The moral hazard of conditionality: Restoring the integrity of social security law

This article examines the extent to which the Australian and UK social security systems meet their legal obligations to provide basic relief to citizens in need. Conditionality and “mutual obligation” are at the core of both the UK and Australian social security systems and are based on the concept of moral hazard, the goal being to ensure that claimants do not consider living on benefits to be preferable to engaging in paid work. Yet, we argue that the element of “mutuality” is missing in both systems; welfare claimants are subject to myriad conditions and obligations, whilst the state operates free of any legal responsibility to provide even basic relief to those in need, to prevent or alleviate extreme poverty and destitution. We outline the extent to which Australian and UK social security laws require governments to relieve destitution, examining both domestic and human rights law. We conclude that legal protections are weak and that both systems fail to meet the basic conditions of humanity toward their citizens. On this basis, we argue that such failings demonstrate a lack of integrity which undermines the standing of both the UK and Australia to invoke a claim of moral hazard to defend claimant conditionality.     

British and European Influences on the "Australian Way" from the 1980s

Commonwealth countries share their British social policy legacy in a variety of ways. Autstralia attempted to adopt the postwar "new Fabian" welfare state model at the very time when international economic circumstances undermined its Keynesian foundation. With Labor governments in power from 1983 to 1996, Australia diverged significantly from the neo-liberal reform path adopted in the United Kingdom. Australian governments looked increasingly to European social democracies for alternative social policy models. In a manner anticipating the "Third Way", the tendency was towards mixing neo-liberal economics with social democratic welfare. The Australian "Third Way" which resulted proved unstable. Current social reformers, the paper proposes, ought to revisit a neglected but characteristically British emphasis on the need for a measure of "socialization of investment" to underpin redistributive strategies.     

西方经济学家论政府经济职能：历史沿革与启示

从历史的角度看,无论是理论上还是实践上,政府经济职能的转换,主要取决于经济发展的需要。古典学派认为自由经济符合"自然秩序",存在"看不见的手";李斯特比喻政府就像"植树者",会在很短的时间营造森林;福利经济学派主张政府只有积极干预经济,才能解决社会福利问题;凯恩斯要求扩张政府职能;新自由主义则要求收缩政府职能,减少政府干预;新制度学派认为,尽管存在"市场失灵",但政府的过度干预会造成"政府失灵",所以,要在市场和政府之间保持平衡。以上观点对中国在新的历史时期有效实现政府职能的转变具有重要的启示意义。     

MYTHS OF WELFARE REFORM

In Australian welfare reform debate, a range of approaches and policies has been advocated. Regardless of their diversity, I argue that the debate has an unnecessarily narrow framework resulting from the widespread acceptance of at least three welfare reform myths. First, is the idea that the current system is anachronistic and in disrepair. Instead of this narrow focus on welfare policy, I argue that the welfare reform debate must be widened to include other domains of public policy to involve a ‘joined up’ approach to addressing poverty and disadvantage. The second myth is that welfare recipients need to be the focus of policy attention. Policy reforms focus on changing the behaviour of recipients and their communities. Because structural changes underlie increased benefit receipt, such reforms will only have minimal consequences. The third welfare reform myth is the false notion that the current welfare system lacks obligation.     

The Impact of Neo-liberalism on South Korea's Public Pension: A Political Economy of Pension Reform

This article examines the recent Korean pension reforms from a political economy perspective. It argues that these reforms are of particular interest because, unlike major pay-as-you-go pension schemes in Europe, the Korean pension scheme is a funded one and, therefore, is subject to market exposure. Also in contrast to the problems that public pension reforms have encountered in European and other OECD countries, especially 'blame avoidance', the more radical Korean reforms were implemented without significant challenge or resistance. First of all, the National Pension Scheme is described prior to the 1997 Asian economic crisis. Then the impact of this crisis on the Korean welfare state and, especially, its pension system are analysed. The main part of the article consists of a political economy of the pension reform process, in which the key roles of the international governmental organizations and the domestic neo-liberal policy elite are pinpointed. This neo-liberal ideology was critical in developing and sustaining an influential discourse on the 'crisis' in Korea's national pension fund. The article concludes by arguing, against the neo-liberal tide, for the inclusion of a pay-as-you-go element in the national pension in order to tackle escalating poverty in old age.     

