The House Magazine, partenaire britannique de La Revue Parlementaire.
Richard Hall, directeur éditorial.
With the euro established and constitutional reform on the backburner,
the dividing line in the European Union is now the economic
and social model. In one camp stand the 'Anglo-Saxon' free-marketeers,
who argue for lower personal and business taxes and a scaled
down welfare safety net. In the other, defenders of a more generous
social system - with higher state pensions and stronger rights
for employees - funded by higher taxes.
British prime minister Tony Blair told the European Parliament
last year that to select between these two systems was a false
choice, that a dynamic economy must coexist with a welfare model
that dispenses social justice. However, in the same speech he
attacked the European social model for producing 20 million
unemployed, and compared it unfavourably with the economies
of the United States and those of India and China.
So, what of Britain's social model? The welfare settlement inherited
by Margaret Thatcher in 1979 had pretty much stayed intact since
the post-war government of Clement Attlee. His Labour government
built a welfare state based on the collectivist principles that
formed the foundation of Britain's war effort. In the 1960s
and 70s successive governments of both parties fought through
economic crises to maintain a welfare system that demanded more
money as the population increased.
Thatcher gradually dismantled the post-war economic model, cutting
entitlement to unemployment benefit, curbing trade union rights,
dispensing of nationalised industries and cutting the higher
and basic rates of personal taxation.
By the time Labour came to power in 1997, the UK social system
had been remodelled. Blair has attempted further reform, seeking
to create a system that reaches his aim of marrying economic
dynamism with social justice. Controversial restrictions on
disability benefit sent an early message that Labour would not
be returning to a comprehensive welfare system. Similarly, the
restrictions on trade unions introduced in the 1980s have remained
in place and direct personal taxes are largely the same as in
1997. Corporation taxes have been reduced, but 'stealth' and
local taxes have risen sharply. This and a period of sustained
economic growth have allowed the government to inject large
and much-needed funds into UK public services. Improvements
have been significant, although slow to materialise. Despite
the extra funds, the National Health Service remains in a precarious
financial position. Staff are being laid off as the NHS trusts
that operate the system have fallen £700m into debt. And a ticking
pensions timebomb - with neither state, firms nor individuals
contributing enough to provide for a generation of future pensioners
- has not been diffused.
Much of the UK social settlement is secure. No party is soon
going to effect the wholesale reintroduction of employment rights,
hike income tax levels, and substantially raise benefit payments.
Similarly, large tax cuts and wholesale dismantling of state-run
services are off the agenda.
The key question for the future of the UK social model is the
extent to which current tax levels can sustain state-provided
health and pensions. As more demands are made on these systems,
the need to find private and voluntary sector providers to share
the burden will grow.
* The House Magazine a été créé en 1976 par un groupe de
députes afin de traiter et débattre de l'ordre du jour parlementaire
de manière impartiale mais incisive. Il est depuis 30 ans l'hebdomadaire
des parlementaires britanniques.
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