Analysis

Lessons from Across the Pond: What the US Should and Shouldn’t Take Away from the United Kingdom’s Social Policy

Conservatives have long called for combining and freezing federal funding for key health, nutrition, and income security programs and then handing those funds over to the states. As evidenced by the track record of TANF and several other block grants, this strategy has historically resulted in large cuts to benefits, and made block-granted programs much less responsive to recessions and increases in population and unemployment.

Last year, Representative Paul Ryan proposed the most recent conservative block-grant proposal. Under his Opportunity Grant program, funding for the nation’s bedrock nutrition assistance program (SNAP) and several other means-tested programs would be combined into a single block grant with a fixed annual funding level. Rep. Ryan says he draws inspiration from the United Kingdom’s Universal Credit—a new means-tested cash entitlement benefit that consolidates six current benefits, including the Housing Benefit, Child Tax Credit, and Job Search Allowance. The Universal Credit has gotten off to a slow start in the UK due to implementation challenges, but the government says it will be fully implemented by 2019.

We will hear more about the Universal Credit this week. At an event at the conservative American Enterprise Institute, Iain Duncan Smith, UK Secretary of State for Work and Pensions—and the architect of the policy—will keynote a discussion of what the United States can learn from the Universal Credit.

There are already a long list of effective homegrown practices and policy reforms that are seeing results.

The fact is the Universal Credit doesn’t even remotely resemble Rep. Ryan’s proposal—or, for that matter, TANF or other block grants in the United States. Perhaps the most fundamental difference is that the Universal Credit will be an entitlement to eligible low-income people, one that is administered centrally by a single government agency.

We’re all for learning what we can from other countries, but the Universal Credit is not the most relevant policy for the United States to draw on. Among the key differences limiting its relevance to our system is the fact that one of the main problems the UK is trying to address—financial penalties for work—is far less of an issue in the United States. This is due to the design of our Earned Income Tax Credit—which kicks in at the first dollar of earnings—and the limited nature of other means-tested benefits for low-income unemployed people.

Moreover, a primer the Center for American Progress co-authored last year on the Universal Credit notes several concerns with the policy. For example, the UK’s Housing Benefit is currently a locally administered in-kind housing benefit paid directly to landlords on behalf of low-income tenants. Under the Universal Credit it will be paid directly to tenants as a cash benefit and administered centrally by the UK’s Department of Work and Pensions. This has raised concerns about how tenants, especially vulnerable ones, will manage direct payments of housing costs, and what happens if they fall behind on rent.

We do, however, welcome a conversation on how the Universal Credit can spur momentum stateside to reduce the administrative burdens associated with navigating multiple safety net programs. But it is worth noting there are already a long list of effective homegrown practices and policy reforms on this front that are seeing results. For example, the Affordable Care Act created a new, simplified system that states can use to enroll eligible people into Medicaid and CHIP, including an option to enroll people based on their SNAP eligibility.

Beyond the Universal Credit, when it comes to social policy more generally there is indeed a lot the US could learn from the UK: the UK has stronger labor market protections, more modern workplace standards, and a longstanding commitment to ensuring that working-age people—whether in or out of work, and with or without children—have access to health care for free as well as a minimum floor of housing and income assistance. While we don’t know if these types of lessons and reforms will be discussed at this week’s AEI event, any discussion of the UK’s Universal Credit and its relevance to US social policy should not be divorced from this broader context.

To that end, here are a few things we hope US policymakers do consider when taking lessons from across the pond:

  • Health services and almost all prescription drugs are free for everyone in the UK. But in the US, 22 states have refused to implement the Affordable Care Act’s Medicaid expansion, leaving millions without access to care and subject to higher “marginal tax rates.”
  • In the UK, all low-income people who rent are guaranteed means-tested housing assistance; in the US only about one-quarter of eligible low-income renters receive help.
  • The UK guarantees means-tested unemployment assistance to low-income people who are unemployed—a single unemployed person without children is eligible for weekly grants that total about $450 a month[i]. The US does not have a means-tested unemployment assistance program that guarantees benefits nationwide. Low-income people can access SNAP, but the benefits are much more modest, and can only be used for food.
  • The UK provides a family allowance to all low- and middle-income families with children through its Child Benefit and Child Tax Credit. In 2015, a single parent with one child and no earnings would be eligible for about $6,300 as a basic income guarantee under just these two benefits. While the US has a Child Tax Credit, it is modest by comparison and completely excludes families with no or very low earnings.

