Ten: The restructuring of redistribution


This chapter reviews developments in social security and anti-poverty policy in recent years under the Labour government, and shows that both poverty and inequality have fallen. The evidence up to 2004–05 shows that ‘redistribution works’, even if that was not part of the language used by New Labour. However, this success has come at the price of increased complexity, high effective marginal tax rates and a split in responsibility between government departments (the Treasury and the Department for Work and Pensions). Moreover, it is not clear whether this relative success has actually been perceived by the general public, or translated into popular support for the policies concerned. Nor is it apparent what are the next steps that would move poverty rates down below those achieved in 2004–05 to achieve the promised halving of child poverty by 2010, let alone make them among the ‘best in Europe’ by 2020.

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