Background: William Henry Beveridge, 1st Baron Beveridge, KCB (5 March 1879 - 16 March 1963) was a British economist who was a noted progressive and social reformer. He is best known for his 1942 report Social Insurance and Allied Services (known as the Beveridge Report) which served as the basis for the post-World War II welfare state put in place by the Labour government elected in 1945. He was considered an authority on unemployment insurance from early in his career, served under Winston Churchill on the Board of Trade as Director of the newly created labour exchanges and later as Permanent Secretary of the Ministry of Food. He was Director of the London School of Economics and Political Science from 1919 until 1937, when he was elected Master of University College, Oxford.
Context: An opportunity for Bevin to ease Beveridge out presented itself in May 1941 when Minister of Health Ernest Brown announced the formation of a committee of officials to survey existing social insurance and allied services, and to make recommendations. Although Brown had made the announcement, the inquiry had largely been urged by Minister without Portfolio Arthur Greenwood, and Bevin suggested to Greenwood making Beveridge chairman of the committee. Beveridge, at first uninterested and seeing the committee as a distraction from his work on manpower, accepted only reluctantly. The Report to the Parliament on Social Insurance and Allied Services was published in November 1942. It proposed that all people of working age should pay a weekly national insurance contribution. In return, benefits would be paid to people who were sick, unemployed, retired or widowed. Beveridge argued that this system would provide a minimum standard of living "below which no one should be allowed to fall". It recommended that the government should find ways of fighting the "five giants on the road of reconstruction" of Want, Disease, Ignorance, Squalor and Idleness. Beveridge included as one of three fundamental assumptions the fact that there would be a National Health Service of some sort, a policy already being worked on in the Ministry of Health. Beveridge's arguments were widely accepted. He appealed to conservatives and other sceptics by arguing that welfare institutions would increase the competitiveness of British industry in the post-war period, not only by shifting labour costs like healthcare and pensions out of corporate ledgers and onto the public account but also by producing healthier, wealthier and thus more motivated and productive workers who would also serve as a great source of demand for British goods. Beveridge saw full employment (defined as unemployment of no more than 3%) as the pivot of the social welfare programme he expressed in the 1942 report. Full Employment in a Free Society, written in 1944 expressed how this goal might be gained. Alternative measures for achieving it included Keynesian-style fiscal regulation, direct control of manpower, and state control of the means of production. The impetus behind Beveridge's thinking was social justice, and the creation of an ideal new society after the war. He believed that the discovery of objective socio-economic laws could solve the problems of society.
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Beveridge argued that this system would provide a minimum standard of living "below which no one should be allowed to fall".