is a bigger difference than it sounds) then exactly why should any welfare be universal? If it is right to target winter fuel payments to those who need it, why not let the wealthy sort out their own pensions, education, healthcare, etc? A lot of them do anyway (just as some donate their WFP to charity). I think those with “emotional” arguments on the left have a very clear and convincing answer to that question, but I’m interested to hear yours.

B)There is an odd preoccupation with the psychology of the rich in this debate and considerably less about the psychology of the middle and poor. When I received unemployment benefit, I did not feel grateful that some wealthy taxpayers were paying for my (meagre) lifestyle; it fuelled neither deference to the state nor to the rich, because this was a benefit to which I was entitled and to which we should all be entitled in the circumstances that we lose our job. In that respect it is a UNIVERSAL social insurance policy and one into which I happen to have paid quite a lot since that 6-7 month period. Universality is often misunderstood – we don’t all get quadruple heart bypasses from our universal health system, but none of us have to pay for one should the need arise!

“Support for” various payments is an odd measure – nobody really “supports” JSA payments because they either want full employment or are evil. Same with housing benefit, or income support – I would much rather see affordable housing and decent wages than housing benefit and income support. There are other things that we do “support”, because we’re all likely to be ill at some point, and get old.

The case for continuing to let Richard Branson donate his Winter Fuel Payment to charity is not one in the interests of Richard Branson, nor of his chosen charity, but for the millions of pensioners who this proposed change would not materially effect at all. Because once this change has come in, then it will be the “handout” you refer to in your article, pyschologically a million miles away from the current payment.

More Red Tory than Phillip Blond.

“The key principle that underpins most leftwing views on social security goes like this:

‘Universal benefits are worth protecting because they maintain broad support in the welfare state’.”

Says who?

Universal benefits are worth protecting because means testing is costly and is proven to deter those who would benefit most.

So if people don’t broadly support, then give them no choice and tax them more.

“…most leftwing views…..For example, Peter Hain said this….”

Peter Hain – left wing? The Work and Pensions Secretary, who resigned after police launched a criminal investigation into his failure to declare donations to his unsuccessful Labour deputy leadership campaign?

7. the a&e charge nurse

If policy was based on opinion polls hanging would have been brought back some time ago.

To my mind evidence should equate primarily to measurable outcomes, or to a certain extent what might be the case if certain policies are changed.

In many cases there is little in the way of gold standard evidence whenever we investigate complex phenomena like the NHS, or education, because there are just too many variables likely to subvert any findings – I mean its hard enough to compare one drug with another once you understand how many pitfalls can arise during the research process.

Anybody who wishes to discuss evidence has to go beyond opinion polls – Ben Goldacre is keen on this approach when it comes to evaluating teaching methods.

Sunny: “That said, I’m betting that most lefties will ignore my appeal to the evidence base and choose to stick to emotional arguments that have always appealed to them. In that sense they’re simply doing what the broader public do.”

I don’t dispute that there’s no evidence people are more likely to support means-tested benefits when they receive universal benefits. It may even make them more likely to think means-tested benefits are too generous because they see themselves receiving generous benefits.

I just don’t think that’s the point. The argument Ed Balls was making to justify these cuts was about overall spending – i.e. maintaining austerity to cut the deficit, a policy which does not work, in the event they win. Labour have clearly decided to jump back on the austerity bandwagon, just as most of the world is jumping off it.

9. Merrymaker

Is the NHS a ‘benefit’? I ask because I do not think the public see it that way. The state provides a number of public services – health, law and order, fire and rescue, education, local government services, the military. These are mostly paid for by national taxation. Whilst the portion of GDP devoted to these services is subject to political dispute, these is no serious arguement that they should not be a universal entitlement. I would further argue that the OAP is not generally seen as a benefit, rather it is a universal entitlement directed at a sub population (the elderly). These services are irrelevant to the case for universalism.

10. David Moss

Yes, and it’s not just that people can discriminate between the handouts they get and the benefits that others get, it’s also that i) they don’t view their own things (winter fuel allowance, free bus pass etc.) as ‘benefits’, ii) they can distinguish between deserving and undeserving cases, hence even people who are themselves claiming jobseeker’s allowance can still insist that while they deserve it, all the “scroungers” don’t.

Not giving benefits to the affluent probably won’t have much impact on attitudes, but insofar as it reduces the total benefits bill, it might even contribute to improving attitudes.

