Universality vs. Selectivity and Privatization of Social Welfare

1. Universality vs. selectivity

Universalism vs. Selectivism

-a continuous debate in social welfare has to do with methods of implementing social welfare policy

-the three models of social welfare suggest various ways of making social welfare programs available to those who most “need” it

-for much of the history of the welfare state, the debate has been over what has been termed universal programs vs. selective programs

Selectivism and arguments in favour:

1. social welfare goods & services are the same as those goods and services distributed through the market, thus normal market procedures for distribution apply

2. Price must reflect cost of production and distribution, otherwise there is an inefficiency in allocation of resources (demand will be artifically high). Charges (i.e. user fees) are meant to deter

3. Users of social services will make rational decisions based on costs and perceived benefits

4. While some people might be deterred by the thought of applying for benefits and subjecting oneself to means testing, this will in fact only deter a small minority

Universalism and arguments in favour

1. Social welfare services are not the same as other services dealt with by the market, and hence have to be treated differently.

2. An individual’s ability to claim entitlement to what they “need” is subject to a variety of social, environmental & bureaucratic obstacles, and the ability of the person in need to overcome them is frequently overestimated.

3. social cohesion, integration, collective responsibility, etc. all go in to making the distribution of most services best based on need only, and not based on means testing.

Arguments between the two

a) take-up rates: universalists claim that seletivisim deters those who both need and are eligible for the service; selectivists reject that

b) stigma: are people stigmatized through means testing?

c) administrative costs: means-testing (selectivism) is more expensive to administer, hence the frequent tightening of selection criteria to keep costs down; universal programs are relatively inexpensive to administer

d) poverty traps: universalists argue that people are kept from trying to raise their income by the fear of losing their eligibility for selective programs.