The Foundations of the Welfare State

Pat Thane

• Publisher: Routledge
• Year: 2016
• Print ISBN: 9781138160842
• eBook ISBN: 9781317889069
• Topic: Social Sciences
• Subtopic: Sociology
• Index: Social Sciences

A fully revised and rewritten second edition of a book which is now regarded as a classic. Takes full advantage of new research and places strong emphasis on voluntary action and the role of women in the shaping of social policy. It retains the excellent historical perspective that makes it unique among its competitors, comparing recent policy changes to pre-1950 welfare policy.

PART ONE

Changes in Social Policy 1870–1945

CHAPTER 1

Introduction

For some years, the British ‘welfare state’ has faced a critical assault with calls from all political positions for fundamental re-evaluation. It is argued that government social expenditure has grown to a level and in a fashion which is both economically and socially undesirable; that it excessively distorts the functioning of the economic market and provides disincentives to effort. These very arguments were invoked against the initial growth of such expenditure in the fifty years preceding the First World War and in the period of economic crisis in the 1920s and 1930s. In both periods the arguments were found wanting and the ‘welfare’ activities of the state grew. The central purpose of this book is to ask why this was so.

History does not repeat itself precisely. Our understanding of the present may be distorted if we expect it to do so. The value of history lies partly in helping us to understand the nature of present structures and the imperatives which lay behind their introduction. We may more usefully defend or criticize the welfare state if we understand more clearly why it came into being. To interpret its growth simply as a manifestation of altruism, of a desire to remove poverty and other social evils, renders mysterious the fact that much poverty remains, that those in greatest need have often gained least and that their gains have been hedged around with restrictions designed, for example, to keep benefits below normal wages. Public and official discussion of social policy has rarely been solely or even centrally about redistribution of wealth and income in order to eliminate poverty, any more than it is at present. Of equal or greater importance at various times have been questions of political and social order, of increasing the efficiency of the workforce, of international conflict and competition, of methods of increasing demand in the economy or of increasing central government control over economy and society. Arguments derived from pure economic or social theory, or from humane revulsion against deprivation, even when plausible in themselves, have often conflicted with one another or been over-ridden by perceived political imperatives.

Consequently, the analysis of social policy is complex. It is difficult to understand if it is abstracted from the context of social conditions, the structure of the economy and of power, of ideas and expectations from which policies and legislation have emerged. Conversely, the study of social policies tells us much about the societies from which they derive. This is precisely because their discussion necessitates consideration of fundamental questions about the relationship between rich and poor, between government and citizens and about whether, or by which means, economic growth or stability can be reconciled with the achievement of a stable and/or civilized society.

Historians of twentieth century social welfare are sometimes accused of writing ‘whiggishly’, by which is meant a history which assumes progress towards improvement. This cannot be said of this volume or of any other reputable study of this subject published in at least the past twenty years. Such comments confuse the inescapable fact that the ‘welfare’ activities of the British state have grown over this century with an assumed belief that they grew in the best and most beneficial of ways. In general, historians have analysed the first proposition without subscribing to the second.

Their work, however, has undergone interesting changes of emphasis since this book was first published and which this revised edition seeks to survey. These changes were clearly influenced by contemporary events. At the beginning of the 1980s, when the first edition of this book was being written, the focus was almost exclusively upon the state as the primary provider of welfare. Increased government emphasis upon the role of the voluntary sector in the 1980s reminded us of its continuing importance in contrast to a previous tendency to regard it as of diminishing importance, destined for the dustbin of history as the role of the state grew.

Another important change – the gradual working through into academic practice of a general social transformation – is increased awareness of gender in studies of this kind: of the different social problems which men and women may experience and their different roles in attempts to solve them. There has also been a shift over time from emphasizing women as victims of social circumstances to, without denying such circumstances, recognizing too the roles of women as agents initiating and administering welfare policies in the voluntary and statutory sectors.