11. Bunnyrunner

Ah…Utopia, if only.
My problem is not the loss of universality, it’s the control of it. Governments come and go and as sure as eggs is eggs one of them will seek changes in the name of economy.
Proof? Well we’ve watched on for three years as our current leaders have cut everything to the bone and then sold the bones.

@Merrymaker – so is the definition of a “benefit” a service that you don’t agree with?

13. Stuart White

Interesting post, Sunny, but doesn’t the evidence to hand also include comparative, cross-national studies of welfare states? Specifically, if we were to look at comparative levels of support for, say, the unemployed, in more or less universalist welfare states, what would we find? I think it is the cross-national comparisons that underpin a lot of the left’s argument for universalism (which is not to say your ‘time series’ approach is irrelevant).

14. Merrymaker

@ Duuncan
No not at all. I was trying to point out that not all services are seen as ‘benefits’ by the public at large. The discussion about universalism often slips into the prospective endangerment of the universalism of the NHS, or of the OAP. But I consider this to be false. I think what the public see as ‘benefits’ are rather specific payments to people to assist with problems of the here and now. Let us accept the universalism of health etc, and focus discussion on the universalism of payments – because that is what means testing is about. To me universalism of payment should continue (no means test), but should be matched by universalism of taxation. I get WFA, it should be taxed.

I wouldn’t specifically tax your WFP, but I’m guessing I would tax you more! 😉

Okay – get your point. That might well explain the difference in public attitudes, although I think the difference between a service and a benefit is actually quite slight (and a pension seems to veer into the latter rather than the former?)

Sunny, your argument ignores the effect of massive propaganda from successive governments and the right wing media pushing the scrounger/benefit fraudster rhetoric. Surveys have also found that people who are against the less popular areas of welfare eg unemployment, tend to over-estimate the amounts people receive.

Let’s imagine a strange world where governments and media only peddle facts instead of hysteria. Imagine if as much effort went into publicising how much the middle classes receive from welfare compared to the unemployed and/or poorest. About how small the proportion of spending lost to fraud is. If the results above remained the same you’d have a point. That you have these results in the world we have now when only a small proportion of activists on the left, are pushing the arguments for universality is hardly surprising. Absolutely no-one has pushed such arguments to the mainstream.

I’m not sure where you get the idea that universal benefits have expanded over the last 50 years. The main arguments for universality are pragmatic ones i.e. where the payments are relatively small and the extra costs of means testing makes it, if not actually uneconomic, barely worthwhile. This currently only really applies to Child Benefits and the WFP. Add in the issue that there always seems to be a massive problem with take up of means tested benefits among the old and the argument for keeping it universal becomes very strong.

What happens when a future politician decides they want to make a severe cut?

I’m not even talking about what Duncan is talking about- the barter market of sentiment, rhetoric and principle where “if you say this is ok, then the same thing to a greater degree becomes more palatable”.

I’m talking about the actual systematic means. Balls proposed making a significant legislative intervention in order to secure what is a relatively small budget cut. Having enabled means testing in the statutory instrument for Winter Fuel Allowance though, it does not require a future Secretary of State to go to Parliament to secure that statutory instrument in order to make a cut of hundreds of millions by denying a much lower threshold for eligibility by means testing.

He is prepared to sacrifice part of the legislative foundations for this benefit in return for an insignificant and temporary gain in publicity and political flim-flam. His quality and his character can be measured indefinitely by this.

18. MarkAustin

@1. B Corbett

Could you please explain how your “other three proposals” will save a penny. All you are doing is transferring the spending from the state to the individual (or more likely an insurance company or similar). It is all but imposssible to make savings without stopping doing something: which will not happen under your proposals, so the net economic benefit will be, at best, zero.

I can see that restricting pensions/child benefits wil, as it involves a state retreat, but even there the so-called savings will be far less, as private insurance/pensions will step into the breach.

Hi Stuart! Specifically, if we were to look at comparative levels of support for, say, the unemployed, in more or less universalist welfare states, what would we find?

Possibly, but the problem is that we have to take into account factors such as the culture, the media environment, the economic situation etc.

We’d need some form of opinion poll that focuses entirely on whether people support specific benefits, and then compare that with whether universal benefits increased or decreased during that time.

