Benefits Street: The biggest problem for our economy?

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“There are 99 houses, 13 nationalities” – pause whilst someone in the background shouts “WANKER!” before the voice over proceeds – “and most of the residents are claiming benefits”. This is how Benefits Street began on Channel 4. “The street feels like a family”, claims White D this snippet of conversation is carefully placed between videos of her dancing to music from a car in the street and then followed by another of her smoking. Drug dealing, drinking in the street, court cases, little formal education, void of ambition, shoplifting, even the cliché caps and tracksuits – these people were constantly shown to be different. Some have even suggested now the title “War on Welfare” is justified. However, the constant association of ‘benefits’ with people who are made out to be ‘scroungers’, which we see over and over again, is dangerous and vindictive.

[quote]Most of what we know is derived from documentaries like Benefits Street which purely focus on extremes – it is television, after all.[/quote]

For many of us, benefits may seem to be a faraway concept. It’s a system we don’t really understand because it’s just not part of our lives. Most of what we know is derived from documentaries like Benefits Street which purely focus on extremes – its television, after all.  So, what’s the reality? One thing many of us disregard in the benefit spending debate are State Pensions – the most costly of all welfare spending – that none of us would dispute are absolutely necessary. From 2010-2011, this cost £69.88 billion, between 2011 and 12, this figure stood at £74.22 billion, a change of 3.7% including inflation.

Third most expensive is Disability Living Allowance, equally as uncontroversial as pensions, this is a vital part of the system. Despite this, The Times reported in December that one in ten people with disabilities, who had experienced benefit cuts, were left reliant on food banks to feed themselves and their families. From 2010/11, the cost stood at £11.88 billion; £12.57 billion over the next two years, an increase of 3.3% including inflation. The list continues, to cover other welfare payments such as Job Seekers Allowance and TV Licenses for over 75’s, which cost considerably less.

These statistics alone show that documentaries such as Benefits Street only show a minority of a section of welfare claimants and completely ignore the vast majority. There are issues within the system that should be acknowledged. From 2012/13, 2.1% of the estimated overall benefit expenditure was overpaid because of fraud and errors within the system; £3.5 billion, but this figure pales in comparison to the unclaimed £16 billion by working or sick people. But to combat this David Cameron has revealed plans to prevent EU migrants claiming child benefit from the UK government for children who live abroad. With George Osborne declaring to Radio 4, conveniently the same day as the broadcasting of Benefit’s Street, that “we need to find a further £25 billion of cuts after the election”. Welfare will undoubtably be a focus as one of the biggest costs.

To put these figures into perspective, we must look at other areas of government spending. The Financial Times reported in September that “Britain has spent more than £33bn on military campaigns overseas over the last 20 years”. The NHS cost the tax payer £105.254bn in 2012/2013. Many essential UK services have seen vast cuts introduced over a short space of time which have had detrimental effects. In the meantime, loopholes have allowed perfectly legitimate low tax costs for large corporations.  Google’s UK division paid just £12 million in tax in 2012, despite revenues of £506 million. The company faced headlines such as “Eric Schmidt: I’m very proud of our tax avoidance scheme”. Large international Companies are certainly benefiting from the government’s incompetence in producing effective tax laws.  Eric Schmidt in response said “If the British system changes the tax laws then we will comply. If the taxes go up we will pay more, if they go down we will pay less. That is a political decision for the democracy that is the UK.” Yet Schmidt has not received any challenge to be taken at his word.

Unfortunately, as convenient as it may be to view welfare spending as a big useless mess responsible for all financial difficulties, this is not the case.  The demonisation of the people of Benefit’s Street and the reality of benefits are worlds apart.

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