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Social welfare can be a lifesaver. But society often shows negativity to those living on it.
In this chapter, Cashfloat, offering UK short-term loans, how living on social welfare impacts their lives. We will consider the impact of living on benefits: for the individual, their family as well as for society. Apart from economic hardship, hidden costs such as effects on health and the academic attainments of children occur.
Deserving Poor Or Scroungers?
Ignoring all the consequences of struggling financially and relying on social welfare (the so-called JAMs: Just About Managing), the main problem faced by people living on social welfare in the UK is people’s perception of them. Not only in the press and by politicians, but also in the eyes of the people they have contact with on a day-to-day basis. Their family, friends and neighbours put pressure on them, based on the stereotype, and show negativity to the way they rely on benefits. Often these people have no other choice but to receive social welfare.
The purpose of the press is to sell newspapers or increase viewing figures so there is no nuance in the way they present people on social welfare. They view these people as a ‘mass’ without considering that people on benefits are made up of different sexes, educational levels and social classes. They opt for the easy solution and so only seem to present stories of benefit fraud blown out of all proportion to the actual numbers involved (the scroungers). Furthermore, they concentrate on the ‘deserving poor’, those mistreated by the faceless bureaucrats of the Job Centre or DWP.
Politicians who use vote-catching rhetoric, reinforce this. They defend cuts in welfare provision by referring to the ‘damaging cult of welfare dependency’ or welfare being a ‘life-style choice’. Blame the person living on welfare for their situation.
Both the press and politicians’ statements have an effect on how the people they live with and the society they live in view those on benefits. In general, people are judgemental. For someone struggling to get by, but not eligible for benefits, it is much easier to blame their neighbour (who is on benefits). They do not blame the company paying them the minimum wage or politicians in Westminster, an accountable target. After all, their neighbour on benefits is the one they will see every day in the shops.
This treatment of those on benefits by those who do not need financial help from the state (the so-called skivers vs. strivers) makes for a highly divisive society. Nowhere is that seen more clearly than the amount of people prepared to call the DWP hotline to report welfare fraud. In 2015 alone, there were 153,038 phone calls, of which 132,772 (87%) were found to be baseless. Are these people reporting what they actually see or what they expect to see because of press reports and politicians’ comments?
The division between those on benefits and others in society affects economic growth as well as social cohesion. People who do not work, offer nothing to the society in which they live. Whatever your political persuasion, you might view this as a waste of resources (the under-use of labour). Or, on the other hand, the tragedy of the unemployed not being given the opportunity to realise their full potential. It really boils down to the same thing, limited economic growth and big divides in the society.
The effect of people living on benefits not only leads to losses for the economy. Both the cost of welfare payments and the loss of tax revenue must also be taken into account. It also entails hidden costs for other governmental departments. In 2016 the Joseph Rowntree Foundation commissioned research in order to put a price on deprivation. They came to the conclusion that if you add up all the extra expenditure, it is the equivalent of £1,200 for each person in Britain.
Their research estimated that healthcare alone costs the economy £29 billion (25% of all healthcare spending). This is spent mainly on ailments and illnesses caused by inadequate and badly-maintained housing. Additionally, a lower standard of living. The other hidden costs of poverty include, the money required for education. This includes providing free school meals or pupil premium funding to help children from socio-economic disadvantaged backgrounds. Likewise, extra funding for the children’s services and the police.
So much of our identity is bound up in our job. When someone asks you what you do, they are not just asking about your career. They also make a number of assumptions about your educational level, class and who you are as a person. Now try imagine replying that you are unemployed or unable to work. Conclusions will be drawn which will probably not be very flattering and this will in turn affect your own self-image.
It should come as no surprise that people deprived of the chance to contribute to society (because they are on benefits) often suffer from a number of psychological problems such as depression.
These psychological problems will also influence the dynamics of family relationships. Combined with the strain of trying to get by on a low income, these emotional problems can cause an estrangement between couples and even affect their relationships with their children. Children are not only deprived of material possessions when the family is on benefits.
When we think about children growing up in a family on benefits, we initially think how they must suffer from deprivation of material possessions. Unlike their classmates, they will not have the latest trends in trainers or a laptop at home. However, being raised in a family which has financial problems, relying on UK payday loans, has other consequences, some of which can last for the whole of the child’s life.
Children who grow up in a family close to or on the poverty line have a higher risk of premature birth and illness. Both factors can have an effect on their future health and eventual life expectancy. Poverty can also play a role in their academic achievements. There are few chances of taking part in school trips. Would the family have sufficient money to heat a bedroom for them to study in or would they have to try and concentrate in the communal living areas?
Research has shown that by the age of 3, children from deprived backgrounds lag nine months behind other children regarding cognitive development. According to the Department of Education, by the time they finish primary school, recipients of free school dinners are on average 3 terms behind their peers.
Finally, living on benefits determines where parents raise their children. Is the area safe enough for them to play outside? Are the playgrounds vandalised? Sometimes they cannot even invite a friend home for tea; small pleasures which many children take for granted. All of these factors have an effect on the development of their skills in social interactions. To make matters worse, they might encounter teasing or even bullying at school as their classmates imitate the attitudes and prejudices of their parents as well as society itself.
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All things considered, Cashfloat, a direct lender loans online, has looked at the effects social welfare has on society and the economy. The prejudice created by politicians and the press convince the public to blame their benefit dependent neighbours on their money worries. Furthermore, the price paid for social welfare and impact on people’s mental health state affects the economy. Likewise, in the long run, children growing up in social welfare dependent homes lag behind in school and develop a cycle of pushing people into the poverty trap. In the next part of this chapter, Cashfloat looks at the reality of living on benefits.