The Benefits System is a Joke

The image appeared in my Facebook feed with the quiet fury of a woman who had just discovered that the welfare state had not been secretly mirroring her payslip.

Redundant from a £60k job, she declared the benefits system a joke.

I ventured what I thought was a perfectly pedestrian remark. Jobseeker’s Allowance and Universal Credit are a safety net, not income replacement. That is not ideology. It is the operating manual.

This was apparently incendiary.

The comments gathered with pitchfork efficiency. How could £400 a month possibly be a safety net? £400, I pointed out, is roughly the standard allowance for a single adult. It is not designed to sustain a middle-class lifestyle. It is designed to prevent you starving while you look for work.

This clarification did not calm matters. It merely shifted the outrage from “the system is rubbish” to “£400 is insulting”. At this point several people proposed that benefits should replace 80 percent of previous income, then taper gently down. A sort of state-funded glide path back to professional life.

All very sensible sounding. Entirely feasible. Provided one also supports significantly higher National Insurance contributions to fund it. Which is where the conversation developed a sudden allergy to detail.

Here lies the inescapable conclusion. If you want earnings-related unemployment insurance at meaningful levels, you must collect meaningful contributions during employment. Countries that do this have higher payroll taxes. This is not controversial. It is arithmetic.

British voters, however, have spent several decades reliably rejecting parties that propose higher taxation. They are extremely keen on well-funded public services, generous income protection, modern infrastructure and Scandinavian outcomes. They are markedly less keen on Scandinavian tax rates.

So we are left with the current arrangement. A modest safety net. Thin by continental standards. Cheap by continental standards. Entirely consistent with the tax levels the electorate repeatedly chooses.

The woman on £60k was not wrong to find £400 alarming. Anyone would. But the system did not malfunction. It delivered exactly what the country has collectively paid for.

There is something faintly heroic about demanding champagne while steadfastly voting for tap water. It is a very British form of optimism.