The Second World War devastated Great Britain. The conflict decimated towns and cities, obliterated industry, and nearly half a million Brits lost their lives. The destruction of the Second World War tabled new priorities on Britain's political agenda. Healthcare, housing, education, and employment benefits were now necessary policies in post-war Britain. While there had been calls for a so-called 'Welfare State' since the early 1900s, the Second World War provided the required impetus for such policies to transpire. Let's discuss the origins, circumstances, and policies of the Welfare State and then analyze its long-standing effect on British society.
Welfare State
The welfare state is a system of government in which the state protects the economic and social welfare of its people.
The Welfare State Timeline
Below is a timeline that explains the developments and establishment of the modern Welfare State:
| Year | Event | Description |
| 1601 | Elizabethan Poor Law | Relief was given to people unable to work due to age, disability, or illness. |
| 1834 | New Poor Law | Ensured that workers were housed, clothed, and fed. Furthermore, children in workhouses received schooling. |
| 1908 | Old Age Pensions Act | Introduced pensions for over-70s. |
| 1909 | Labour Exchanges Act | Created Labour Exchanges. |
Development and Road Improvement Funds Act | Provided funds to improve and repair highways. |
Trade Boards Act | Established a minimum wage. |
| 1911 | National Insurance Act | Protected workers against loss of earnings if sick and provided unemployment benefits. |
| 1925 | Widows', Orphans, and Old Age Contributory Pensions Act | Gave pensions to over-65s and introduced widow's benefits. |
| 1942 | William Beveridge published 'Social Insurance and Allied Services'. | Coined the "Beveridge Report", it served as the blueprint for the Welfare State. |
| 1944 | Butler Act | Promised 'secondary education for all'. The Act raised the school-leaving age and implemented primary and secondary education. |
| 1945 | The Family Allowance Act | Provided child benefits to families. |
| 1946 | National Insurance Act | Provided financial protection for the unemployed and sick. |
| 1948 | National Health Service Act | Established comprehensive health care for people in England and Wales. |
The Origins of the Welfare State
The term 'Welfare State' initially described Labour's post-war social policy. However, the origins of the Welfare State date back to the early 1900s with Liberal Prime Minister Herbert Asquith's reforms between 1908 and 1910.
Fig. 1 - H.H. Asquith
Here's a brief look at the welfare policies enacted by Asquith's Liberal government:
| Welfare Policy | Description |
| 1908 Old Age Pensions Act | Provided income for the over 70s. Individuals over 70 were given 5 shillings a week, and couples over 70 were given 7 shillings 5 pence per week. |
| 1909 Labour Exchanges Act | Saw the creation of labour exchanges that were tasked with helping the unemployed find employment. |
| 1909 Development and Road Improvement Funds Act | Provided funds to construct and repair roads across the United Kingdom. |
| 1909 Trade Boards Act | Established a minimum wage for industry and low-paid workers. |
| 1911 National Insurance Act | Established unemployment benefits and sick pay. |
The Establishment of the Welfare State
After the Second World War, Clement Attlee's Labour government introduced a series of measures to tackle social inequality. These policies established the modern Welfare State in Great Britain. Such policies emanated from a wartime report on social welfare by British economist William Beveridge. Here's a brief overview of Beveridge:
- Name: William Beveridge
- Born: 5 March 1879
- Background: Trained as a lawyer before becoming a Liberal politician. In the early 1900s, William Beveridge helped Chancellor David Lloyd George establish the Old Age Pensions Act (1908) and National Insurance Act (1911).
- Why he's important: Published the Beveridge Report, which led to the establishment of the modern Welfare State.
The Beveridge Report
During the Second World War, William Beveridge headed a committee tasked with investigating social welfare in Britain. Beveridge's committee identified five fundamental problems in British society which prevented people from bettering themselves; he entitled these problems 'The Five Giants'.
The Five Giants were:
- Disease.
- Ignorance.
- Idleness.
- Squalor.
- Want.
Fig. 2 - Norwich after bombing
William Beveridge's findings were published in 1942 in a report entitled 'Social Insurance and Allied Services'. The hugely popular 'Beveridge Report' sought to rectify The Five Giants, outlining social security for British people 'from the cradle to the grave'. The report, which ultimately led to the establishment of the modern Welfare State, called for a system that would be:
- Comprehensive – The system must comprehensively cover all issues 'from the cradle to the grave'.
- Compulsory – All social insurance would be compulsory, and all workers must contribute.
- Contributory – Workers would contribute a proportion of their wages.
- Non-means tested – Available to everyone regardless of financial situation.
- Universal – Available to all.
Labour Reforms 1945 - 1951
Between 1945 and 1951, the Labour government introduced a series of social welfare policies. These policies were designed to combat Beveridge's 'Five Giants'. Let's look at how each Giant was tackled.
| Five Giants | Policies |
| Disease | Labour introduced the National Health Service Act in 1948. The policy established free access to healthcare (hospitals, doctors, dentists, and opticians), allowing poorer people access to healthcare for the first time. Despite its initial success, yearly NHS expenditure had risen to nearly £360 million within two years. |
| Ignorance | The 1944 Education Act provided all children with primary, secondary, and further education. |
| Idleness | Labour nationalized the steel, coal, iron, electricity, railway, and gas industries. This helped keep unemployment relatively low. |
| Squalor | The New Towns Act (1946) created 12 new towns to tackle overcrowding. This was followed by the Housing Act (1949), which established council houses and gave homeowners financial assistance to make housing improvements. |
| Want | In 1946, Labour introduced the National Insurance Act, which provided financial protection for those sick and unemployed. Two important Acts followed the National Insurance Act. The Industrial Injuries Act (1946) compensated those injured at work. The National Assistance Act (1948) provided financial assistance to unemployed people who had not contributed to the National Insurance scheme. |
Fig. 3 - William Beveridge
The Welfare State during Thatcherism
Conservative leader Margaret Thatcher was elected Prime Minister in 1979. Throughout her 11-year premiership, she dismantled many of Labour's post-war social welfare policies.
