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Opinion: Tuition fees – a progressive model for welfare?

July 6, 2012 10:13 AM

By Samuel Barratt in Liberal Democrat Voice

Originally published by East Midlands Liberal Democrats

Looking at who is accessing benefits to ensure those in receipt of them should be is to be welcomed. A blind eye should not, however, be turned to wealthier individuals in receipt of things like winter fuel allowance whilst cuts are made to some of the poorest in our society.

It is right that Liberal Democrats have distanced ourselves from Cameron's musings that everyone under 25 should not be able to rely on support from society. Radical changes are however needed to how we treat welfare to help ensure a strong welfare system continues to exist and is in a better position to weather future financial storms than it has been on this occasion.

The safety net that the welfare system provides is precious and has to be protected. A move to a 'tuition fee' style model for some benefits payments is worth considering. Benefits such as Job Seekers' Allowance and Housing Benefit up until a certain 'capped' value could be considered as a loan. When an individual is back into work and earning above a certain threshold, a small amount is taken - as in the tuition fee model - on a monthly basis to repay up to that capped amount.

Having claimed housing benefit for a short time, I was met with a mixture of ridicule and bemusement when I enquired as to how I could repay the amount I had claimed when I moved into full time employment. Why should this be the case? I had benefited from the system, what is ridiculous about the idea I should make an additional contribution back to it?

The model has to be progressive and always encourage work. The threshold at which repayments would begin would have to be set at a fair level and the rate of repayments adaptable to an individual's income; those moving into employment have to be better off in real terms.

Alternatively, in less turbulent times a loan element could be used as a 'top up' to the basic benefit which people are currently eligible for. For example, for the first 6 months somebody is on benefits they could opt to claim an additional amount on top of their basic benefits in the form of a loan, which would be repaid as described. Any savings could even be used to help fund schemes to help people back into work- for example by expanding the wage subsidy plans.

The driving force behind this model has to be to safeguard the welfare system against excessive cuts; this cannot be a backdoor excuse to strip away the crucial support that is the last resort for so many people. If this model could allow support to not be taken away from those who need it, then it is a progressive, liberal measure and should not be criticised on the grounds that it is asks people to make a contribution back to the system from which they have benefited.

Whilst Labour and the Conservatives compete to see who can be 'toughest' on welfare, Liberal Democrats should be radical reformers; changing how welfare is viewed and treated without risking the safety net the system can so often provide.

* Samuel Barratt is Parliamentary Assistant to Sir Alan Beith MP