The United Kingdom's welfare system that is currently implemented had began after the World War II and lived onto the next thirty years. However, just like most countries at that time, UK had been through serious economic problems. …
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Issues that concern the welfare of the society had become the top priority of the government since then. Until eventually John Major replaced Thatcher, welfare reform was high on the agenda. This was clearly illustrated and demonstrated when the government had considered spending two-thirds of its budget is spent on the welfare state and services it provides among its citizens. (Faher, n.d.)
In 1980's and 1990's, the UK government had made several adjustments concerning the welfare state of the country due to the increasing crisis that the government was experiencing brought about by its increasing expenditures concerning poverty among the members of the society. Welfare benefits were divided into five groups - cash benefits, health care, education, housing, and personal social services. Cash benefits have become the most widely used form of welfare thus eating up around 10% of the country's Gross Domestic Product (GDP). National insurance, which obtains the largest spending, has affected two of the other cash benefits subgroup, the means-tested and the non-contributory benefits. There had been very low pension benefit levels such that it only makes up half of a person's active salary which is even barely enough to meet ones needs, most especially the elderly. (Faher, n.d.)
Just as any other western countries, the growing population of the elderly has been greatly affecting the welfare state in the United Kingdom. The aging population in the UK had become the biggest challenge the welfare state has to face. The need for more assistance and services is required in order to meet the needs of this group within the community. This concern, in fact, does not only involve the social policies of the government but it also affects the financial aspect - that is the expenditure of the government. However, the problems are not as obvious as other countries whose problems with the elderly had been too prominent that they have eventually become the burden of the government. (Faher, n.d.)
On the other hand, in the United Kingdom's socio-economical perspective of the social welfare, it views such as one that is an essential complement to industrial development. This view, which is termed as the handmaiden model sees that social policy helps the economy to grow by serving the workforce, providing services to industry and offering a secure basis for development. One particular example of which is the Keynesian economics that is utilized in Germany where it recognizes that spending on welfare is a useful tool in economic regulator that aids in balancing the economy during the periods of recession. ("An Introduction")
The National Insurance Fund (NIF), which finances the retirement pension program (together with other income security programs, such as survivors, disability, sickness and maternity benefits, unemployment, and work injury), does not appear to have either short-term or long-term solvency problems. In addition, some comparative studies have demonstrated that the UK's projected long-term public pension costs relative to the Gross Domestic Product (GDP) are the lowest among leading industrial nations. This is a rather impressive accomplishment, given that the United Kingdom has a larger proportion of aged population than does the United States and this situation is
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