Seventy years after the Beveridge Report, how we fund welfare remains a controversial issue.
Today the 2020 Tax Commission floated the idea of a 30% flat tax (starting on incomes of £10,000). Backed by the Institute of Directors and the TaxPayers’ Alliance, the proposal would see an end to National Insurance.
Beveridge saw National Insurance as the key to funding his welfare plans. You received your benefits in return for “paying your stamp” into a special fund. (Even though things didn’t quite turn out that way: as Nye Bevan said*: “the great secret about the National Insurance fund is that there ain’t no fund.”)
Does the 2020 Commission’s proposal represent a step forward?
* hat tip to John Phelan, one of our co-founders, for unearthing this interesting quote.