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Iain Duncan Smith: Saving the Welfare State From Misguided 'Kindness'

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Anyone who genuinely, seriously wants to protect our welfare state should be full-square behind Iain Duncan Smith's latest ideas for reform.

A Daily Mail article has trailed the idea of using smart-cards to restrict what certain individuals spend their benefits on. Cue much outrage about the further 'demonisation' of benefits claimants from many on the Left. Apparently there's some moral principle that demands taxpayers fork out money to help addicts fuel their alcoholism. Well maybe so, but it's not a principle I - or most British people - recognise. And here-in lies the paradox that we who call ourselves progressive have to get our heads around - if we want to save the welfare state we're going to have to get used to it changing pretty dramatically. As Giuseppe di Lamedosa famously remarked 'If you want things to stay as they are, things will have to change'.

I want there to be a safety-net for folk who fall on hard times. The good news is - as the British Social Attitudes survey and a flurry of recent polling shows - so, in principle does almost everyone else. But, in common with my compatriots, my support for a welfare system does not equal support for this welfare system. We need social security in this country - not social dependency.

Last week, Demos released the findings of a poll, conducted on our behalf by Populus, looking at attitudes to how people spend their benefits. Coming on the back of the BSAS (which, while showing in-principle support for welfare also found high and growing levels of concern about how our benefits system works - or fails to work) this polling highlights the need for further and more radical reform. Nine out of 10 of us believe that government should exercise more control over what benefits are spent on - either for one or more group of claimants or in order to prevent the purchase of certain, harmful or expensive goods.

The fact that government currently exercises little to no control over how benefits are spent - while the vast majority of us wish that it would - should bring home the growing gulf between our expectations of what is reasonable in relation to welfare and the policy responses on offer.

In my view, there are two possible justifications for limiting what benefits can be spent on. The first is in the case of alcohol and drug dependent claimants - whose addictions are ruining their lives and often the lives of those around them. These are people whose illness is all-too-often being enabled by the payment of cash-benefits, which allow them to fuel a destructive habit and makes recovery all the more difficult. By giving this group smart-cards, that could only be used to buy groceries and essentials, and by targeting treatment, we could do a lot of good with minimal harm. This is not about punishing the sick - it's about enabling their recovery.

The second group we should look at are the non-disabled, non-contributors. People who've never had meaningful work and have never made a meaningful contribution - through NI - to the safety-net the rest of us pay for. There are too many in our society who walked out of the school-gates and onto the dole queue without so much as a glance at the workplace.

We're a civilised country, we don't let people starve to death in the streets. But the lack of recognition for contributors - who, on the whole, will get pretty much the same out of the state as those who've put nothing in - is a damaging and corrosive theme of our welfarism. We can't afford to give contributors substantially more. But we could give them more freedom and flexibility over how to spend their benefits than those who've added little to the pot. After all, for those who have worked and paid-in their welfare is a right and an insurance policy they should expect to enjoy when times are hard. For those who have failed to pay-in, welfare is the privilege of being born to our generous and caring society. It's right, proper and - if the attitudinal evidence is to be believed - necessary to start making that distinction. Smart-cards for those who could have contributed but have not done so would be a step in the right direction.

What's more, it would add more nuance to the 'conditionality' framework. At the moment, the only real penalty we have for folk who refuse to play by the rules is to remove their benefits for a short time. So if you refuse to apply for a job we can stop payments - but only for a little while because, as I say, we're a civilised country. Under a smart-card regime we could use flexibility as a reward and greater control as a punishment. That gives us a better range of tools to use in the battle to get people back to work.

I want a welfare state that accords with the moral intuitions of British people. To continue with what we've got would be to dangerously derange benefits from the beliefs, attitudes and opinions of those who pay for them. We need to listen to those who pay the bills, not denounce them. Exercising more control over how benefits are spent - to differentiate between contributors and non-contributors and to enable the recovery of addicts - would be a kindness both to individuals and to our welfare system itself.