Our safety net - keep social security public
If you are ill, disabled, struggling to find a job, bringing up children, or past working age then you can apply for social security benefits to help you. This safety net is funded by taxpayers and distributed by the government on the basis of need. However, privatisation is threatening our safety net. Many private companies involved in social security are too expensive, have made mistakes that have damaged people’s lives, and have increased inequality.
The recent film, ‘I, Daniel Blake’ shows the importance of this safety net and the problems caused by failures in social security. Private provision can make these problems worse as the profit motive encourages companies to further cut costs and services at the expense of those who desperately need help. This makes private provision less effective than public provision and also increases inequality.
What you need to know
- In 2013, 38% of the decisions made by Atos – a private company brought in by the government to assess disability claimants – were found to have been incorrect, yet the company’s boss still received a £1 million bonus. The process of repealing these bad decisions cost the Ministry of Justice £60 million.
- In 2015, staff at the private recruitment company Action 4 Employment fraudulently claimed nearly £300,000 of taxpayer money.
- In April 2016, a Channel 4 documentary revealed that the private company Capita had been dismissing disability claimants without even meeting them. The company tried to get through assessments as quickly as possible to save money, despite the impact this had on the disabled people it was meant to be helping.
- The government is trying to hand over responsibility for our pensions from the public to the private sector despite research showing that this increases inequality and reduces pensions for low-paid workers, particularly women.
Why is social security being privatised?
The government has argued that the private provision of social security increases efficiency and reduces costs. However, provision of services by private companies is very expensive and often less efficient than public provision of these services could be. Between 2012 and 2013, central and local governments spent more than £4.3 billion on goods and services provided by the four main companies – including Capita and Atos – involved in our social security. This is taxpayer money that is being lost to profit-driven and problematic private companies rather than being kept within the public sector.
The Concentrix case
- The government has recently ended a contract with the private company, Concentrix, over tax credits. Tax credits are paid to those with children and to people in work yet struggling on low wages.
- Since 2014 the government has paid Concentrix £32.5 million of taxpayer money.
- The contract was cut after thousands of people – particularly single mothers – had their tax credits wrongly stopped, many letters from the company had gone missing, and lots of people had their tax credits taken away without the required 30 day notice.
- The Shadow Chief Secretary to the Treasury, Rebecca Long-Bailey MP, has called for a public enquiry into the ‘contract, which has delivered nothing but misery for millions of hard-working people, especially women.’
- 15,000 people are currently appealing the decisions made by Concentrix over tax credits.
- It is now possible that our taxpayer money will be used to fund compensation for the mistakes made by this private company.
What can you do?
Click to find out more or to appeal a decision made by Concentrix.
Photo taken from the film 'I, Daniel Blake' (2016).