Economic Policies
Margaret Thatcher followed Friedrich Hayek's economic theory of monetarism – the belief that governments should control the amount of money in circulation. In 1979, to curb inflation, the Thatcher government raised the base interest rate to 30%.
Despite the introduction of this policy, inflation hit 20% in 1980. This led Thatcher's government to increase taxes and slash public spending. While this policy curbed inflation, unemployment hit 9.6%.
Trade Unionism
In 1980, the Thatcher government passed the Employment Act. This policy limited the number of people who could join a picket line and banned 'secondary action'. This policy was followed by the Employment Act of 1982, which banned political strikes and made trade unions financially accountable for damages that resulted from industrial action.
Secondary Action
When a group goes on strike to support workers from a different employer than their own.
Fig. 4 - Margaret Thatcher
Housing
The Housing Act of 1980 allowed tenants to buy council houses at a reduced rate. By 1987, over 1 million tenants had bought council homes. While the 'aspirational' working class heralded the policy, councils could not reinvest funds into building new houses. This led to the depletion of council houses across the United Kingdom.
The Poll Tax
In 1989, the Thatcher premiership introduced the Poll Tax in Scotland. The Poll Tax was a flat-rate, fixed tariff for adult residents. Before the introduction of the Poll Tax, households had paid an amount based on the value of their property.
The introduction of the Poll Tax meant that individuals living alone saw a decrease in their taxes, but large households saw a substantial increase. The Poll Tax was introduced throughout Britain the following year.
Privatization
In 1982, Margaret Thatcher sold off the National Freight Company to its employees. As her leadership continued, Thatcher became bolder in her bid to sell off nationalized companies. Starting with British Telecom in 1984, Thatcher then privatized British Gas, British Steel, British Airways, British Petroleum, and British Coal.
The Welfare State under Thatcher: Historiography
Margaret Thatcher's relationship with the Welfare State splits historians into two camps:
- Those who believed that Thatcher's policies were dictated by the circumstances in which she worked.
- Those who believed that Thatcher's policies were dictated by her own political and economic beliefs.
This historiographical dispute is known as the Structure VS Agency debate.
Structuralist Historiography
Structuralists believe that a person's actions are dictated by the circumstances in which they operate. In the case of Thatcher, structuralists believe that Thatcher had no choice but to dismantle the Welfare State. They believe Thatcher's choices were dictated by high public expenditure and crippling economic difficulties.
Thatcherism was a political process of narrating the troubles facing the British economy and society in the 1970s.1
- Stuart Hall 1983.
Thatcherism could thus be viewed as a product of the economic context of the 1970s.2
- E. H. H. Green, 1999.
Agency Historiography
Agency refers to the ability of an individual to act independently. Those on the agency side of the debate believe that Thatcher's choices were dictated by her own political and economic beliefs.
Margaret Thatcher's decisions were taken with reference to a few deeply, even passionately, held personal convictions and beliefs.3
- Sir Bryan Cartledge 2003.
She likes everything to be clear-cut: absolutely in favor of one thing, absolutely against another.4
- Francis Pym 1984.
The Welfare State Summary
It's interesting to note that the two most significant post-war British leaders are Clement Attlee – the founder of the welfare state, and Margaret Thatcher – the enemy of the welfare state. Aside from a sense of bitter irony, this observation demonstrates the predominance of social welfare in both UK politics and British society.
While at opposite ends of the political spectrum, both Attlee and Thatcher created a lasting impact on politics that transcended Labour/Tory ideology. Conservative leader Winston Churchill increased welfare spending during his second term, and New Labour continued many of Thatcher's themes throughout Tony Blair's premiership. While the significance of Attlee and Thatcher cannot be disputed, one question remains: Whose welfare legacy remains more apparent in Britain today?
The Welfare State - Key takeaways
The origins of the Welfare State date back to the Asquith government of the early 1900s. Asquith's Liberal government introduced pensions, national insurance, and a minimum wage.
The devastation and destruction of the Second World War prompted Welfare reform to be revisited in 1945.
The Labour government under Clement Attlee government drew upon the Beveridge Report to create a comprehensive social policy.
Attlee's welfare policies included the establishment of a National Health Service, free education for children, and financial assistance for those sick or unemployed.
Throughout the 1980s, Conservative Prime Minister Margaret Thatcher attacked the welfare state; however, historians disagree whether Thatcher's dismantling of the Welfare State was due to the economic circumstances at the time or her own personal views.
References
- Stuart Hall, The Politics of Thatcherism (1983)
- Ewen Henry Harvey Green, Ideologies of Conservatism: Conservative Political Ideas in the Twentieth Century Ideologies of Conservatism: Conservative Political Ideas in the Twentieth Century (2002), p. 214.
- Sir Bryan Cartledge 'Margaret Thatcher: Personality and Foreign Policy' in S. Pugliese, The Political Legacy of Margaret Thatcher (2022), p. 158
- Francis Pym, The Politics of Consent (1984)
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