Squaring the welfare circle and government ideology: Greece and Spain in the 1990s

This article examines the "squaring the welfare circle" thesis and its usefulness to our understanding of welfare developments in Greece and Spain in the 1990s. The welfare state in both Greece and Spain was expanded considerably in the early 1980s by the newly elected socialist governments, only to hit the buffers of diminishing resources and rising demands in the late 1980s as well as the hostile neo-liberal welfare ideology. The process of welfare expansion was halted in the 1990s, labour market deregulation was encouraged and containment of welfare expenditure became the dominant aim of government policies. This article concentrates on the actual policies of governments in the 1990s rather than on the rhetoric of political parties. It concludes that governments of both the Left and the Right in both countries attempted to "square the welfare circle" mainly through reductions in the supply of welfare. This general conclusion is country-specific and may not apply to other countries involved in welfare restructuring. While recognizing the significance of institutional factors to welfare reform, the article concentrates on the outcomes of reforms rather than on the political process leading to them.     

POVERTY RESEARCH AND SOCIAL POLICY

The present approach to welfare reform, as embodied in the Final Report of the Reference Croup on Welfare Reform (2000), relies heavily on the rhetoric of ‘mutual obligation’ and ‘welfare dependency’ while placing Utile emphasis on original research and relevant data that might inform and support its reform agenda. In marked contrast are the research‐driven policy processes aimed at the alleviation of child poverty that took place during the Hawke‐Keating government in the late 1980s, in this paper we illustrate the value of research in relation to two government strategies, the Family Allowance Supplement (FAS) and the Child Support Scheme (CSS), that were instrumental in bringing a significant number of children out of poverty. We suggest that any commitment to further the reduction of child poverty requires resources for ongoing research programs.     

Varieties of Liberalism: Canadian Social Policy from the 'Golden Age' to the Present

The dominant welfare regimes approach, like the historical-institutionalism on which it draws, predicts path-dependent responses to contemporary challenges. According to this, Canada's social policy regime clearly belongs to the (mainly Anglo-American) 'liberal' family, where markets and families retain a key role, supplemented by modest state supports. Yet, as some have recognized, there are important differences among liberal regimes and within a particular welfare regime over time. There are, in other words, 'varieties of liberalism'. This article argues, moreover, that in the contemporary period Canadian welfare reform has been characterized by warring principles for redesign. While some have sought to deepen the postwar social project, the main trends have been neo-liberal restructuring and, more recently, policies inspired by 'inclusive liberalism', though less deeply than under Blair's government in the UK. The continued existence of such alternatives suggests the need for a more nuanced conception of path-dependent change, consistent with recent revisionist trends in historical-institutionalism.     

Equality and Income Security in Market Economies: What's Wrong with Insurance?

This article critically assesses the marketization of income security, and identifies links between equality, self‐reliance and welfare reform. Marketization in emergent economies is distinguished by a strong separation between the use of insurance for the mainstream economy and relief for the poor. The impact of this model on the shaping of working lives and on market rigidity is discussed through a review of implications in the areas of subsistence, integrity interests and employment transitions. The broad faith in insurance solutions is argued to derive from a highly abstract approach to welfare reform and to result in a lack of attention to uneven and unstable markets, and to self‐government as a motive to work. Evidence of this emerges from a comparison of insurance in its more ideal form (in Chile) with modified models (Brazil and Korea). In the last two cases a developmental orientation has aided in the provision of broad‐based security. Other factors that appear to enhance the importance of direct assistance are also discussed, including aspects of state administration and labour services that limit work opportunity and individual autonomy in uneven economies. The segregated dual approach to income security is argued to be broadly deficient, but not because insurance is inherently wrong. Countries as diverse as Barbados and Denmark show that more cohesive economies are a better foundation for integrating insurance with general welfare and for income security and individual enterprise broadly conceived.     