Although some of these programs—means-tested unemployment assistance, Housing Benefit, and Child Tax Credit—will be brought into the Universal Credit, they will continue to function as entitlements with the same base benefit levels.

Beyond benefit differences, it’s also worth noting that the UK has a national minimum wage, which is updated annually and currently equal to about $9.50 an hour (it will go higher when updated later this year) and gives almost all workers a legal entitlement to paid sick days. In addition, it provides paid family leave and a comparatively expansive system of pre-K and child-care assistance. This may help explain why women’s labor force participation has grown steadily since 2000 in the UK, while trending downward in the US.

In short, the US has a lot to learn from the UK. But we should glean our biggest lessons from the UK’s policy and reform successes that have improved basic labor standards, strengthened work-family balance, and fortified benefits for low-incomes families. Efforts like these have led to better outcomes for individuals and families, including lower poverty rates, than we have accomplished to date in the United States.

[i] This and other UK benefits amounts are converted into US dollars using an exchange rate that adjusts for cost of living differences between the UK and US.

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Analysis

Congress Should Keep Funding Home Visiting—It Works

Despite its success, the Maternal Infant and Early Childhood Home Visiting (MIECHV) program is in danger of expiration without quick action from Congress.

Ninety percent of a person’s brain development occurs before the age of five. This means that children’s experiences between the time they are born and the time they enter school are critically important for setting them on a path to success. Unfortunately, not all children have the supportive environment they need to thrive – especially children living in households where they are exposed to economic instability, domestic violence, child abuse, or significant mental health challenges.

The good news is that public policy can address these risk factors. The Maternal Infant and Early Childhood Home Visiting (MIECHV) program is a proven solution that is helping parents provide the nurturing environment children need. In the program, home visitors – who can be health, social service, or child development professionals – work with expectant mothers and families with young children to assess their needs and to refer them to other services. They also provide coaching and parent education to promote healthy child development.

MIECHV has a strong track record of success. Rigorous evaluations and research of home visiting services demonstrates that the program ultimately improves health and saves money for taxpayers. The services lead to tangible results like better birth outcomes; improved child health; better educational attainment for moms; improved school readiness; reduced child abuse and neglect; and more economically self-sufficient families. In addition, the federal grant program has allowed the home visiting program to reach more people in states and tribal communities across the country; it has also helped connect home visiting with other early childhood services to ensure that families can access the continuum of social supports—from health services, to income support, to early education.

MIECHV expiring due to a lack of congressional action would be devastating, as it serves some of the most vulnerable families in the country. Recent analysis found that most women participating in MIECHV-funded home visiting were young, single parents who did not have formal schooling beyond high school. The majority of these women made less than $1,000 a month on their own.

These families know how critical MIECHV support can be. Christina had a challenging upbringing in a home where she experienced abuse, homelessness, and poverty. When she became pregnant at age 15, she enrolled in the Nurse-Family Partnership (NFP) program. Throughout her pregnancy and the first two years of her child’s life, she received regular visits from a trained nurse who monitored their health. The nurse also provided support and guidance to ensure that Christina’s baby achieved the appropriate developmental milestones. Participating in NFP gave Christina the skills and confidence to be a good parent and also achieve her own life goals – she has since been able to complete her high school education and is on a path toward success for herself and her child.

Authorization for MIECHV expires at the end of March and without action from Congress, states and tribes will be unable maintain services for all of the children and families served by MIECHV funded home visiting. In order to prevent this harm to already vulnerable families, Congress must act quickly to reauthorize MIECHV at current funding levels before it expires on March 31st.

Evidence-based home visiting is a solution that improves the lives of thousands of families across the country. Failing to extend this critical lifeline now is unacceptable. Congress must reauthorize MIECHV to create more opportunities for low-income children and their families to thrive.

 

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Interview

Breaking the School-to-Prison Pipeline in Mississippi

TalkPoverty has focused extensively on the significant connection between the criminal justice system and poverty. One study found that our nation’s poverty rate would have dropped by 20% if not for mass incarceration.  But a key area we have yet to explore is the school-to-prison pipeline—a combination of unjust policies and practices that criminalize student behavior. It’s a system that pushes millions of students—primarily children of color—out of the education system and into the juvenile and criminal justice systems.

 The Mississippi Center for Justice is fighting not only to end the school-to-prison pipeline, but to reform structures that perpetuate poverty in one of the poorest states in the nation.  TalkPoverty Assistant Editor Alyssa Peterson spoke with Reilly Morse, President and CEO, about the organization’s work.

Alyssa Peterson: Tell me about what your organization does and your role?

