Can Our Country afford the Welfare State?

Discussion in 'Bulletin Board' started by Red Rain, May 22, 2017.

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  1. Red

    Red Rain Well-Known Member

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    I have phrased the thread as a question because I do not know the answer. It is a non-political question in the sense that I have no intention of exercising my vote in this election. I am interested in what others believe and the reason that they believe it. I’ll start.


    When the Welfare State was begun, the population demographics were different to today. There were far more people paying in, and far fewer drawing out. It was a time of more or less full employment. Costs were less in the NHS, because less was technically possible. The system was designed around the tax and NI systems of the time. Sums paid in paid for the treatment and support of those in need on an ongoing basis. Individuals did not build up a fund to cover the money that they would later draw. Any reference to earnings related benefits was merely a method of calculation and not a savings pot. The system as designed all those years ago worked because it fitted the conditions and circumstances of the time. The question is whether it still works.


    Today we seems to have a larger proportion of the population drawing benefit, and a smaller proportion of the population contributing to funding. A large proportion of the population are headed for a time in their lives when they will draw more heavily on the Welfare State. Costs in the Health Service particularly are rising exponentially. Much of government borrowing is required not for infrastructure and growth, but simply to sustain the Welfare State. If the government does not reduce borrowing then interest on the National Debt increases year by year, and that debt and commitment to interest payments thereon is passed on to the next generation, who will surely blame our generation, and rightly so, for not grasping the nettle and sorting out the mess.


    The two previous paragraphs are an unbiased summary of my understanding of the current position. There is the further problem that Brexit is liable to damage, at least in the short term, the country’s wealth creation infrastructure which will surely result in difficult management issues for our economy and possibly recession. Our political leaders of all colours seem to be engaged in a relentless effort to avoid the main issues at this election and are focused on promising the voters anything, with a fall-back position of blame something/someone else later when the manure hit the air con.


    So my question is, can the Welfare State be saved, or is it doomed because we can no longer afford it?
     
    Red Rain, May 22, 2017
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  2. Redstar

    Redstar Well-Known Member

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    We CAN afford it, that is the thing. it is all about priorities.
     
    Redstar, May 22, 2017
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  3. LiverpoolRed

    LiverpoolRed Well-Known Member

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    Easily if we start cracking down on tax dodgers
     
    LiverpoolRed, May 22, 2017
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  4. Til

    Tilertoes Well-Known Member

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    And scroungers. Give the needy a better service and clamp down on the reesting fat doleys who blight the nation. A way to do this would be to have panels of 6 full time workers at a time (a bit like jury service) deciding whether they fit the criteria for benefits or not.
    At the same time, cut down on tax dodgers and that should create enough money to look after people properly when they are unfortunate enough to need it.
     
    Tilertoes, May 22, 2017
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  5. Euroman

    Euroman Well-Known Member

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    Of course we can afford it. We just need to make sure everyone who is not on PAYE pays their taxes. We are still one of the wealthiest Nations on earth. The scroungers get away with far less than the millionaire tax dodgers and hardly have a comfortable life style.
     
    Euroman, May 22, 2017
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  6. LiverpoolRed

    LiverpoolRed Well-Known Member

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    Tiny percentage of the welfare budget - between 70-80% is spent on the elderly as it should. Drop in the ocean compared to tax avoidance
     
    LiverpoolRed, May 22, 2017
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  7. red

    redrum Well-Known Member

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    Some amendments are needed instead of just taking from the people who want to get on in life yet some never come off government handouts.
     
    redrum, May 22, 2017
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  8. Gally

    Gally Administrator Staff Member Admin

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    Well it's certainly increased over the last century or so! :)

    The Huge Growth of 20th Century Social Spending
    Public spending for “Social Protection” started at 0.7 percent of GDP in 1900 and has now reached over 15 percent of GDP.

    [​IMG]
    Chart 2.25: Social Spending 1900-2020

    At the beginning of the 20th century, government spent about 0.7 percent of GDP on social protection, almost entirely social assistance or welfare, slowly increasing spending to 1.38 percent of GDP at the outbreak of war in 1914.

