by Professor Chris Fox, InnoSi Project Director and Director of the Policy Evaluation and Research Unit at Manchester Metropolitan University.

One of the aims of the InnoSi project is to identify and evaluate existing innovative and strategic approaches to social welfare reform, which utilise social innovation at a regional and local level. In the UK one of the main areas of research on the InnoSi project will be to examine the implications of adopting a neo-liberal approach to welfare.

In a number of international studies that compare different approaches to welfare, the UK has sometimes been characterised as a neo-liberal welfare model. This model implies access to the market might limit the need for welfare so that although universal (state) assistance is provided it is limited to encourage the economically vulnerable towards self-sufficiency and reliance on privately purchased welfare provision.

Analysis of the architecture of the welfare state under the Coalition government (2010 – 15) provides some evidence for such a model. Writing early in the life of the Coalition government Professor John Hills of the respected Centre for the Analysis of Social Exclusion, based at the LSE, published analysis that suggested the potential for the structure of public spending on the welfare state to change over the coming years. He suggested that health care and pensions were becoming more important, while non-pension social security, housing, and non-school education were becoming less important. More recently, a team from CASE have published an analysis of welfare reform over the 5 years of the Coalition government and compared it to the previous Labour government. They found that spending related to children rose rapidly under Labour and fell under the Coalition, spending on pensioners rose under both Labour and the Coalition governments and that working age benefits unrelated to children fell under both Labour and the Coalition.

Last week a think tank, the Resolution Foundation published analysis looking at likely future government spending and warned “the nature of the post-crisis consolidation – allied with demographic changes – is serving to increase the share of overall spending on older people and health while reducing the share going to working-age families and economic growth”.

There is then some evidence to suggest that there has been a move towards a welfare system more characteristic of the neo-liberal model. What implications does this hold? In 2011 Hills suggested that the trends in welfare reform he observed suggested a move towards a US style model:

“A welfare state where provision for the older population through health care and pensions becomes more important, and that for the working-age population becomes less generous and more residualized, promises to take the UK system further in the direction of the structure in the USA” (Hills 2011: 607)

Do we, as country wish to move further in this direction? The recent debate over reforming tax credits (many recipients of which are in low paid work), with opposition to the government’s proposals coming from across the political spectrum suggests that there is some unease about this.

Also, this is not just a debate about public spending. As the Resolution Foundation analysis makes clear both the size and the shape of the state is changing with government effectively withdrawing from some areas of social policy and drastically reducing state support for some groups in society. This might have a range of long-term consequences, many of which are hard to predict. The Chairman of the Resolution Foundation, the former Conservative government Minister David Willets, commenting on these trends and broader ones in housing was concerned that “The social contract between generations in Britain is being broken”.

This is why the Innosi project wont only be looking at welfare in terms of economic or policy choices. We will also be involving welfare recipients and seeking to understand how the decisions that governments take impact upon people in local communities.

@MMUPolicyEval