Reilly Morse: The Mississippi Center for Justice was founded in 2003 by Martha Bergmark, a longtime civil legal aid lawyer and a Mississippi native. We saw legal services as an antipoverty tool go through the wringer in the late 70s through to the 90s. And, after seeing all that on the national level, [Bergmark] worked on ways to arrive at a privately-funded version of what I think had originally been the vision of a lot of legal services programs: to provide meaningful impact work and to use the system of justice to eliminate poverty or reduce it.

The idea was to identify locations in Mississippi where meaningful, smart strategies that looked at economic justice issues on the civil legal aid side, could make a real impact. We began working on restoring Medicaid benefits to people living below the poverty level, seniors, and people with disabilities. Later, two years into the life of the organization, Hurricane Katrina struck, and [Bergmark] hired a couple of people, including me, to start a Katrina Recovery office. Over the next seven years, we did a lot of impact work, but the most significant was getting Governor Barbour to commit $132 million to finish a housing recovery that he had [previously] walked away from halfway through. This money has all gone to low-income households to repair, restore, and reconstruct their homes.

We also remain very focused on healthcare efforts. We have basically a totally recalcitrant legislature when it comes to expanding Medicaid, but we are also seeing such great strains on rural hospitals that we are hoping that these strains will turn around our state legislature when it comes to the need to find a way to put a floor under those hospitals, to put some kind of financial support, to keep them open.

Conservatives have limited the kinds of legal aid services that can be supported by federal funding. Can you provide background on historical context for that and why it’s really important that legal aid be at the center of anti-poverty efforts?

We have to be able to step into the layers of institutional inequity and alter them at that systemic level

So, the Center’s view is that we need to be a voice that has fiscal independence. We have to be able to go in whatever direction we need to. We are not going to solve problems of poverty in Mississippi just by providing assistance to individual poor people one at a time. So, we have to be able to step into the layers of institutional inequity and alter them at that systemic level if we’re going to have any kind of effect at all. Just about every system that’s here – whether it’s the judicial system, whether it’s the political system or otherwise – is already calcified against poor people. It takes a powerful incursion into that to try to make meaningful change, so we have to have flexibility.

You do a lot of work on the school-to-prison pipeline, where students, primarily students of color, are funneled out of public schools and into the juvenile justice system and criminal justice system. How is this playing out on the ground in Mississippi?

Well, in the Mississippi Delta, where a lot of this work is done, you have public schools that are sharply underfunded; that are predominantly African-American; and in which teachers and administrators tend to turn school infractions into criminal or youth court infractions more than they should. So, you have a higher than normal number of referrals to youth court for offenses that are not criminal offenses and that can be properly addressed by the school systems.

We [also] learned that the rules for school discipline are wildly different between districts. In some cases, the basic rules and requirements of due process are hardly there. In other cases, you can’t find where [the rules concerning due process] are, and still in other cases, the rules are contradictory.

Our job is to intervene on behalf of these kids and their parents to make sure the law is observed and to invoke in the fullest possible way all the rights they have. This means fighting so that there aren’t referrals to youth court for things that aren’t criminal offenses, and ensuring that, if there’s an offense, that it’s treated with proportionality.

Still, there are instances in our state where there are widely disproportionate penalties placed on children. From what we’ve discovered, the students’ first experience with the justice system, whether it’s school discipline or youth court, tends to have a very powerful, negative effect on their lives, especially on the school system side. Contact with the justice system sours their view about how things are when they get out of school and when they get into the world. That, I think, erodes confidence in law enforcement and in the courts, and that stays with them for life. In addition, once kids are referred to court system and pick up a criminal charge, that charge stays with them and produces barriers to housing, future employment, and public assistance.

I was told that you all represented a first-grader who was suspended for a year for bringing a pink toy gun to school. Are these sorts of punishments for minor incidents common?

That’s a particularly colorful example, but you’ll have all kinds of instances like that. In fact, there was a Department of Justice consent decree entered in the Meridian School District with similar types of examples – children disciplined for wearing nonmatching socks, or doing various other things that are just trivial, flippant, kid things. They are not stuff that you send somebody to youth court for.

We try to build the capacity to address poverty so we do not have to depend on someone from the outside swooping in, solving one problem, and leaving. This is about building a consistent, long-term force for upward mobility for Mississippi.

The President requested a 33 percent increase in their budget request for the Office for Civil Rights, which often enforces these cases. Do you think greater federal enforcement would have an impact in Mississippi?

