The Classic Welfare State was initiated by the Labour’s Beveridge Report which aimed to eliminate the ‘five giant’ towards post-war reconstruction[1].

This essay will argue to a small extent the classic Welfare State promote a more egalitarian society. It is because cost and benefit were not often equally shared under the system, within difference socio-economic groups (SEGs), throughout the classic era (1945-1975). A welfare state is based on government’s expenditure; citizens thus can enjoy an equal outcome from it[2]. For example, citizens pay the tax for the NHS and the rich and the poor could receive same level of treatment[3]. In this essay, egalitarian is considered as each individual contributes the same weight of cost and they should acquire the same level of benefit[4]. However, in the classic era costs were not shared but carried mainly by the poor; meanwhile the benefits were distributed unevenly between different SEGs. Despite the society as a whole were benefit from a higher standard of housing, people who are more affluent had benefited from a regressive tax level, further education and better quality of healthcare treatment.

Taxation is the way in which government can influence individual welfare and it did not balance cost to a significant extent throughout the Classic era[5] The income tax, as a direct taxation, had become more regressive. Between 1955 and 1974, the percentage of tax raised from firms was dropped for about 75%[6]. A bachelor could have retained £3587 in his £10,000 earning in 1949; by 1974, £6088 can be retained[7]. Thus, the redistribution from the rich to the poor was not substantial comparing the beginning and the end of the classic era[8]. In contrast, the government revenue became more relying on the poor, partly because of the inflation. Even a married worker with two children was liable to tax in mid 1970s[9] and they suffered from the highest marginal rate of taxation[10]. In here we might see that direct taxation had been eroded by more regressive base.

Together with indirect taxation which pays for the welfare, we should discover the nature of wealth distribution and how much did it share peoples’ cost[11]. The rich, for example the managers could enjoy various subsidies. They were increasingly benefiting from, for instance free medical insurance, use of company car, and top hat pension[12]. Moreover, during 1950s the national pension might no longer supported by a flat-rate contributions. Thus the Labour party developed a new pension scheme featured the earnings-related benefits[13]. However, according to Halsey, the wealth inequality was actually decreased between 1961 and 1976 by taxes when taking Gini coefficient into accounts.[14]. We might argue that the regressive taxation led to an uneven share of cost in short term; in the other hand the gap was actually closing in a very gradual manner.

There used to be an egalitarian vision of a shared housing benefit from Bevan, the Minister for Health, ‘where the doctor…and the farm labourer all lived in the same street…(as a) mixed community.’[15]. To evaluate how egalitarian society was achieved, we might consider the quantity and quality of housing available to different SEGs. For the poor who need to rent out, the Conservative government had set and achieved the goal of building 300,000 council housing per year in 1953 and 1954[16]. Between 1945 and 1964, there were averagely 158,000 public houses being built every year[17]. In the other hand, housing had switched to high-rise tower rather than council housing. This might be seen as a tradeoff of quality for quantity. Those towers were criticized for its lack of consideration in community sense and create barriers to residents’ interaction[18] as well as for its low quality[19]. Surprisingly, the overall standards of amenities such as WC in-house did undergo an increase, despite property owner could enjoy consistently higher than household which rent from a private person[20]. Interpretation behind could be both working and middle class were taking advantages from the state intervention; while perhaps those live in the tower suffer more.

The state did relieved people from squalor to some extent. However, there was a fluctuation to the extent of a shared benefit. Pressures were put by the Conservatives on local authorities to raise rents, which affected the low-income most[21]. Also, the government actively encouraged people to be a property-owner[22] thus the tax relief granted in this respect had reached £2341 million which was about £900 million more than on subsidizing the social housing[23]. Tax relief to property owners such as the Schedule A tax, had benefited the richest landlord to a substantial proportion[24]. In late 1970s, income group who earned £6240 or more had taken 70% more public expenditure than those who earned less than £2080[25]. Although the poor had taken up more of the subsidies for council tenant than the rich, the higher income group had substantially owning more properties thus acquired considerable granting on this respect as well[26]. Thus this essay argues that under the welfare state, every class could enjoy benefits to some extent so everyone was the winner. This did promote a more egalitarian society.