    Social spending exploded after World War I, peaking at 2.2 percent of GDP on welfare in 1922 and 2.25 percent on pensions in 1921. Pensions slowly decreased over the next 20 years to 0.4 percent of GDP by the end of World War II. But welfare payments declined only to 1.9 percent of GDP in the mid 1920s before jumping up to 2.4 percent of GDP after the General Strike in 1926. The Great Depression provoked a further increase in welfare payments, up to 3.66 percent of GDP in 1933. Thereafter, welfare payments declined to about 1.5 percent of GDP in the middle of World War II.

    After World War II welfare payments jumped sharply to 3.2 percent of GDP in 1948 before declining back to about 3 percent of GDP for most of the 1950s. But welfare started increasing by the late 1950s reaching 4.0 percent of GDP by 1962. Pensions hit 2.2 percent of GDP right after World War II and slowly increased in the 1950s, reaching 3.1 percent of GDP in 1961.

    Welfare payments grew steadily throughout the 1960s, breaching 5 percent in 1966, and 5.4 percent in 1968. Pensions continued a steady growth, reching 3.9 percent of GDP by 1968.

    Welfare started out the 1970s at at 5.35 percent of GDP in 1970 and then hit 6 percent of GDP in 1974 and continued to increase through the inflation and strikes of the late 1970s hitting 7 percent of GDP in the recession of 1981. Pensions started out the 1970s at 3.8 percent of GDP and steadily increased thereafter, hitting 4 percent of GDP in 1973 and 5 percent of GDP in 1981.

    In the Thatcher years of the 1980s welfare increased by the mid 1980s to 7.4 percent of GDP by 1984 before declining to 6.4 percent of GDP by 1989. Pensions peaked at 5.05 percent of GDP before declining steadily to 4.2 percent of GDP by 1990.

    Starting in 1993 with the new HM Treasury PESA, welfare, including unemployment, social security, incapacity and housing allowances, pegged at 8.25 percent of GDP; pensions came in at 5.28 percent of GDP.

    Following 1993, welfare started a decline, reaching down to a low of 5.5 percent of GDP in 2002. In the financial crisis of 2008 it increased, reaching 7.8 percent of GDP in 2010. Welfare is expected to decline to 6.6 percent of GDP by the mid 2010s.

    Following 1993, pensions began a steady increase, reaching just under 6 percent of GDP in 1998, breaching 7 percent of GDP in 2001 to peak at 7.28 percent of GDP in 2002. In the mid 2000s pensions modestly declined down to 6.68 percent of GDP in 2007. But the financial crisis boosted pension costs up to 8 percent of GDP in 2010 and 8.8 percent of GDP for 2013.

    The Growth of Major Spending Programs
    Defence spending, after the World Wars has declined; social spending is up.

    [​IMG]
    Chart 2.26: Major Spending Programs

    At the start of the 20th century the largest spending program was defence, at under 4 percent of GDP. Next came education at 1.4 percent GDP. All other public spending in the UK was about 8 percent of GDP.

    After the huge bulge in defence spending in World War I when it peaked at 47 percent GDP, defence settled down to about 2.5 percent GDP between the wars. But education spending now stood at 3 to 3.5 percent GDP, health care spending increased from 0.4 percent GDP in 1920 to 1.75 percent GDP in 1939; pensions went down from 2.25 percent GDP in 1921 to 0.7 in 1939. Welfare, the dole, chugged along at about 2 percent GDP in the 1920s, surged to 3.66 percent GDP in 1933 before slowly declining to 2.75 percent GDP by 1939.

    In World War II defence spending in the UK surged to a peak of 52 percent GDP in 1945 and then began a long decline after the Korean War peak of 11 percent GDP in 1952. By 1960 defense spending was down below 7 percent GDP; by 1970 below 5.5 percent GDP. From 1970 to the early 1980s defence spending fluctuated around 5.5 percent GDP, but then began a steady decline, going below 5 percent GDP in 1987, 4 percent GDP in 1993, below 3 percent GDP after 1997, below 2.5 percent GDP in 2013.