Doing The Right Thing: Labour's Attempt to Forge a New Welfare Deal Between the Individual and the State

This paper explores the rhetoric behind the Labour Government's welfare reforms. Recent publications and statements emanating from the new administration indicate the extent to which Labour feels comfortable with notions of communitarianism and stakeholding. The influence and (potential) impact of these two concepts upon welfare policy is explored through the works of Macmurray, Etzioni, Hutton and, in spite of his departure from Government, Field. The paper argues that in attempting to create a welfare system based largely on conditions of work, set firmly within a framework of self-help and individual responsibility, Labour's reform agenda is concerned with the establishment of a new moral order for welfare in which individuals are urged to "do the right thing": that is, to take control of their own welfare and ultimately to be responsible for meeting their own needs whenever possible. The Government presents this attempt to forge a welfare settlement between the individual and the state as both new and inclusive. However, it is concluded that such claims are contentious as the Government's "new" approach echoes old individualistic ideas about the causes and solutions to poverty, and may also result in the exclusion of some citizens from publicly financed welfare.     

China: developmentalism and social security

China began its social security reform when the market-oriented economy was first promoted in the late 1970s. Initiatives have been taken to replace the employer-based labour insurance model with a largely social insurance model. However, it is a mistake to argue that China is pursuing a neo-liberal agenda in its social initiatives. Instead, the state has played a major role in the process. Based on a developmental analysis, it is argued that the direction of change is generally encouraging. The emerging social insurance programme has the following advantages: it widens coverage, facilitates economic development, seeks a minimum entitlement, fosters social integration, and enhances individual participation and responsibility. The creation of an economically and socially viable social insurance programme will support the economic development of the country in the twenty-first century.     

Events that Trigger Poverty Entries and Exits*

Objective. This article examines how events—such as changes in household composition, employment status, disability status, and economic conditions—affect poverty entries and exits. We also examine whether the role these events play in poverty transitions differs in the pre‐ and post‐welfare‐reform periods. Methods. The analysis uses discrete‐time multivariate hazard models along with monthly, longitudinal data from the 1988, 1990, and 1996 panels of the Survey of Income and Program Participation (SIPP). Results. Analyses show that many events are related to the likelihood of entering and exiting poverty. Of the trigger events examined, individuals living in households that experience a loss or gain of employment are the most likely to enter and exit poverty. We also find that changes in employment are more important in the 1996 to 1999 time period—after welfare reform—than in the 1988 to 1992 time period—prior to welfare reform. Finally, changes in household composition, disability status, and educational attainment are found to play a role in throwing people into poverty and helping them exit from poverty in both time periods. Conclusions. There is no single path into or out of poverty, suggesting that multiple policies can be considered to help alleviate poverty.     

Making welfare work: UK activation policies under New Labour

This paper describes and briefly evaluates the major "New Deal" activation policies introduced by the UK New Labour government since 1997. It outlines the ambitious project to modernize the UK economy and welfare state and, within this overall strategy, to end child poverty and to tackle social exclusion by encouraging movement from welfare benefits into work, and by making work pay. Three sets of New Deal programmes are discussed: those targeted on unemployed claimants, lone parents and people with disabilities. The paper concludes that real change has been achieved with measurable beneficial effects but that there are threats to the further elaboration and extension of the New Deal model.     

Impacts of off‐farm employment on welfare,food security and poverty: Evidence from rural Vietnam

How off‐farm employment can enhance welfare in terms of food consumption and poverty alleviation is a critical question facing many developing countries. This study addressed that question by pursuing two objectives: (i) to quantify the impact of off‐farm employment on rural households’ welfare, food security and poverty; and (ii) to examine the factors that affect their decision to work off‐farm. Using panel data, we estimated a difference‐in‐difference combined with a propensity score matching model. The findings show that off‐farm employment improves income, ensures food security and contributes to poverty alleviation. The results also show that age, marital status, education, labour, financial capital, land, location, market access and losses from natural disasters are significant contributing factors to the decision to participate in off‐farm employment. The findings suggest that to improve the welfare of rural households, the Vietnamese government should proceed with policies that enhance their opportunities for participation in off‐farm employment.     