It can only help but it’s important that there is also state-level recognition and respect for these requirements. It ought not only be on the Feds to enforce the Constitution of our nation. It ought to be part of what our state Attorney General does, and it ought to be part of what our legislature takes into account when it passes laws. But they [the legislature] only seem to have an appetite for increasing punishment for the poor.

For example, last year, they passed a law to do drug testing of TANF beneficiaries, and the initial version of that law said that any person who did not pass the drug test would be disqualified. But then, our [implementing] agency passed rules saying that anyone in the family who was receiving benefits would also be disqualified. That wasn’t in the scope of the law, so we pushed back. You can see that there’s a default tendency to find a way to punish more poor people if you can get away with it, and that’s happening at the state level.

It seems on the national level that there is momentum between conservatives and progressives to reach a consensus to reform the criminal justice system? Have you seen that in Mississippi, and what would that compromise look like?

That’s interesting because [reform] has some momentum on the sentencing side. Last year, the high cost of incarceration reached a threshold of pain for our state leaders, and they started to look at ways to deal with non-violent offenders, particularly by resentencing or altering parole and probation rules for certain classes of offenders. They’re finding ways to lower the population in our prisons for non-violent offenders, and that’s kind of a remarkable step forward for our state. I’m very happy about it. It’s a small, but important, step.

So what are some of your upcoming fights and goals for the year?

We are very interested in putting some kind of uniform due process standards into place for school districts when dealing with discipline issues. This is how to root out systemic problems and how to make headway on our education and poverty challenges

We also are very interested in further pushing out an initiative we began about two years ago called the New Roots Credit Partnership. The program is an alternative to pay-day lending, and involves pairing public employers with banks and credit unions that offer saner alternatives to payday loans. [These alternatives have] lower interest rates, better repayment terms, and mechanisms that aren’t engineered to push people further into a hole. Those are probably the top two priorities.

Related

Analysis

The answer to homelessness? Reliable employment.

This week, the city of Boston conducted its annual Homeless Census, during which teams of volunteers spanned the city and counted the number of people living on the streets, in shelters, or transitional housing. Data from the annual count is used to make decisions about where to spend scarce resources to reduce and prevent homelessness among individuals and families.

The quick and obvious answer to the question of how to address homelessness is to provide permanent housing to those who need it. A New Yorker article published last fall about Utah’s wildly successfully policy of giving housing to people who are homeless went viral on social media. Last month, Seattle officials announced plans to open three “tent cities” to provide shelter to people who are homeless. In addition, President Obama’s plan to end homelessness among veterans has had success, in part, because of its focus on immediately placing people who are homeless into permanent housing without requiring them to first complete an alcohol or drug treatment program.

The ultimate solution must include reforms that will prevent people from becoming homeless in the first place.

There is no question that one of the keys to reducing homelessness among individuals and families is to provide them with housing. But much like health reform advocates known as “upstreamists” want to see health insurers pay for prevention initiatives that will keep people healthy, those working to end homelessness know that the ultimate solution must include reforms that will prevent people from becoming homeless in the first place.

For example, a veteran who is able to find employment is much less likely to experience homelessness than one who can’t land a job in the first place. A single parent with two school age children needs to earn at least $29.30 an hour (in Massachusetts) in order to dramatically lessen the likelihood of experiencing homelessness or housing instability that that same parent would face earning minimum wage. And a person trying to find housing after a period of incarceration is unlikely to succeed unless he or she is also able to find employment, a task that may prove difficult due to the common practice of potential employers discriminating against applicants who have criminal records.

In order to achieve longer-term success in reducing homelessness, we should focus on three areas:

Community support for those trying to live independently after a period of incarceration.

People with criminal records face barriers to employment due to discrimination. It’s hard to think of anyone better situated to make the successful transition from prison than Piper Kerman, author of the memoir Orange Is the New Black upon which the successful Netflix series is based. When Kerman sought to rebuild her life after her release from prison, she enjoyed the support of family and friends, and had the advantage of past career accomplishments. Yet in multiple interviews, she cites one factor as being the most important in her post-incarceration success: the job that a friend had waiting for her, and which she was able to begin just one week after leaving prison. Very few of those emerging from prison have a job waiting for them. As they seek employment, many will need intensive skills training, as well as support connecting them with health care providers and, if needed, substance abuse programs. Further, we need reforms that address the many barriers formerly incarcerated people face, with regard to employment, housing, public assistance, education and training, building good credit, and more.

 Job skills training for the long-term unemployed.

