Universal benefits and spending priorities

Universal benefits and spending priorities

18th September 2013

Nick Clegg has been a prominent critic of giving welfare benefits to wealthy pensioners. Indeed, as recently as June, the Deputy Prime Minister said that “I don’t think you can have a debate about welfare that is provided to people at the bottom, if you’re not prepared to have a debate on the welfare that is provided to people at the top”.

There seems little to disagree with in this view. As the Centre for Social Justice (CSJ) has long argued, it is strange for the state to continue to provide this array of benefits to pensioners and the better off, irrespective of income.

But Clegg’s announcement yesterday that Free School Meals (FSM) will be given to all children in reception, year one and year two undermines this principle.

This pledge, which will cost an estimated £600m, is flawed and unjustifiable in the current climate.

There are a number of problems:

  • It is not designed to help the poorest children because most already receive FSMs.
  • Like Winter Fuel Payments and Free Bus Passes, much of this new universal benefit will go to families who don’t genuinely need it.
  • In the current economic climate, when budgets for the poorest are being squeezed, public spending has to be about priorities. Children and families trapped in poverty should of course be first in line for support – this middle-class giveaway misses the point.
  • The amount of support schools get from the pupil premium will go down. If registration for FSMs drops because parents see that their children are automatically getting meals, then schools – particularly schools in poorer areas – will find it even harder to close the attainment gap between richer and poorer pupils.

Here are several ways £600m could have been put to better use:

  • Instead of giving FSMs to all children aged 5-7, this money could have been spent on the poorest school children across the age scale.
  • More money could have been invested in Universal Credit to increase the taper rate, thus improving the overall generosity to poorer families.
  • The money could have been used to provide FSMs to all children on Universal Credit. Although this would include some middle-class families who would not need support, it would nevertheless be better targeted and focussed on families with lower incomes.
  • Aside from FSMs, there is one policy area that is all too often ignored – family breakdown. Investing some of this money into relationship support could go a long way to stabilising families and giving them a firmer foundation.
  • Some of the money could have been invested into the Early Intervention Grant that is given to local authorities to ensure children, young people and families facing problems get early and effective help.

Given the need and scale of the social challenges facing the poorest in our society, it is surprising that yesterday’s announcement has received such enormous backing from campaigners. In times of fiscal constraint, everything is about priorities. On this occasion, it is difficult to understand another universal giveaway.

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