Introduction

Since 1997, the New Labour government has been very active in reforming the social security system in Britain. As well as major changes to key benefits, there has been a succession of minor reforms, amendments and extensions to numerous aspects of social security. This almost hectic activity has been driven by a number of important factors. In part, it reflects New Labour's belief that social security needs to be modernised to reflect changes in the economy and society since the Beveridge report (DSS, 1998a). These developments include rising female labour force participation, increasing divorce and relationship breakdown, the growing number of lone-parent households, the shift from manufacturing to service employment, growth of part-time work and increasing longevity. To some extent, therefore, modernisation is about updating social security to cope with the ‘new social risks’ of post-industrial society (Taylor-Gooby, 2005).

The extensive reforms also reflect New Labour's desire to ensure that social security, and social policy more generally, is designed to accommodate economic policy concerns more explicitly than was previously the case (Lewis, 2004). This is believed to be necessary in order to help create and maintain a competitive economy in an increasing globalised world (Taylor-Gooby et al, 2004). This driver of reform can be seen in the central role that the Treasury has played in welfare reform. Moreover, the shift towards tax credits and away from benefits has arguably enabled the Treasury to keep a much closer grip on income maintenance than before.

The re-shaping of social security has also been influenced by New Labour's ‘third way’ agenda (Powell, 1999, 2000; Lewis and Surender, 2004). Among other things, the third way is a rhetorical device to reposition the Labour Party politically and distinguish it, not only from the Conservatives, but also from ‘old’ Labour. Thus, in his foreword to the welfare reform Green Paper, Prime Minister Tony Blair argued that the document: