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Friday 22 August 2008

The Tories are radical again

Cameron means business on welfare: the Tories are the radicals again

David Cameron is about to take up the issue that Margaret Thatcher didn’t dare touch and that defeated Tony Blair at the height of his powers: welfare reform. Fraser Nelson explains how the Conservative leader intends to bring the American welfare revolution to this country, challenge Labour on its home turf and make poverty history in Britain.

Thompson cut benefit rates, but used the saved money to introduce new benefit schemes. Those taking work placements had their childcare and commuting costs subsidised. New demands kept being introduced. Parents, for example, would lose benefit if their child played truant — a scheme designed to stop the welfare habit being passed down the generations. There is ample scope for such demands in Britain, where one in five children lives in a household with no earned income.

The effects of Wisconsin's tough love were extraordinary. Wisconsin’s welfare rolls had fallen by 82 per cent by 2001, by which time the state had become used by the Clinton presidency as a template for America and the country as a whole had reduced its welfare recipients from 14 million to less than five million. The type of fall which ministers say is impossible for Britain had been enacted in a few years. When welfare stopped offering something for nothing, it lost its appeal. People chose work instead. Poverty rates among black children fell to the lowest since records began. Like Britain, America had declared work to be the best form of welfare. But unlike Britain, they legislated for it.

But how much of this could be imported to Britain? It is the culture, more than the size, that’s the issue. The Wisconsin project worked because it answered a clear public demand. In the past half-century, Britain’s tolerance for huge welfare spending has been greater, the stigma of accepting benefits much smaller and overall public perception of the problem generally dimmer. The Brown government’s ‘let them eat tax credits’ approach is only now beginning to come undone. Welfare reform has worked best around the world where the old system was perceived to be in crisis. Britain, alas, has lacked this sense of urgency.

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