Boy how Labour has died… better not pay it benefits though like lets see MP’s getting £68,000 and wanting £100,000.

Sounding more and more like the Tories daily with Wallace and gromit type politics

21. John B. Egan

I had hoped that the Britain I grew up in hadn’t fallen for the “Leftie” crap that we have to put up with here in the USA. Throwing perjoratives into an article demeans the author and is only accepted by the very people the author berates : “They only remember and listen to emotional arguments that fit their views.”

Andy: Let’s imagine a strange world where governments and media only peddle facts instead of hysteria.

It is indeed a strange world… because it doesn’t exist.

I don’t deny the pernicious effect of the right wing press…. but remember that there’s been 80%+ support for the NHS despite their continual attack on public services.

We can’t just wish away the media. We have to create services that people love and cherish DESPITE the rightwing press.

Sunny, the whole point is that some benefits are universal for a number of reasons, not least of which is take up. There is nothing wrong with the principle that we pay into a system when we can and take out when we need. Whether or not people agree with it or not, I cannot see a principled objection to a (rich) pensioner paying into a system for forty years and getting WFA for the last thirty or so years of their lives. The principle behind like Child benefit being universal despite income levels meant money went to the mother, irrespective of what her husband earned. Are we really so blind to the concept that a man can be rolling in it and the ‘wifey’ at home could be living on next to nothing?
There are some things we should be able to defend based on our principles, or are they to be abandoned, rather than defended?
So at what point do the Left abandon opposition to racism? Or do we just deport/lock up without trial people who the public turn against? Let us say that, in some point in the future, say 60% of the public want a Muslim who offends the American (republican) president of the day, by condemning a drone attack that kills thirty children. Do we abandon our principle for free speech, just because we cannot convince 11% of people that we need to defend people who we do not agree with?

You make the case that because we cannot convince decent people the principle of universal benefits, therefore we must convince the Left that the original objective of designing universal elements must be wrong. Well isn’t that the Left up and down? No wonder the Left have became a navel gazing, internalizing group who only ever speak to themselves. Are you suggesting we never engage the public on any issue that we are at odds with? This is why the Left is fucked, Sunny, this is why this Country is going down the plughole. The principles that formed the post war settlement are being rolled back and millions of people are suffering and the Left are not prepared to tackle the Right’s lazy assumptions and outright lies. While the Right are pumping out crap about lazy benefit claiment, we are fucking about,talking to ourselves about what shelf a chemistry set should be on. Half a million people using food banks, and we worry about about things that do not matter to anyone outside our little supper clubs. People are killing themselves rather than become homeless and the Left are moaning about make up sets for ten year old girls, Sunny. This is what we have become, yes men for the Right and the silly little fuckers who find my little pony sexist.

Nothing worth fighting for? Nothing worth getting into the public domain and engaging the general public that we are correct? You would not accept such defeatist attitude on a whole raft of subjects, from racism to gay marriage, so why pick out this one to sell too easy?

The Left need to strap on a pair and get onto the ideological battlefield, on subjects that actually matter to millions.

I’m right wing and I think ALL benefits should be universal, unconditional and non with-drawable.

Why? Because I believe in a small state and lower unemployment.

Benefits, are for most people a tax credit. They are therefore not a cost. Means testing adds to administration, and therefore is a cost. Means testing Child Benefit and Pensioner benefits may cut “spending” but it adds to the overall tax burden.

As a taxpayer, the amount government spends is not important. It is the overall tax burden.

For example, in which of the following scenarios is the tax burden highest?

a. The Government collects 700 billion in tax, and SPENDS 700 billion giving it back in tax credits.

b. The Government collects 100 billion in tax, which it uses to pay for services (police, schools etc) which COST 100 billion.

As a right winger, who wants a small government and a low tax burden, I want A.

So, Universal Benefits (tax credits) is the cheapest, most efficient way of administering our tax/benefits system.

But, that’s not all. If we were to scrap tax thresholds and unemployment benefits, and replace them with a Citizens Income, not only would we reduce costs by tens of billions, we would also eliminate the marginal rate of withdrawal that is the true cause of welfare traps and unemployment.

The failure to grasp the basics of our tax/benefits system or understand the difference between costs and spending is deeply damaging for our economy and society.

All our politicians seem to care about is pandering to narrow minded ignorance for the sake of a cheap vote.

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