Welfare state in the United Kingdom in the context of "Thatcherism"

David Lloyd George, 1st Earl Lloyd-George of Dwyfor (17 January 1863 – 26 March 1945) was Prime Minister of the United Kingdom from 1916 to 1922. A Liberal Party politician from Wales, he was known for leading the United Kingdom during the First World War, for social-reform policies, for his role in the Paris Peace Conference, and for negotiating the establishment of the Irish Free State.

Born in Chorlton-on-Medlock, Manchester, and raised in Llanystumdwy, Lloyd George gained a reputation as an orator and proponent of a Welsh blend of radical Liberal ideas that included support for Welsh devolution, the disestablishment of the Church of England in Wales, equality for labourers and tenant farmers, and reform of land ownership. He won an 1890 by-election to become the Member of Parliament for Caernarvon Boroughs, and was continuously re-elected to the role for 55 years. He served in Henry Campbell-Bannerman's cabinet from 1905. After H. H. Asquith succeeded to the premiership in 1908, Lloyd George replaced him as Chancellor of the Exchequer. To fund extensive welfare reforms, he proposed taxes on land ownership and high incomes in the 1909 People's Budget, which the Conservative-dominated House of Lords rejected. The resulting constitutional crisis was only resolved after elections in 1910 and passage of the Parliament Act 1911. His budget was enacted in 1910, with the National Insurance Act 1911 and other measures helping to establish the modern welfare state. He was embroiled in the 1913 Marconi scandal but remained in office and secured the disestablishment of the Church of England in Wales.

Universal Credit is a United Kingdom based social security payment. It is means-tested and is replacing and combining six benefits, for working-age households with a low income: income-related Employment and Support Allowance (ESA), income-based Jobseeker's Allowance (JSA), and Income Support; Child Tax Credit (CTC) and Working Tax Credit (WTC); and Housing Benefit. An award of UC is made up of different elements, which become payable to the claimant if relevant criteria apply: a standard allowance for singles or couples, child elements and disabled child elements for children in the household, housing cost element, childcare costs element, as well as elements for being a carer or for having limited capability to work-related activities, due to illness or disability.

The new policy was announced in 2010 at the Conservative Party annual conference by the Secretary of State for Work and Pensions, Iain Duncan Smith, who said it would make the social security system fairer to claimants and taxpayers. At the same venue the Welfare Reform Minister, Lord Freud, emphasised the scale of their plan, saying it was a "once in many generations" reform. A government white paper was published in November 2010. A key feature of the proposed new benefit was that unemployment payments would taper off as the recipient moved into work, not suddenly stop, thus avoiding a "cliff edge" that was said to "trap" people in unemployment.

Employment and Support Allowance (ESA) is a United Kingdom welfare payment for adults younger than the State Pension age who are having difficulty finding work because of their long-term medical condition or a disability. It is a basic income-replacement benefit paid in lieu of wages. It is currently being phased out and replaced with Universal Credit for claimants on low incomes, although the contribution-based element remains available.

Personal Independence Payment (abbreviated to PIP and usually pronounced as one word) is a welfare benefit in the United Kingdom intended to help working-aged people 16 and over with the extra costs of living with a health condition or a disability. It is available in England, Wales and Northern Ireland but not in Scotland, where Adult Disability Payment (ADP) is available instead.

It is non-means tested, non-contributory and tax-free; it is not linked to a person's ability to work and it is available equally to people in or out of work. It is not intended to be a substitute for a person's earnings, unlike Universal Credit, Employment and Support Allowance (ESA) or ESA's predecessor, Incapacity Benefit.

One-nation conservatism, also known as one-nationism or Tory democracy, is a form of British political conservatism and a variant of paternalistic conservatism. It advocates the "preservation of established institutions and traditional principles within a political democracy, in combination with social and economic programmes designed to benefit the ordinary person". According to this political philosophy, society should be allowed to develop in an organic way, rather than being engineered. It argues that members of society have obligations towards each other and particularly emphasises paternalism, meaning that those who are privileged and wealthy should pass on their benefits. It argues that this elite should work to reconcile the interests of all social classes, including labour and management, rather than identifying the good of society solely with the interests of the business class.

The descriptive phrase 'one-nation Tory' originated with Benjamin Disraeli (1804–1881), who served as the chief Conservative spokesman and became Prime Minister in February 1868. He devised it to appeal to working-class people, who he hoped would see it as a way to improve their lives via factory and health acts as well as greater protection for workers. The ideology featured heavily during Disraeli's two terms in government, during which considerable social reforms were passed by the Parliament of the United Kingdom. Towards the end of the 19th century, the Conservative Party moved away from paternalism in favour of free market capitalism. In the first half of the 20th century, fears of extremism saw a revival of one-nation Conservatism. The Conservative Party continued to espouse the philosophy throughout the post-war consensus from 1945. One-nation thinking influenced their tolerance of the Labour government's Keynesian intervention in the economy, formation of a welfare state and the National Health Service. Thanks to Iain Macleod, Edward Heath and Enoch Powell, special attention after 1950 was paid to one-nation conservatism that promised support for the poorer and working class elements in the Party coalition.

The United Kingdom has a highly developed social market economy. From 2017 to 2025 it has been the sixth-largest national economy in the world measured by nominal gross domestic product (GDP), tenth-largest by purchasing power parity (PPP), and about 21st by nominal GDP per capita, constituting 3.38% of world GDP and 2.13% by purchasing power parity (PPP).

The United Kingdom has one of the most globalised economies and comprises England, Scotland, Wales and Northern Ireland. In 2022, the United Kingdom was the fifth-largest exporter of goods and services in the world and the fourth-largest importer. It also had the fourth-largest outward foreign direct investment, and the fifteenth-largest inward foreign direct investment. In 2022, the United Kingdom's trade with the European Union accounted for 42% of the country's exports and 48% of its total imports. The United Kingdom has a highly efficient and strong social security system, which comprises roughly 24.5% of GDP.