This book deals centrally with the period from the 1870s to the 1940s. It makes frequent reference to the period before 1870 since the framework established by the Poor Law and philanthropy, and influential ideas associated with both, are essential for understanding what follows even up to the present. The book concludes with reflections on the period since the 1940s. The reason for concentrating upon this confined period is the conviction that this period in fact saw the emergence and birth of something new: that the structures of state welfare and their relationships with the voluntary sector established by the Liberal governments between 1906 and 1914, which emerged from discourses which began to come to the fore in the 1870s, did establish something different from the essentially residual principles of the Poor Laws, Old and New. These structures provided foundations on which the developments of the 1920s, 1930s and 1940s were built, creating a functional, if basic, edifice. Nor have these structures yet (in 1996) collapsed for all the efforts to undermine them.

CHAPTER 2

1870–1900

Poverty and social conditions

For most people, living standards rose in the later nineteenth century. The prices of essential goods were stable, and those of food actually fell. Within this general pattern, there were major and persistent differentials among social groups and geographical regions which barely began to narrow before 1900.¹ It is hard to give a precise picture of the extent of poverty in 1870, since no reliable statistics exist. Dudley Baxter’s statistics of income distribution in 1867 give a vivid impression of the gap between rich and poor at the beginning of the period (Table 2.1).² This maldistribution of income had changed little by 1900.

How many of those at the lower end of this scale could be described as poor? This only became clear when serious large-scale efforts to define and quantify poverty began in the 1880s. Between 1886 and 1902 Charles Booth surveyed, first, poverty in east London, and then in London as a whole. Contrary to what is sometimes thought, he did not conduct a house-to-house survey, nor did he obtain comprehensive information on household income or construct a clearly defined ‘poverty line’. He collected information obtained in the course of their work by school board visitors, whose job was to investigate why children did not attend school, and who consequently were closely acquainted with poorer families. This was not an unreasonable procedure at a time when poverty was startlingly evident in clothing, household goods – or lack of them – in undernourished faces or rickety legs. Booth then cross-checked these impressions with those of other local people such as clergymen, and with the observations of his own investigators who lived for a time in poor communities. Beatrice Webb, then Miss Potter, for example, lived among and observed the Jewish community of east London. Booth also collected household budgets from thirty families. What he collected was ‘a statistical record of impressions of degrees of poverty’ (my emphasis).³ The seventeen volumes of his survey provide a remarkable survey not only of poverty but also of employment and religious observance in London.

On this basis, Booth classified the population of London according to their poverty or affluence. He found that 30 per cent of the inhabitants of London to be living ‘in poverty or in want’. Poverty, he defined as ‘having no surplus’, i.e. having the bare essentials much of the time, but nothing to spare to provide for a crisis such as unemployment, sickness or death in the family. According to Booth, 8.4 per cent of the people of London lived in the worst condition of being ‘at all times more or less in want’, ‘ill-nourished and poorly clad’. In east London where poverty was most heavily concentrated, the figures were 35 per cent ‘in poverty or in want’ and 13.3 per cent ‘at all times more or less in want’.⁴

Table 2.1: Income of Great Britain 1867

	No. of assessments	Occupied population (%)
Upper and middle classes
Class I Large incomes:
(1) £5,000 and upwards	8,100	0.07
(2) £1,000–£5,000	46,100	0.4
Class II Middle incomes:
(1) £300–£1,000	163,900	1.4
Class III Small incomes:
(1) £100–£300	947,900	8.6
(2) below income tax – under £100	1,159,100	10.5
Total:	2,200,000	20.07
Manual labour class
Men’s average wages:
Class IV Higher skilled labour and manufacturers – £50–£73	1,260,000	11.4
Class V Lower skilled labour and manufacturers – £35–£52	4,377,000	39.9
Class VI Agriculture and unskilled labour – £10.10s.–£36	3,270,000	29.8
Total	8,907,000	81.2
Grand total	10,960,000
Total population of Great Britain 1867 (est.): 24,152,000

Source: R. D. Baxter, National Income (1867) p. 64.

This level of poverty might be thought to have been peculiar to London, which was believed by contemporaries to attract the poor of the country as a desperate last resort. In 1899, B. Seebohm Rowntree, like Booth a philanthropically inclined manufacturer with a taste for social investigation, began a survey of the city of York which was designed to test whether the level of poverty in London was peculiar to that city. He aimed to use methods comparable to those of Booth to study a medium-sized provincial town.

