Welfare Benefit Reform

David A. Preston

The perception of a worldwide crisis in social security benefit or income transfer systems takes place against a backdrop of widely differing systems. Common problems in virtually all developed societies are the consequences of ageing populations, the rise in the proportion of the working-age population supported by income transfers from the public sector, and the issue of how care and upbringing of children is to be provided for.

This paper looks at whether, in the face of these common problems, a common solution is evolving. I conclude that there is evidence that a benefit reform philosophy is beginning to emerge internationally, which, while accepting that change is needed to reverse the massive rise in benefit dependence among working-age adults, accepts that public social security systems are here to stay, and are an integral feature of advanced societies and economies.

The emerging benefit reform philosophy has three characteristics which distinguish it from the more limited objective of cost containment: a philosophy of reciprocal obligations, benefit redesign to support work incentives, and case management.