Government and Institutions

Welfare state ‘not fit for purpose’, poll reveals


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IEA releases a new report on a federal Britain

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The IEA launches a major new five-year project Initiative opening paper.pdf
An opinion poll conducted for the IEA by ComRes shows the British public overwhelmingly feel little influence over government decision-making:

•           Over three quarters (77%) of the British public feel they have not very much influence, or no influence at all on the UK government’s decision-making;

•           Half of Britons (50%) think that the level of influence governments have over people’s lives is too high;

•           Three fifths of Britons (59%) believe the welfare state is ‘not fit for purpose’;

•           Fewer than one in ten believe politicians make decisions based on what’s best for the country (8%) or their constituents (6%);

•           Four in five agree that too often laws and regulations fail to achieve what they are meant to (80%), or that laws and regulations often create new problems even if they are introduced with good intentions (79%).

This polling was carried out on the eve of the launch of the Institute of Economic Affairs’ new Paragon Initiative – a major five-year project to determine the changes needed in the way we are governed to produce better outcomes today and in the future, with a vision of a country where people have greater control over their lives.

In a paper introducing the project, it is argued that the current framework of UK government is failing to provide high living standards, high quality public services and good social outcomes.

The huge growth in government over recent decades has led to demonstrably poor outcomes in public services – the UK ranks only 20th out 24 OECD countries on cancer survival rates; 6 million people are living in workless households; 40% of children are failing to achieve the minimum standard of GCSE grades; and politicians have run deficits in 52 of the last 60 years. This is unacceptable.

Our current political establishment allows the better off to get on, but is failing the poor through complexity, monopoly and a lack of competition in the provision of public services. Meanwhile, our welfare system is failing to help those most in need.

Why the current model of government is failing and unsustainable:

·         Government expenditure is too high. As a proportion of GDP, the government spent more last year than in any year between 1947 and 1979 – the supposed post-war big government era. This kind of poor financial management is unsustainable in the face of an ageing population. The public recognise this: 61% believe the welfare state as we know it today won’t exist in 50 years’ time.

·         Complexity and a lack of competition in public services. Many UK services are run as near-monopolies. Government policies in different areas have conflicting objectives, a lack of external performance comparisons, and a lack of competition meaning there is no threat of customer loss or bankruptcy.

The public is more amenable to different forms of provision than politicians believe. Two thirds of Britons (65%) say that the most important consideration for public services should be quality. Fewer than one in ten (9%) believe that who public services are run by (i.e. whether a private company or the state) should be the most important consideration for public services.

·         Over-centralisation prevents experimentation and direct accountability to end users of services. Too much power is centralised in Westminster – less than 5% of overall government tax revenue is now raised at a local level, compared to nearly 50% in Canada and over 30% in Germany.

Britons don’t feel influential at any of the levels of government tested: three quarters feel they have little or no influence over decisions made by their local council (73%) and by the UK government (77%); four in five feel they have little influence over decisions made by the European Union (81%), including 57% saying they have no influence at all.

–           A welfare state that fails the poorest. The UK system has made the disadvantaged dependent on taxpayer generosity and is failing those most in need. Centralised welfare provision is not responsive to diverse needs, and means-tested welfare now interacts with the tax system to create marginal rates as high as 80%, deterring progression in work. Three quarters of the public (75%) believe that the welfare state requires substantial reform to cope with challenges such as an ageing population. Just a quarter (25%) of Brits believe the welfare state is operating effectively at present.

·         High levels of regulation. The state regulates many aspects of our lives – childcare, lifestyles, employment relationships – the number of pages of legislation passed per year has increased by a factor of 20 over the past century. The sheer volume of state activity encourages vested interests to lobby the government for special privileges and favours. The public also tends to see policy-making as biased, with three quarters (74%) agreeing that often politicians propose new legislation to favour certain groups.

Recognising this, over the next five years the Paragon Initiative will map out a new vision for government in Britain. It will:

·         Review every major current function of government, examining the problems and failures of current government activity.

·         Draw on international best practice and acknowledge future challenges to outline effective alternative means of the function being delivered, whether that be within the public sector or otherwise.

·         Outline practical steps to get closer to the ideal means of delivering the function. Where appropriate, this will include pilot schemes for testing and evaluation.

·         Develop a constitutional framework, to ensure that well-functioning government will be maintained after the reforms are implemented, beyond the reach of vested interests.

·         Propose a new approach for politicians to manage effectively the operations which constitute the core business of government

Commenting on the launch of the Paragon Initiative, Mark Littlewood, Director General at the Institute of Economic Affairs, said:

“For too long, people have accepted mediocrity with a government monopoly as they don’t know anything different. The public clearly believe that the politicians are acting in their own interest, at the expense of what’s best for the families up and down the country. The Paragon Initiative aims to challenge the status quo, with the aim of having a government that’s less centralised, more responsive and more flexible to the needs of UK citizens.”

Notes to Editors:

1. For media enquiries please contact Stephanie Lis, Head of Communications: [email protected] or 0207 799 8900 or 07766 221 268.

2. To download the full opening paper of the Paragon Initiative, click here.

3. The launch of the Paragon Initiative takes place tonight, from 7.00pm at the Churchill War Rooms. Guest speakers include John McTernan, former Director of Political Operations to Tony Blair and the Rt Hon Dr Liam Fox MP. For more information please contact Stephanie Lis, as above.

4. THE PARAGON INITIATIVE is the IEA`s biggest-ever research programme. Across the next five years, we`ll:

• Analyse the failure of current polices through a far-reaching series of nearly 50 books and papers scrutinising every area of government activity

• In late 2015, we’ll publish peer reviewed works on devolution, the structural flaws in the NHS, privatising the railways and labour market regulation

• They’ll be quickly followed by works on the future of the BBC, a free market alternative to the NHS and the damaging effects of migration controls

• Later in 2016, we’ll investigate child care, the state of social housing, government funding of the arts and more

• All backed by a co-ordinated and comprehensive programme of stimulating events, compelling ieaTV films and targeted communications reaching policymakers, practitioners and opinion-formers

5. The first Paragon Initiative research paper, Federal Britain, will be published next Wednesday 4th November.

6. To view a short video about the Paragon Initiative, click here.

7. Methodology of ComRes poll – ComRes interviewed 2,068 British adults online between 21st and 22nd October 2015. Data were weighted to be representative of all adults in Great Britain aged 18+. ComRes is a member of the British Polling Council and abides by its rules. For further detail, full polling tables can be found here.

8. The mission of the Institute of Economic Affairs is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems. The IEA is a registered educational charity and independent of all political parties.