The Concept of the Mixed Economy of Welfare

The Concept of the Mixed Economy of Welfare

Brian Treacy (16475634)

        This essay will discuss the role of the Irish state in delivering welfare and welfare provision. It will then discuss the private, informal and voluntary sectors in delivering welfare and how the state plays a vital role in these institutions’ delivery of welfare through policies, financial aid, regulation and planning. Throughout this essay it will demonstrate what the mixed economy of welfare should consist of in ideal circumstances in an Irish welfare society.

        According to Kennedy (2013:99), there are 4 main institutions from which people in society receive welfare. These are the state, the commercial sector, the voluntary sector and the informal sector. Depending on your welfare needs the department in which your welfare comes from and how much welfare you are entitled to varies. The institutions in which one receives their welfare from should be based on what institutions are best equipped and most suitable to meet one’s welfare needs.

        Briggs (2000:180) states that the welfare state, through social services, is involved in the direct provision of welfare to those in need by “narrowing the extent of insecurity by enabling families to meet certain ‘social contingencies’ (sickness, old age and unemployment)”.

The state provides public sector services like hospitals and schools which provides welfare to those in need.  One main function of the state is to redistribute wealth and resources amongst society to reduce disparity. It attempts to provide the poor with an opportunity to climb the social class ‘ladder’. It’s discussed that this should be achieved without a complete shift in wealth from rich to poor. Macleod and Powell (1952) argue that “the social services only exist for a portion of the population” and “the social well- being of the nation had been endangered by the distribution of wealth”. Briggs (2000:18) adds that the state “is concerned merely with abatement of class differences or the needs of schedule groups but with equality of treatment and the aspirations of citizens as voters with equal shares of electoral power”. He argues that it is a right for everyone to receive welfare that would enable them to have the opportunity to live a better life and that it’s necessary for the state to assist the other welfare providers in ensuring they deliver fair and quality welfare to welfare recipients.

        According to Spicker (1995:117), the welfare state is also responsible for the regulation and planning in which welfare services operate. Moran and Wood (1993) categories the state’s regulations into four categories using the analogy of a Doctor of Medicine. They discuss who can become a doctor and where they can become a doctor. They then discuss regulating areas related to the market forces of advertising and the buying and selling of goods. These 4 categories of regulation are to ensure that those in need will have close range quality welfare and that they will be able to afford necessary welfare. Spicker then states how the welfare state has the responsibility through planning in ensuring the mixed economies’ welfare resources meets the needs of the community (p. 118).  Clawson (1973) adds that the state can attempt to demand the private sector offer essential services in addition as a condition in other areas: “Shopping centres might be required to provide communal facilities, like a leisure centre, as a condition for their permission”. These policies play a vital role in ensuring quality welfare is provided to citizens and that each economy of welfare are obliged to carry out necessary welfare.

The private sector is an area which seems to provide to the middle and upper classes more than other forms of welfare. It sells goods and services in the market in the hope for profit.  However, these purchases come at a cost in which many in society cannot afford. Those who can bear such costs may avail of this sector to buy private property and private health care in attempt to make their wellbeing better and satisfy their needs. Holden (2008:202) believes that “the principle of equity is at the heart of the welfare state and markets may have profound implications for both equitable access to services for equitable outcomes”. This may suggest that the private sector should provide quality welfare at fairer prices to those in need. If not, the responsibility should them be passed onto the state to provide necessary welfare. This welfare would come in the form of medicines, education services and housing. Dukelow and Considine (2009) suggest that state support for the building of social housing began in 1886 and their support is just as necessary in Ireland today. The state filled an impoverished gap where the commercial sector failed to do so as it was too expensive to be availed of by those who simply couldn’t afford private property. When market prices rise due to competition between private sector consumers intensifying, the state should introduce policies and regulations in order to supply welfare to those in need. Titmuss believed that because society is so competitive in the market that this lead to diswelfares: “They are the part of the price we have to pay to some people for bearing part of the costs of other people’s progress; the obsolescence of skills, redundancies… they are socially caused diswelfares, the losses involved in aggregate welfare gains” (Alcock et al., 2001:120-121). Again, the welfare state should intervene with necessary regulations to ensure fair pricing in the private sector with regard to housing and other private sector services.

        Informal welfare refers to “the extra help given to ill, disabled and older people by friends and relatives, as distinct from that given as part of a formal paid job…” (Glendinning and Arksey, 2008:219). Spicker (1995) points out that “the discharge of people from institutions and maintenance of individuals in the community has led to a greater emphasis on the role of carers”. A means tested Carer's Allowance was introduced by the Social Welfare Act (1990) which would give payment to full time carers, many of these women who gave up employment. (Cousins, 1994:31) However, should the carer fail to meet the criteria in accessing funding, this may lead to the informal sector failing to provide welfare to those who need it. Timonen and McMenamin (2002:28) argue that "it is very unlikely that the means testing of carer’s allowance will be abolished despite repeated calls for “universalization” by interest groups such as the Carer’s Association”.  Fanning (2006) argues much informal care consist of unpaid work. If carers attempt to provide welfare while being underfunded, this may lead to personal debt and poor mental health. As a result of the example given, the state should consider providing welfare for family carers e.g. counselling due to the states inaction in providing universal welfare to the informal sector. This sector is dependent around what those close around you have to offer to the development and sustainability of one’s life and ideally, the state should provide welfare for those providing personal welfare in the informal sector (Hoffmann and Rodrigues, 2010).