The NHS was initiated by the Labour government after WWII, promising people that they ‘may get the best that modern science can offer’ including hospitals, doctors and nurses[27]. However both health and healthcare were unable to be distributed equally from the NHS but largely benefiting the rich. It was found that the higher the patients’ SEGs belong to, the longer consultation time doctor would spend on them[28]. Whereas the patients from lower SEGs tend to receive a lower level and less frequent consultation or treatment despite their demand was higher in certain aspect, for instance hip replacement[29]. Furthermore, infant mortality and stillbirth rate of lowest SEG was the highest[30]. According to Hill’s statistics, the welfare state had failed to tackle this class inequality in distribution of health, but had worsened the situation instead[31].

The HNS expenditure per unit of need is rather unequal. Le Grand argued that the upper two SEGs had consumed at least 40% more expenditure than the lowers by using data in 1972[32]. However, the study of O’Donnell and Propper claimed that in fact the poor people acquired more healthcare than the rich by measuring the frequency of visiting GP[33]. They were aware of the methodology used by others such as Le Grand’s work; and the use of 1980s, in the age of Thatcherism, data might further reinforce the argument that poor was benefiting more from the NHS. However this essay had argued that the rich were taking advantages from a longer consultation time as well as the standard of treatment. In general Hill had presented that the higher the patients’ socio-economic group belongs to, the more the health care system would spend[34]. To sum up, the better-off had obtained more benefits, including health and healthcare from the system.

In 1944 education had essentially meant ‘equality of opportunity’ and ‘parity of esteem’ implied the equal distribution of resources[35]. However the opportunity of pupils from higher social class was greater than their fellow students. The streaming of children was depended on the 11-plus exam which measured the IQ of pupils; and this was found in favouring the middle-class and the professionals group[36][37]. Apart from examination, parental factor also played a part. As working class family might not recognize the benefit behind further education, while perhaps the father did not receive much, so the money forgone from being hired might perceived as more costly than continuing education[38]. Moreover, the resource available for children was significantly unequal. According to Hart et al, there was a positive relationship between the amount of books at home and income[39]. As a result, working class found it hard to move upward in the social ladder, and the situation had actually worsened in the classic era[40]. It was not hard to argue that the benefit for education was mainly occupied and consolidated only by the better-off.

Considering expenditure used, the higher SEGs had acquired more resources in higher education. Le Grand had demonstrated that in late 1970s, the richest fifth of household received about 150% more public expenditure than the poorest counterpart[41]. If we measured by occupation, the expenditure enjoyed by a professional was in fact lower than a unskilled labour in primary school age; but the situation reversed in and after secondary school and the former could enjoy 50% more than the latter[42][43]. It might because of the higher possibility for a high social class pupil to enjoy university life than a working class[44]. Although the imbalance in the input of expenditure did not create a more egalitarian society, it was notable that there is no controversy here to put more resources on those might be the future professional and help sustain the states prosperous. The poor pupils did benefit from the state in early school age, and the data from 1970s suggested an unchanged inequality among social class.

To conclude, to a large extent the British welfare state in 1945-75 did not create a more egalitarian society. This was because the cost and benefits of the welfare state were not equally shared among different socio-economic-groups. The wealthier and higher SEGs could have enjoyed a lower responsibility in contributing to the state by an increasingly regressive tax base; as well as taking advantages on higher level of healthcare and health, and further education. In general everyone perhaps were benefited from the state in housing, as public housing and private market had both received certain grant and help. This essay had argued that an egalitarian society could not be achieved by a base built on over-dependence and exploitation on the poor. However, the essay had only discussed the issue on very few topics, a further research on pension or transportation could be done. Also, the previous argument is mainly focused on wealth and its relationship to equality, the argument on gender or race could help broadening the discussing into different respect.

