Incentives and Sanctions: Shifting Patterns of Risk Management in the Welfare State
Politics University of Sheffield Sheffield, United Kingdom
Risk is the defining characteristic of the modern world (Beck, 1992a; 1992b). However, an element of the management of risk has always been present in the evolution of the social security system in the United Kingdom. The Liberal government's reforms 1905-1911 were based on the concept of social insurance against what have been termed "Old Social Risks" (OSR) felt by industrial workers (Bonoli, 2005). The post-1945 welfare refoms continued this, resulting in a welfare system designed as a state response to risk (Barr, 2001; Giddens, 1996; Taylor-Gooby et al, 1999).
However, the changes wrought by globalization, and demographic shifts, have altered the nature of risk and who is most affected. In a post-industrial, post-modern era, these "New Social Risks" (NSR) offer new challenges. Both globalisation and demographic changes have broken down the hegemony of society on which traditional welfare systems have been based (Bonoli, 2005). Policies based on meeting NSR are evolving to be better targeted, and to show more awareness of attitudes and behaviour; thus the understanding of motivation and the use of incentives and sanctions become increasingly important (Taylor-Gooby, 2004).
New Labour's welfare reforms reflect this shift. The state transfers risks both to individuals and to private sector and third sector organizations. The rights and responsibility agenda, underpinned by a sanctions regime, aims to create a welfare system where individuals take responsibility for their own risk. This paper discusses these recent reforms and proposed changes to the welfare system in the context of understanding the state's response to "risk society".