The coalition government’s policies to restrict the coverage of universal services and welfare payments have been very controversial, in part because they raise questions about the fundamental nature of the British welfare state. Universalism matters for poverty prevention because it generates majority public support for welfare spending, sustaining generous provision over time and aligning the interests of low, middle and high income groups.
This report analyses data from the 1970s to the 1990s for 11 OECD nations and shows that, counter-intuitively, welfare systems which are tightly targeted to low income groups tend to reduce poverty less. A system’s success in poverty reduction is instead related to the overall amount of expenditure. So the inefficiency of universal systems from a poverty-reduction perspective is more than offset by the higher expenditure they typically secure because of their wider public support.
This research forms part of the Fabian Society project ‘Fighting Poverty and Inequality in an Age of Affluence’, made possible by support from the Webb Memorial Trust.
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