Ruwayda Shariff discusses potential ways to tackle the rising inequality due to Covid-19 through welfare reform measures.
After every crisis, the reality of those at the bottom end of society become more apparent. This was shown through the 2008-2009 financial crises and now, throughout the coronavirus pandemic which exposed why both a strong social security system and higher public spending is needed to reduce inequality. Before the pandemic, there had been numerous reports calling for welfare reform. However, due to the unpredictable nature of general crises, we need a shift which is aimed at providing security, ensuring some level of certainty, whilst facing unprecedented levels of uncertainty. Under today’s circumstances, we have been provided with an opportunity to make direct changes and fix the faults within the system, before existing inequalities worsen.
But, how do we reform or update such an outdated system? Costly reforms which are not targeted or a sudden influx in funds to save the welfare state will not be an effective remodelling method. The government need to use tools which tackle the rising inequality, ensuring the most vulnerable members of society are not further affected by the defunding and austerity.
Here are a few ways on how this could be done;
Firstly, the welfare system needs to implement an effective reemployment plan, reducing the pressure on the system. The lockdown measures introduced led to an increase in unemployment and more people have become reliant on the social security systems.
By April, four million people had registered on the Universal Credit, an increase of 40% since March (the number has increased at a faster rate throughout the pandemic).
The system was not built to provide such an influx in support and lacks the funding capability to prevent the rising inequality. Through reemployment, it would reduce the higher, unsustainable demand.
To implement an effective reemployment plan, delivering financial bursaries to companies would provide them with the incentive and ability to continuing hiring. This can be combined with paid skill-enhancement placements. Recently, the Government Recovery Plan put forward paid skill-enhancement placements to reduce the growing youth unemployment crises. According to the Trades Union Congress, 16-24-year-olds are three times more likely to work in sectors which have experienced higher job cuts. Widening the plan to include those with low-income and skill-base can further drive the economy, encourage reemployment and ultimately create a more skills-based workforce.
Alongside the above reemployment plans, tightening job security is crucial to retain the contracts. This can be done by encouraging workers to join unions, further implementing labour laws, increasing worker’s influence and maintaining rights.
As we discuss effective reforms within the system, it’s important to highlight that not everyone will be able to benefit from such amendments. Filling the gap is an essential part of the welfare reform. Currently, those with a No Recourse to Public Funds (NRPF) immigration status, under the Immigration and Asylum Act 1999 (Section 115), are not entitled to receive the majority of public funds such as welfare benefits, including income-based Job Seekers Allowance and access to Universal Credit. Thus, we need to widen the safety net to protect the unprotected, allowing the most vulnerable to access Public Funds, following protocols set by Article 3 in the European Convention on Human Rights.
Overall, welfare reform is not a one-time event. Continuous adaptation and reformation should be an essential aspect. As we prepare for a post-coronavirus society, a new proposal needs to be implemented. This should be centred on reducing the growing inequality through reemployment, reinforcing job security and resolving the faults exposed in the system, before the Job Retention Scheme ends.
Ruwayda Yahya Shariff holds a Bachelors in Development Studies from SOAS, University of London and is majoring in Social and Public Policy. She has interests in increasing local participation in the public policymaking process, reforming the welfare system and reducing social inequality.
She tweets at @rRuwaydaShariff