Very few people under the age of 50 have any idea what those deductions from their pay packets mean. There is no longer an emotional understanding of its significance, or sense of participating in a wider insurance system. (I stopped drawing it.) Benefits must become just a safety net for times of financial crisis, not a right.National insurance was a fine idea – everyone paid in, everyone got out. When I was widowed I was astounded to receive a widowed mother’s benefit of more than pounds 120 a week, automatically, without anyone asking what I earned or whether I needed it. It was paid only on the basis of my late husband’s NI contributions. National insurance pretended to be a genuine insurance fund, but there never was any connection between sums paid in over a lifetime and pensions or other benefits paid out. It never from its first day paid enough state pension for anyone to live on: those with no other income always had to be means-tested and paid national assistance or income support on top, so it never offered either the security or the dignity it promised.Yet the system still pays out arbitrary sums to people not in need, when they become unemployed, sick, disabled, widowed or old, regardless of how rich they are.

Any reform means there will be many losers as well as gainers, and the losers ought to be the vocal middle classes. Does Labour dare?It’s time to start all over, and dismantle the whole national insurance system that still pays out according to notional contributions made and not according to need. It’s time to say that a phoney system started by Beveridge has had its day. For a government reputedly good at spin, its presentation on everything to do with welfare and cuts has been catastrophic. That sounds like a platitude, common sense everyone could agree on.But politically it will require extraordinary bravery, with a focused programme that sets out from the start what the objectives are So far we have seen nothing much of that. Meanwhile many people who are not poor are still drawing large sums on the social security budget.

All the money should go to those who need it, and all who could find work need to be prodded into doing so. Some people who haven’t a hope of ever working are kept far too poor. The numbers are set to start rising again next year according to the Bank of England, so it hardly seems likely that an overall cut is achievable anytime soon.There’s no doubt the whole welfare system needs reform. And it’s also because we have a great more unemployed than in 1979. But the growing number of poor workless households is partly because of the increase in pensioners, many of whom are poor. We have a problem within welfare, which Blair defined well in his speech: the Tories spent an extra pounds 44bn in real terms and yet there are more poor people than ever before Welfare isn’t working as it should, that’s plain. For example, pensions take up by far the biggest chunk, rising as the population ages, and nothing much can be done about that in a hurry.
We do indeed have a problem with welfare, but not with its overall total.

We spend more than we collect in the whole of income tax,” said Blair. Scary stuff, deliberately scary stuff and if he goes on like that, he will find himself hoist on his own populist rhetoric, and judged by his failure to deliver significant cuts in social security spending – a target he cannot achieve. But the more politicians go on pretending that there is, the more voters will believe it and demand cuts. “We spend more on the Department of Social Security than we do on education and employment, health, and law and order combined.

We spend a bare 13 per cent of GDP on welfare, compared with Germany’s 30 per cent, France even more. We spend the same as the Americans and the Japanese, the least in the developed world There is no welfare spending crisis. How important is it? In the general sweep of the economy, not at all. Tony Blair’s speech in Sedgefield this weekend reiterating his determination to press ahead with reform didn’t help For he didn’t say how, not even really why. We do not all begin life with equal social resources; nor do we all have the same opportunities or effective choices in the course of our lives This is because there really is such a thing as society..