Some history – The Poor law

Study VisitThe history of back-to-work VET in EnglandBen Neildb.neild@exeter.ac.uk Marchmont Observatory / SLIM

Under the Old Poor Law, ‘paupers’ were hired out as cheap labour. But there were fears that this ‘outdoor relief’ undermined the free market; drove down wages and made poverty inevitable; undermined the resilience of the independent Labourer.New Poor Laws (1834) – Governed by 2 principles:1) “Less Eligibility” - conditions in the workhouse should be worse than those experienced by the poorest 'free' worker, outside the workhouse 2) “Workhouse Test” - ‘relief ‘should only be available in the workhouse. The workhouse should be so awful, that anyone who can cope outside the workhouse would not choose not to be in one. Some history – The Poor law

1911 - National Insurance (NI) was introduced. Employers would buy ‘stamps’ and stick them in a ‘contribution card’. This card entitled employees to unemployment and sickness benefits.This was a contributory insurance. Benefits were paid for a maximum of 1 year, and only to those who had paid National insurance. There was no support for those on low incomes. Social Security How is it paid for? There was also 2nd scheme, for pension contributions. 1948 – Introduction of ‘Welfare State’. One single National Insurance contribution. Introduction of benefits for people on low incomes, paid to people who had not paid NI. This ‘income support’ was also received by people who had paid NI, but who were no longer entitled to unemployment benefit, because they were claiming for more than one year.

National Insurance still exists:Employees pay c.12% of earned incomeEmployers pay c. 13.8% of salary costsAlthough it ‘entitles’ you to claim certain benefits, it is NOT YOUR MONEY. It is not in an account with your name on it. It is in a general pot. Politicians who are frightened of raising income tax or corporation tax, have often raised National Insurance instead. There is not much difference between the two.The Coalition Government is conducting a consultation on integrating national insurance and income tax.UK system based on entitlements to support from central government and individual responsibilities. Social Security How is it paid for?

Up until 1996, unemployment benefit was still seen as an ‘entitlement’, based on contributions. Income support, was ‘means-tested’, there to support people with low income levels. 1996 sees the introduction of Job-seekers Allowance (JSA). This is a contract between the individual and the state. At your ‘New Jobseeker interview’ you sign an agreement covering:- How many companies they will telephone / visit each week- The maximum journey time to a potential employer for work- How you will use newspapers, websites etc to find vacancies - That you will not work for more than 16 hours a week, while looking for permanent employment. After this, you must go to your local Jobcentre Plus office every two weeks to ‘sign on’ and demonstrate what you have been doing to find work. If you fail to look for work, or fail to take looking for work seriously, your benefits can be cut or stopped. Jobseekers Allowance

£51.85 for people under 25 £65.45 for people over 25‘Contribution-based JSA’ is paid for 6 months to people who have contributed enough National Insurance. After that, there is ‘Income-based JSA’, which is means tested. If your partner works or you have savings over £16,000, you get nothing. You are also entitled to housing benefit, extra income support (if you have children), you get free school meals, medicines etc. You have these rights as long as you meet your responsibilitiesUnless you are really incapable of work, labour market policies are ‘active’ and the benefits your receive are conditional on you meeting your responsibilities. (‘Conditionality’). Jobseekers Allowance Payment Rates

“How does the UK compare in terms of its endorsement of Work First strategies, based on a mutual obligations approach?The answer is that the UK is at the vanguard of radical activation policies.Only Australia and certain US states have gone further in terms of pushing people back into work in order to decrease the welfare rolls.”Active labour market policies in international context: what works best?Lessons for the UK: Anne Daguerre with David Etherington, 2009 Active labour market policy

Public attitudes remain quite punitive

Activation of ‘incapacity benefit’ claimants There are many more people on Incapacity (sickness) Benefit than Jobseekers Allowance (unemployment benefits)

Work Capability Assessment • The old ‘inactive’ Incapacity Benefit has been replaced by a ‘Employment & Support Allowance (ESA). People who apply for ESA must undertake the Work Capability Assessment - a points based assessment, across 22 areas, e.g. reaching, memory, cognition • Is unaware of own behaviour to the extent that he / she frequently causes distress to others = 6 points • Cannot pick up a 1 litre carton of liquid with either hand = 9 points • Score less than 15 points, you can look for work and move to Job Seekers Allowance • Score more than 15 points and you are in the ‘Work Related Activity Group’ and get extra help. • Examples of criteria for being in the ‘Support Group’, who have no obligation to look for work are: • Cannot rise from sitting without help / cannot wash without help • Cannot understand a simple task, such as preparing a hot drink

Work Capability Assessments – results of tests on new (ESA) claimants

Benefits can be cut for a number of reasons. 1) Not looking for a job seriously2) Deliberately losing a job, after you have found one3) Not taking part in Mandatory activities. April 2011 - Mandatory work scheme, obligatory unpaid work for up to four x 30 hour weeks August 2011 – Mandatory Skills development, a policy to make sure that claimants who have a skills need ‘that is preventing them from getting and keeping a job, take the necessary steps to address that need as part of their journey back to work’Jobcentre Plus advisors refer JSA claimants to training provider and can withdraw their benefits if they don’t participate, though this is rarely used. ‘Conditionality’

Thank YouBen Neildb.neild@exeter.ac.uk Marchmont Observatory / SLIM

Some history – The Poor law