It takes marketable skills in local, growing industries to land a job that will lift someone out of homelessness―and keep them housed. Such training must run the gamut from classroom-based instruction in computer and customer service skills to actual employment via internships or social enterprises focused on providing real world work experience. Robust training programs will also support job seekers throughout the employment application and interview process, offer meaningful references and networking opportunities, and provide ongoing support during the inevitable ups and downs of employment.

Support for those who are disproportionately likely to experience homelessness.

Veterans, single mothers living in poverty, and individuals dealing with substance abuse, particularly those who are also living in poverty, are all disproportionately likely to become homeless, while at the same time facing multiple barriers to employment. To reduce their risk, we need more targeted outreach with services tailored to meet the needs of these groups, which can help them stabilize their lives so that they never become homeless in the first place. These services include assistance accessing health care, including mental health care and substance use recovery programs; legal assistance with collecting financial support from estranged or divorced partners; and affordable daycare.

While it is critical that we provide housing to reduce homelessness among individuals and families, the ultimate solution to ending homelessness must involve preventing it from occurring in the first place. That means reliable employment that pays decent wages—it means talking jobs as well as homes.

 

Related

Analysis

Addressing Basic Needs through Financial Empowerment

“I don’t have the bandwidth to talk about identity theft.” – Re-entry case manager

 “Front-line staff won’t take on a formerly incarcerated person’s debt; that’s outside their job description.” – program manager

 “Job developers can’t be expected to have the skills to take on jobseekers’ banking relationships.” – executive director

We often hear service providers suggest that people in crisis can’t afford to focus on their personal finances—that building financial security only makes sense after a person’s basic survival needs have been met. Many community-based organizations also say that financial empowerment is beyond the scope of what they can or should do.

These assumptions are not only outdated, they’re counterproductive.

Nearly 25 years ago, Dr. Michael Sherraden proved wrong those who doubted that poor people could save. His book Assets and the Poor, in which he called for Individual Development Accounts (IDAs)—matched savings accounts that would help low-income families build assets—went on to become a seminal body of work. It gave birth to a field and a new way of thinking about how to fight poverty. It also reminded us that a strengths-based approach to human and social services—one focusing on future outcomes and an individual’s self-determination and strengths—is not only empowering, it also produces results.

The Financial Clinic’s “New Ground Initiative” builds on Dr. Sherraden’s work by taking a broader look at how we think about financial empowerment. For many people struggling on the brink, financial security is about much more than home ownership or retirement planning; it requires tackling complicated challenges not often viewed as “financial”—such as barriers to rejoining one’s community after incarceration.

The New Ground Initiative seeks to increase the capacity of re‐entry programs—which serve individuals returning to their communities after incarceration—to address barriers to financial security. Formerly incarcerated individuals face many significant obstacles to economic security—such as barriers to employment, housing, public assistance, and education and training. Many of these barriers are the result of “collateral consequences”—penalties embedded in public policy that prevent people with criminal records from accessing basics such as a job, an apartment, or vital public assistance programs such as food stamps.

For many people struggling on the brink, financial security requires tackling complicated challenges not often viewed as “financial.”

The New Ground Initiative trains re-entry service providers on how to tackle these and other financial obstacles. These efforts have created powerful and inspiring achievements in the areas of employment, housing, and education.

For example, after returning home from incarceration, John (name changed) was worried about starting work and opening a bank account; he was afraid that his child support arrears would cause his new wages to be garnished. He is far from alone—unaffordable child support obligations are a major driver of post-incarceration debt. In fact, many formerly incarcerated individuals are released only to find that their child support debts have accumulated into the tens of thousands of dollars while they were behind bars. However, because of the training he did with New Ground, a job developer was able to help John modify his child support order to an affordable amount and then helped him open a bank account. The job developer also helped John set up direct deposit on his first day of work.

New Ground has also enabled re-entry programs to help their clients’ access housing opportunities. For example, Sarah was having trouble securing an apartment after returning home from incarceration. She had her credit report pulled by a re-entry service provider and they found that she was a victim of identity theft. The program referred Sarah to a financial coach, who was able to support her in getting the fraudulent debt removed, which in turn enabled her to rent an apartment.

Another re-entry program—focused on helping people achieve their educational goals after exiting jail or prison—reported that training with New Ground was fundamental to the program’s ability to help participants negotiate old student loan debt. Lowering monthly student loan payments allowed these individuals to make ends meet and return to school.

These successes confirm the Clinic’s model that strategies to build financial security in turn reduce barriers to basic needs. They also demonstrate that projects like the New Ground Initiative can help programs that serve justice-involved individuals achieve even better results.

You can stay informed about the Financial Clinic and help spread the word about its services by signing up here.

 

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