 

Bibliography

Archive of Labour Party Manifestos, 2001, 1945 Labour Party Election Manifesto, Retrieved January 26th, 2015 from: http://www.labour-party.org.uk/manifestos/1945/1945-labour-manifesto.shtml

Fraser, D., 2009, The Evolution of the British Welfare State, Fourth edition, Basingstoke: Palgrave Macmillan, p298

Greener, I., Simmons, R., Powell, M., 2009, The Consumer in Public Services: Choice, Values and Difference, Bristol: Policy Press

Halsey A.H., Heath A.F., Ridge, J.M., 1980, Origins and destinations: family, class and education in modern Britain, Oxford: Clarendon Press, p188

Halsey, A.H., 1988, British social trends since 1900: a guide to the changing social structure of Britain, Basingstoke: Palgrave Macmillan

Harrison, R., 2009, Towards an archaeology of the welfare state in Britain, 1945–2009. Archaeologies, Vol.5(2), pp238–262

Hart, R., Moro, M. and Roberts, J. 2012, Date of birth, family background, and the 11 plus exam: short– and long–term consequences of the 1944 secondary education reforms in England and Wales, Stirling Economics Discussion Paper, no.2012(10),p3, 4

Hill, M., 1993, The Welfare State in Britain: A Political History Since 1945, Aldershot: Edward Elgar, p37

Jenkin, P., 1980, Black Report 4 The Evidence for Inequality in Health Service Availability and Use, Retrieved January 26th, 2015 from:  http://www.sochealth.co.uk/resources/public-health-and-wellbeing/poverty-and-inequality/the-black-report-1980/the-black-report-4-the-evidence-for-inequality-in-health-service-availability-and-use/

Le Grand, J., 1978, The distribution of public expenditure: The case of health care, Economica, Vol.45, p132

Le Grand, J., 1982, The Strategy of Equality, London: George Allen & Unwin

Le Grand, J., 2012, Inequality, choice and public service, in A. Giddens and P. Diamond, (eds), The New Egalitarianism, London: Policy Network

Lowe, R., 2005, The Welfare State in Britain since 1945, Third edition, New York: Palgrave Macmillan

Malpass, P., 1990, Reshaping Housing Policy: Subsidies, Rents and Residualisation. London: Routledge.

O’Donnell, O. and Propper, C., 1991, Equity and the distribution of UK National Health Service resources, Journal of Health Economics, Vol. 10(1), p9

Peter Scott, ‘The Household Economy since 1870’ in R. Floud, J. Humphries and P. Johnson, (eds.), The Cambridge Economic History of Modern Britain, Volume II 1870 to the Present, Cambridge: Cambridge University Press, 2014

Rubinstein, W.D., 1986, Wealth and Inequality in Britain, London: Faber and Faber

Sinfield, A., 1966, ‘Poverty, privilege and welfare’, in P. Bean and D. Whynes (eds), Barbara Wootton: social science and public policy: essays in her honour, London: Tavistock, p112

Stanford Encyclopedia of Philosophy, 2013, Egalitarianism, Retrieved January 25th, 2015 from: http://plato.stanford.edu/entries/egalitarianism/

Titmuss, R.M., 1962, Income Distribution and Social Change, London: George Allen & Unwin Ltd., p129

 

FOOTNOTES

[1] Harrison, R., 2009, Towards an archaeology of the welfare state in Britain, 1945–2009. Archaeologies, Vol.5(2), pp239

[2] Le Grand, J., 1982, The Strategy of Equality, London: George Allen & Unwin, p14, 15

[3] Le Grand, J., The Strategy, p15

[4] Stanford Encyclopedia of Philosophy, 2013, Egalitarianism, Retrieved January 25th, 2015 from: http://plato.stanford.edu/entries/egalitarianism/