    The post World War II era saw the full flowering of the welfare state in Britain, starting with the nationalization of health care in 1948. In 1950, in descending order, education was 4.24 of GDP, welfare was 3.02 percent GDP, health care was 2.65 percent of GDP, and pensions were 2.07 percent of GDP.

    In 1960, in descending order, education was 4.06 percent GDP, welfare was 3.63 percent GDP, health care was 3.36 percent GDP, pensions were 2.87 percent GDP.

    In 1970, in descending order, education was 5.39 percent GDP, welfare was 5.35 percent GDP, health care was 4.02 percent GDP, and pensions were 3.83 percent GDP.

    In 1980, in descending order, welfare was 6.50 precent GDP, education was 5.33 percent GDP, health care was 5.05 percent GDP, and pensions were 4.68 percent GDP.

    In 1990, in descending order, welfare was 6.43 precent GDP, education was 4.31 percent GDP, health care was 4.30 percent GDP, and pensions were 4.20 percent GDP.

    In 2000, in descending order, pensions were 6.73 percent GDP, welfare was 6.05 percent GDP, health care was 5.08 percent GDP, and education was 4.37 percent GDP.

    In 2010, in descending order, health care was 7.79 percent GDP, pensions were 7.76 percent GDP, welfare was 7.38 percent GDP, and education was 5.90 percent GDP.
     
    Gally, May 22, 2017
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  9. Til

    Tilertoes Well-Known Member

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    The elderly should be looked after properly as payment for their past contributions to the country. Levi, Tyrone and shazzer have offered diddley squat and never will apart from a belly full of arms and legs every 9 months.
     
    Tilertoes, May 22, 2017
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  10. Jimmy viz

    Jimmy viz Well-Known Member

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    Yes we are one of the richest countries on earth.


    Sent from my iPad using Barnsley FC BBS Fans Forum
     
    Jimmy viz, May 22, 2017
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  11. Sco

    Scoff Well-Known Member

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    Whichever side of the argument you are on, the underlying reason for the opening of borders and increasing immigration was to increase the number of working-age people and the number of children coming through. We've got nearly 10 million going to retire in the next 10 years. We can either pay much more tax each, or have more people paying tax. Of course, we should have spent some of the extra tax money to pay for the infrastructure to support the extra population.
     
    Scoff, May 22, 2017
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  12. ark

    ark104 (v2) Well-Known Member

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    That doesn't sound like an expensive system to administer
     
    ark104 (v2), May 22, 2017
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  13. Til

    Tilertoes Well-Known Member

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    Or made it harder for people to choose a life on the dole. Never mind though I'm currently at work doing my 13th 12 hr night on the trot to pay for your pals to scrape themselves out of bed around 2 tomorrow afternoon to call for a greggs on the school run. Hopefully they'll get shunted by a car doing 2 mph then it's whiplash claims for them and their 8 mini me's and a new zafira while their dad they never see burgles my house while I'm on nights.
     
    Tilertoes, May 22, 2017
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  14. Jimmy viz

    Jimmy viz Well-Known Member

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    Is their one piece of sad ill informed prejudice you missed out tiger? Nothing to say about Latvians or lesbian donkeys?


    Sent from my iPad using Barnsley FC BBS Fan Forum mobile app
     
    Jimmy viz, May 22, 2017
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  15. Euroman

    Euroman Well-Known Member

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    You sound a bitter man?
     
    Euroman, May 22, 2017
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  16. Til

    Tilertoes Well-Known Member

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    I tend to believe what I see and not what a bunch of complete strangers on eye watering wages topped up by even more expenses tell me what I should see
     
    Tilertoes, May 22, 2017
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  17. Til

    Tilertoes Well-Known Member

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    Or woman
     
    Tilertoes, May 22, 2017
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  18. Sco

    Scoff Well-Known Member

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    You are probably over the limits on the working time directive for consecutive nights worked and the average length of the night shift.
     
    Scoff, May 22, 2017
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  19. Jimmy viz

    Jimmy viz Well-Known Member

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    Jimmy viz, May 22, 2017
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  20. Til

    Tilertoes Well-Known Member

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    So she was genuinely ill?
     
    Tilertoes, May 22, 2017
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