The Benefit System

ASDA welfare cards: a precursor to welfare vouchers?

Part of the recent welfare changes has been the localisation of non-statutory emergency grants, such as Crisis Payments. Birmingham council has announced that Crisis Payments shall be handed out in the form of prepaid cards that can be used in the supermarket Asda[1]. Asda claims that its low prices represent an efficient use of public money. Spending would be restricted to a number of predetermined goods, excluding items such as tobacco, alcohol and fuel, restrictions that Claudia Wood, deputy director of the think tank Demos, said would be hard to enforce[2].

Opponents of the scheme claim that it is anti-competitive as Asda is the only supermarket in the scheme, though Birmingham Council claims that Asda was the only supermarket willing to work with the council[2]. However, even if other supermarkets were included, smaller shops and market traders who were not included will still miss out.

The scheme is reminiscent of the Ten Minute Rule Bill by Tory MP Alec Shelbrooke, proposing to provide out-of-work benefits through prepaid cash cards to ensure that benefits were only spent on essentials[3]. A poll commissioned by the think tank Demos suggested that 59% of people backed the move (rising to 77% to monitoring individuals with a history of substance abuse)[4] though Iain Duncan Smith has reportedly dismissed the idea[5].

  •  Are Birmingham council’s prepaid cards an efficient way of helping the poor?
  • If so, should prepaid cards be expanded to other benefits?
  • If not, is it salvageable in anyway, or unworkable and stigmatising?

 By Will Archdeacon

See Yes Minister’s previous posting on benefits being paid by cash







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