Sam Royston, Broken Benefits

Sam Royston, Broken Benefits: What’s gone wrong with welfare reform, Policy Press, xii + 387 pp, 1 4473 3326 5, pbk, £15

This book might be better described as a library than as a book. That is not a criticism. The book is timely, detailed, well researched, and well written: not an easy combination to achieve in relation to the UK’s benefits system.

Part I is introductory. It summarises the book’s message – the high cost of the system; its insufficient support for working families; its dysfunctional administration; and the fact that contributory benefits, far from representing insurance-based provision, can actually leave people worse off. Then follows a history of social security benefits in the UK, which demonstrates how the Beveridge Report really did give birth to a ‘British revolution’ – that is, a revolution containing lots of continuity – as well as claiming that it did. Royston then suggests what benefits are for: providing a safety net; increasing equality between households facing different circumstances; and promoting socially desirable behaviour, particularly in relation to work – here meaning employment.

Part II is a detailed exploration of the UK’s benefits system. Part III explains recent changes: cuts, freezes, caps, an exacerbated couple penalty, and declining incentives to seek employment; and it finds that pensioners are treated far better by the system than working families. Part IV is well described by its title, ‘Chaos, error and misjudgements’, and is a detailed discussion of sickness and disability assessments, benefits sanctions, changes to state pension age, and the now localised Council Tax Reduction, and particularly the way in which such localisation makes a coordinated policy over marginal deduction rates impossible to implement. Part V studies longer term trends, and finds significant impacts on poverty rates, living standards, household debt, health, education, homelessness, housing security, social isolation, employment incentives, and the complexity of benefits.

The final part of the book suggests a number of changes that would give us ‘better benefits’, with the suggestions categorised under the different purposes of the benefits system outlined at the beginning of the book. In order to prevent poverty and destitution, some of the changes made to Housing Benefit and to benefits for people affected by disability or ill health will need to be reversed, the use of sanctions will have to be scaled back, waiting periods will have to be reduced, and a national crisis loan scheme will have to be reintroduced. In order to respond to household need, benefit caps will need to be reviewed, and changes will be needed to Pension Credit to fill the gap between working life and an increasing state pension age. In order to support socially desirable behaviours, employment must pay, so the ‘cliff edges’ of the benefits system will need to be removed, work allowances and not tax allowances will need to be increased, and couple penalties will need to be removed. The final substantive chapter asks that changes should not leave people worse off, and that changes should be understood. Royston sums up his prescription like this:

Alongside work to rebuild the safety net; respond flexibly to differences in household need; and more consistently promote socially desirable behaviours, we also need to reform social security in order to make it simpler from the perspective of the claimant. Addressing these four areas together could help to fix our broken benefits system. (p.345)

The concluding chapter emphasises that there is more than one goal for the benefits system, that cuts can cause inefficiency, that economic inequality matters, that National Insurance Contributions should count for something (so National Insurance benefits should not be reduced pound for pound when means-tested benefits are claimed), and that ‘simplifying the benefits system shouldn’t be the goal – simplifying it for the claimant should be’ (p.350). True: but it is also true that a simpler system would be easier to understand.

Royston has fulfilled admirably the agenda that he set himself: that is, not to reform the benefits system, but to make the system work better than it does. It is never the task of a reviewer to criticise an author for not writing the book that the reviewer would have liked to see written: so what this review needs to say is the Royston’s book should be taken as a model of careful detail, and that anyone who proposes genuine change to the benefits system should take the kind of trouble over the detail that Royston has taken. But having said that, it also has to be said that Royston’s approach to the reform of the benefits system is insufficient. The world has changed since Beveridge wrote his report in 1942, yet we are still trying to make work a system designed for the 1940s. More radical change is surely required: and once a new trajectory has been decided upon, each step of the transition will need to be subjected to the kind of examination to which Royston has subjected today’s creaking benefits system.