Before the NHS was set up, healthcare was provided on a patchwork basis with many people having to pay directly for primary and hospital care services. The NHS was to be funded out of general taxation and based on the principal of being “free at the point of delivery”.
The aim of the NHS was to promote: “the establishment of a comprehensive health service designed to secure improvement in the physical and mental health of the people of England and Wales and the prevention, diagnosis and treatment of illness”.
It was not until after the Second World War that the British Welfare state took its mature form. In a climate of relief after the war, a climate diffused with an idealism for a new and just society. There was a clear sense of rebuilding a better Britain.
The period before World War Two had seen long-running debates about the lack of co-ordination of services. There was also concern to learn from existing experiences of a health insurance scheme for medical treatment for some of the population. There were many criticisms of the Poor Law including the indignities of means-tested payments and fear among the elderly, of ending life in the workhouse.
But the Labour Party landslide victory in 1945 was about creating a new deal for “the boys back from the front”, giving them a sense that their country had been worth fighting for and would support and care for them in peacetime, by offering them and their families jobs, homes, education, health and a standard of living of which they could be proud.
The centerpiece was a state-run system of compulsory insurance. Every worker, by contributing to a scheme of “national insurance” - deducted through wages - would help to build up a fund that would pay out benefits to those who were sick, unemployed, or suffered from war or industrial injury. The scheme would also pay pensions at the end of a working life to employees and the self-employed.
The idea was support the worker and family. Benefits were set at a level that enabled a man, his wife and child to survive. There would be benefits for widows and an allowance for guardians of children without parents. A system of “family allowance” for the second child and subsequent children was intended to ensure, that those with large families were not penalized.
There was also to be a marriage grant, maternity grant and some specific training grants and even a death grant. The key feature was that people were eligible to receive these benefits because they had contributed to the Welfare State. Rich and poor ‘paid the stamp’ and could claim as a right because of their National Insurance contributions.
Alongside these financial provisions for all, there would be universal access to education and to health services - the NHS. These would be funded through taxation and would be “free at the point of access”. Everyone in work would pay, but in this case, since taxation increased with income, the rich would pay more.
The welfare reforms gave meaning to the proud boast that the welfare state provided for everyone - 'from cradle to grave’. But for it to happen there had to be employment. The post war government would give top priority to the rebuilding of a strong, “peacetime economy” and the redeployment of British troops into civilian work.
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