Introduction

This chapter examines some of the key themes shaping New Labour's social security policy, assesses whether its policies continue or break with the Tories’ legacy of 1997 and speculates on where Labour is taking social security. First, having posed the terms of the question of continuity or discontinuity, the chapter examines the changing needs of four social groups on which the government has focused: lone parents, unemployed poeple, disabled people and pensioners. Second, the chapter seeks to describe the government's ‘Third Way’ in social security in tackling the problems of these groups and in seeking a path that departs from the policies of Old Labour and New Tories. Finally, it outlines the changing direction of welfare under Labour. The next two sections will be largely descriptive in content and the last more speculative.

The question of continuity or discontinuity – between the social policies of New Tory and New Labour, of Old and New Labour, and of the classic and new welfare states – is central to the analysis of social policy today (Powell and Hewitt 1998). However, it becomes an increasingly complex question the more you attempt to disentangle the lines of continuity and discontinuity.

At first glance, some continuity with the social policies of the former Tory government is evident. Labour stuck to Tory expenditure plans for the first two years of government and will not raise levels of income tax during the remaining three years (Chapter Two). It implemented Tory plans not to up-rate the Income Support premium for lone parents and One Parent Benefit but to remove these benefits altogether from new claimants – reforms passed by Parliament despite considerable public dismay.

In other areas the new government has broken continuity with the previous government. Most significantly it has announced an increase of £56 billion in public spending in its Comprehensive Spending Review (CSR) for the final three years of government, although little of this is intended for social security. It has promised to keep the basic pension which the Tories proposed privatising.