Challenges to the Welfare State 1964-1979 Flashcards
What percentage of GDP were social welfare cost by 1966?
5% - continued to grow.
Why did Wilson have to raise taxes during his time in government?
To pay for this welfare spending - had promised to increase welfare spending, and discovered a £800 million deficit.
When was the National Insurance Act?
1970
What was the 1970 National Insurance Act?
Extended welfare through a package of welfare benefits.
What were the welfare benefits in the 1970 National Insurance Act?
- Gave pension rights to those not covered in the 1948 National Assistance Act
- Increased the child allowance given to mothers.
- Made rent subsidies available for low income families in private housing.
What were the increasing challenges to the Welfare state 1964-1979?
- Britain’s economic decline
- New Ideas (New Right, New economic ideas)
- Changes in attitudes (Collectivist attitudes)
What was the New Right?
A branch of political (and sociological) thinking that emerged in the late 60s/70s.
What were the ideas of the New Right?
- Advocated for a smaller welfare state
- Governments should be tougher on crime
- New economic models: free markets and minimal government intervention.
- Traditional family structures and values.
What were the reasons the New Right were critical of the welfare state?
- Welfare state had become inefficient and limited freedoms
- Welfare state encouraged inflation
- Welfare state encouraged a dependency culture.
How had the Welfare state become inefficient and with limited freedoms?
Claimed:
- Private business will always spend money more efficiently than gov. as they want profit - gov. doesn’t want profit and therefore waste as they are inefficient.
- Welfare state was restricting individual freedoms - more taxes.
How did the welfare state encourage inflation?
Claimed:
- High levels of gov. spending on WS required borrowing.
- Increased the amount of money in the economy but production and goods was not increased.
- Too much money chasing too few goods = inflation.
How did the welfare state encourage a dependency culture?
Claimed:
- Welfare encouraged people to live off benefits and not get jobs.
- This lifestyle encouraged crime and poor education which in turn leads to greater reliance on the state.
How did the consensus end?
Thatcher replacing Heath as Conservative Leader.
What were Thatcher’s ideas towards welfare?
Led a new gen of Cons who no longer believed in the PWC and felt cuts to welfare would encourage people to be less self reliant on the state.
What Labour welfare policies were passed in the 70s that Thatcher attacked in opposition?
1974 - 25% increase in pensions & freeze council house rents.
1975 - Invalid Care Allowance
1975 - Universal Child Benefit