[5] Peter Scott, ‘The Household Economy since 1870’ in R. Floud, J. Humphries and P. Johnson, (eds.), The Cambridge Economic History of Modern Britain, Volume II 1870 to the Present, Cambridge: Cambridge University Press, 2014, p366

[6] Lowe, R., 2005, The Welfare State in Britain since 1945, Third edition, Palgrave Macmillan: New York, p297, 298

[7] Rubinstein, W.D., 1986, Wealth and Inequality in Britain, London: Faber and Faber, p82

[8] Halsey, A.H., 1988, British social trends since 1900: a guide to the changing social structure of Britain, Basingstoke: Palgrave Macmillan

p147, 152

[9] Scott, The Household Economy, p367

[10] Lowe, The Welfare State, P297, 298

[11] Sinfield, A., 1966, Poverty, privilege and welfare, in P. Bean and D. Whynes (eds), Barbara Wootton: social science and public policy: essays in her honour, London: Tavistock, p112

[12] Sinfield, Poverty, privilege and welfare, p113

[13] Fraser, D., 2009, The Evolution of the British Welfare State, Fourth edition, Basingstoke: Palgrave Macmillan p298

[14] Halsey, British social trends, p154

[15] Hill, M., 1993, The Welfare State in Britain: A Political History Since 1945, Aldershot: Edward Elgar, p37

[16] Fraser, The Evolution, p295

[17] Hill, The Welfare State, p51

[18] Harrison, Towards an archaeology, p4

[19] Hill, The Welfare State, p51

[20] Halsey, British social trends, p380

[21] Malpass, P., 1990, Reshaping Housing Policy: Subsidies, Rents and Residualisation. London: Routledge

[22] Greener, I., Simmons, R., Powell, M., 2009, The Consumer in Public Services: Choice, Values and Difference, Bristol: Policy Press, p138

[23] Halsey, British social trends, p376

[24] Titmuss, R.M., 1962, Income Distribution and Social Change, London: George Allen & Unwin, p129

[25] Le Grand, J., The Strategy, p88

[26] Le Grand, J., The Strategy, p88

[27] Archive of Labour Party Manifestos, 2001, 1945 Labour Party Election Manifesto, Retrieved January 26th, 2015 from:http://www.labour-party.org.uk/manifestos/1945/1945-labour-manifesto.shtml

[28] Jenkin, P., 1980, Black Report 4 The Evidence for Inequality in Health Service Availability and Use, Retrieved January 26th, 2015 from:  http://www.sochealth.co.uk/resources/public-health-and-wellbeing/poverty-and-inequality/the-black-report-1980/the-black-report-4-the-evidence-for-inequality-in-health-service-availability-and-use/

[29] Le Grand, J., 2012, Inequality, choice and public service, in A. Giddens and P. Diamond, (eds), The New Egalitarianism, London: Policy Network

[30] Jenkin, Black Report 4

[31] Hill, The Welfare State, P419, 421

[32] Le Grand, J., 1978, The distribution of public expenditure: The case of health care, Economica, Vol.45, p132

[33] O’Donnell, O. and Propper, C., 1991, Equity and the distribution of UK National Health Service resources, Journal of Health Economics, Vol. 10(1), p9

[34] Le Grand, The Strategy, p26

[35] Lowe, The Welfare State,P215

[36] Hart, R., Moro, M. and Roberts, J., 2012, Date of birth, family background, and the 11 plus exam: short– and long–term consequences of the 1944 secondary education reforms in England and Wales, Stirling Economics Discussion Paper, no.2012(10), p3,4

[37] Lowe, The Welfare State,P228

[38] Le Grand, The Strategy, p63

[39] Hart, Moro and Roberts, Date of birth, p37

[40] Le Grand, The Strategy, p76

[41] Le Grand, The Strategy, p57

[42] Halsey, British social trends, p293

[43] Le Grand, The Strategy, p58

[44] Halsey A.H., Heath A.F., Ridge, J.M., 1980, Origins and destinations: family, class and education in modern Britain, Oxford: Clarendon Press, p188

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