All taxpayers, employers and employees contribute to the cost of social security. The programme has two sources of finance.

• The cost of contributory benefits and their administration is met from the National Insurance Fund, to which all employers and employees contribute. The Fund also has income from its investments.

• Non-contributory benefits and their administration are financed from general taxation.

General taxation provides more than half of social security income, National Insurance contributions from employers around a quarter and National Insurance contributions from employees about a fifth.

How is the money spent?

The total social security budget in 1997-1998 was more than ₤ 92 billion, which is almost a third of all government spending. The pie chart top left show how the budget was spent on people who received benefits for the year 1997-1998. The pie chart bottom left shows how the money was spent in terms of benefits for the same year.

Who receives benefits?

More than 20 million people receive some sort of benefit in Britain. The elderly and the short-term sick receive predominantly contributory benefits, unemployment people receive mainly income related benefits, families mainly other benefits while the long-term sick and disabled receive all three types of benefit.

Benefits and who receives them

Group Benefit

Elderly people Retirement Pension

Non-contributory Retirement Pension

Christmas Bonus

The principal income-related benefits

Winter Fuel Payment

Long-term sick and disabled people Incapacity Benefit (long-term rate)

Attendance Allowance

Disability Living Allowance

Disability Working Allowance

Industrial Injuries Disablement Benefit

Other Industrial Injuries Benefit

Severe Disablement Allowance

Invalid Care Allowance

War Pensions

Independent Living Fund

Motability

Christmas Bonus

Principal income-related benefits

Short-term sick people Statutory Sick Pay

Incapacity Benefit (short-term rate)

Principal income-related benefits

Families Child Benefit

Family Credit

Statutory Maternity Pay

Maternity Allowance

Maternity Grant

Principal income-related benefits

Unemployed people Unemployment Benefit

Jobseeker's Allowance

Principal income-related benefits

Widows and others Widow's Benefits

War Widow's Pensions

Guardian Allowance and Child's Special Allowance

Industrial Death Benefit

Social Fund Funereal Payments

Earnings Top-up Pilots

Income support paid to people who do not fall within the other client groups

How is Social Security organised?

The Department of Social Security (DSS) comprises a small central headquarters which support the Secretary of State for Social Security and a team of Ministers in developing policy, and five executive agencies. Most of the services in Great Britain are run by the separate agencies.

Executive agencies of the DSS

The Benefits Agency - pays most social security benefits

The Child Support Agency - collects child maintenance from absent parents

The War Pensions Agency - administers benefits and delivers services for war pensioners and their dependants

Date: 2016-01-03; view: 951