Principles and practice of social security payments for care

This article examines the dimensions which determine whether national social security systems make payments towards the costs of long-term care needs and whether they do so where these needs are met within the family; what kinds of payments are made and to whom; and what levels these payments are set at. The article is based on empirical material from five European Union countries (the United Kingdom, Ireland, France, Italy and Germany). We argue that differences between countries along three dimensions account for most of the diversity between national systems in this field. These dimensions are the allocation of responsibilities and powers to local versus central levels of government; assumptions of to whom long-term care represents a "risk"; national principles of subsidiarity and the relationship between the family and the State. This is, however, a field undergoing change (albeit mostly incrementalist and ad hoc) in the face of the demands placed on social welfare systems by growing levels of disability (related to the growth of elderly populations) and demands from women's movements and disability movements for recognition of their needs within social welfare systems.     

The Changed Welfare Paradigm: The Individualization of The Social

The first part of this paper offers a cumulative review of the changes in global objectives and operating principles and their global consequences, characteristic of the shift from the ideal type of the modern welfare state to the neo-liberal or post-modern paradigm. The paper then spells out some of the implications of this shift for social security in the "transition countries" of Central and Eastern Europe. The tendencies (from marketization to the spread of means-testing) are similar to those in the West; but they are much more marked and there is much less political and popular resistance to these changes. One of the crucial ingredients of the shift is the undermining of the age-old solidarity between generations, a trend also strongly recommended by the supranational agencies. The "catch", or the "paradox of democracy" is that, for all the lack of resistance, people do not seem to approve of the rapid withdrawal of the state and the loss of their existential securities.     

The Spatial Strategy of Equality and the Spatial Division of Welfare

In this paper we argue that little is known about either the geographical objectives or the spatial outputs of the welfare state. Conclusions of geographical inequality are problematic for three main reasons. First, the geographical aims of the welfare state, "the spatial strategy of equality", are unclear. Second, the geographical distributional paradigm is rarely placed in the wider context of local and national welfare states, and the tension between spatial equity and local autonomy is ignored. Third, the geography of welfare, "the spatial division of welfare" is often based on simplistic and confused evidence. Much of the existing work implicitly takes a centralist perspective, assuming that all geographical inequalities are defects. Issues of local government, local politics and local welfare states are ignored. All detected inequality may not be "bad", and greater spatial equity may not necessarily be "good". The spatial division of welfare should not be examined in an analytical vacuum, isolated from the wider contextual issues of national and local services and the trade-off between local autonomy and territorial justice. If the "default value" is that all detected geographical variations are assumed to be defects, then the arguments for localism are doomed to failure.     

The United States: welfare, work and development

It has long been claimed that social welfare programmes harm economic development. These programmes, it is alleged, depress work incentives, divert scarce investment resources to 'unproductive' social services and create a large underclass of dependent individuals. Welfare reform in the United States intends to reverse these allegedly negative economic effects by requiring welfare clients to work. It also hopes to reduce poverty. This article examines these claims. It discusses the welfare reform programme and concludes that its impact on both economic development and poverty has been minimal. Policies that transcend the current obsession with work, promote sustained economic development and invest in human capabilities are more likely to succeed.     

Introduction: social policy, economic growth and developmental welfare

Although the notion of developmental welfare is not new, it is only in recent times that its central premises have again attracted attention in social policy circles. Since developmental welfare offers an opportunity to challenge the neo-liberal claim that social expenditures harm the economy, and that economic development requires retrenchments in state welfare, more information about this approach is needed. This article discusses the developmental welfare approach with reference to neo-liberalism's current hegemonic influence on social policy. It traces the historical evolution of developmental welfare, discusses its theoretical implications and outlines its practical proposals.