1964-1970 The Welfare State under Labour

The cost of the Welfare State continued to rise. This was a surprise - but also a headache. Evidence showed that poverty and misery continued in Britain. The researcher, Peter Townsend, calculated that 6-9 per cent of the population in the 1960s were in poverty and up to 28 per cent were on the poverty line. In 1965, in response to a claim that 720,000 children were living in poverty, the Child Poverty Action Group was formed.

Department of Health and Social Security (DHSS)

In 1968 the government created a huge new department called the Department of Health and Social Security (DHSS). It took over the old National Assistance Board (NAB) as well as many others and introduced supplementary benefits to top up existing benefits. Although people were kept above a new unofficial poverty line, many thousands were living only just above it.

Between 1951 and 1980 the number of people receiving either National Assistance or Supplementary Benefit rose from 1.5 million to 3.3 million. A major cause of this was low wages. Family Income Supplement was introduced in 1971, providing grants towards essential items like cookers, or entitlement to free school meals. Today, Working Families Tax Credit has taken its place. Family Income Supplement targeted low-income families and partly a response to another problem - despite the growing welfare budget; millions of pounds in benefits were actually going unclaimed.