Rowntree’s family, manufacturers of chocolate, was the largest local employer in York. The city was he believed, ‘fairly representative of the conditions existing in many if not most of our Provincial towns’, providing a range of industrial and service employment with average pay and employment levels. He did not prove this typicality, for example, by comparing its industrial structure with those of other towns. At this time this would have been difficult; A.L.Bowley was later to do so.⁵

Rowntree investigated the city at a time of ‘average prosperity’. He sent investigators to survey every working-class household in York (11,560) to establish family income and expenditure and to record their impressions of living conditions. He also collected the impressions of neighbours, voluntary workers, clergy et al. The figures for family income which he used were sometimes estimates. His methods were as impressionistic as Booth’s. Like Booth, he did not seek to construct a precise poverty line. He perceived poverty as not simply lack of income but as possessing insufficient means ‘for decent independent life’, i.e. he saw poverty as a relative concept not, as is sometimes thought, as absolute. What society defines as decent will be set by the norms of the non-poor.

Rowntree felt the need to establish the minimum income on which survival in a state of ‘physical efficiency’ was possible. This included an amount sufficient to buy food adequate for energy needs at various ages, at the lowest current prices. This calculation was made possible by the recent exploration by nutritionists of the relationship between diet and health. He concluded that the minimum income necessary for a family consisting of father, mother and three children was 21s. 8d. per week. He found that 6.8 per cent of the working-class population of York (3.6 per cent of the whole) lived in households with incomes below this level. Rowntree described these as living in primary poverty.

He recognized that this ‘only allows for a diet less generous as regards variety than that supplied to able-bodied paupers in workhouses. It further assumes that no clothing is purchased which is not absolutely necessary for health and assumes too that clothing is of the plainest and most economical description.’ Other essentials such as rent, light and fuel were included, also at minimum prices. ‘No expenditure of any kind is allowed for beyond that which is absolutely necessary for the maintenance of merely physical efficiency.’⁶ He recognized that such efficient economy and stringency was not reasonably to be expected even from the poorest; that, even if achieved, an existence at this level was hardly ‘decent’, and that many, even with earnings above the stringent minimum, might be ‘obviously living in a state of poverty i.e. obvious want and squalour’. Such people he defined as living in secondary poverty and estimated that they made up almost 18 per cent of the population of York. He thought this no less a cause of concern for its involuntary character and demeaning effects as primary poverty. Comparing his findings with Booth’s, Rowntree concluded that, ‘we are faced with the startling probability that from 25 per cent to 30 per cent of the town population of the United Kingdom are living in poverty’.⁷

If this was so, and it was probable, what of the rural population? Little public attention was paid to rural poverty before Rowntree undertook a survey in 1912. Yet in some rural areas there were great concentrations of poverty, visible to fewer passers-by, hidden sometimes behind outwardly more picturesque fafades than the urban slums, but just as grim to experience. The proportion of the population living in the countryside had been declining throughout the century. It fell still more sharply from the mid-1870s as a result of severe agricultural depression owing to decline in demand for British produce, and increased imports of cheap food from abroad. The resulting fall in food prices was beneficial for wage-earners, but it caused unemployment in the countryside and emigration abroad and to British towns. Unemployed unskilled rural migrants added to the already overlarge pool of labour in many towns. Since this migration was primarily of young people, the age structure of many rural areas shifted towards a predominance of old people. This in itself increased the proportion of the rural population that was poor.

The impact of agricultural decline varied regionally, but hit hardest regions which were already poorest in the 1860s. The lowest wages in the United Kingdom were in the rural areas of East Anglia, south-west England (where Cornwall was further hit by the decline of tin mining from the 1870s), and the high...

Table of contents

• Cover Page
• Half Title page
• Title Page
• Copyright Page
• Dedication
• Contents
• List of tables
• Editor’s preface
• Author’s preface
• Acknowledgements
• Part One Changes in Social Policy 1870–1945
• Part Two Foundations of the Welfare State
• Part Three Documents
• Appendices
• Select bibliography
• Index