Charging Ahead? Spreading the costs of modern public services

All countries use some form of co-payment in the delivery of public services.

The extent of co-payment, however, very much depends on the historical political settlement and the culture of the country in question. In the UK, the development of the welfare state through Beveridge and the 1945 Labour Government has meant there has been less of a role for co-payment, though there are notable exceptions. In the foreseeable future, however, an uncertain economic climate and potential budget deficits may force policy makers to once again consider the introduction or extension of user charges.

This report outlines the current pattern of co-payment in the UK and debates whether there is a case for introducing or extending co-payment into new areas of public service provision. It considers the economic rationale and the principles that should underpin the use of co-payment in UK public services, in particular the impact on equity.

The potential for extending co-payment or introducing new charges is investigated in three areas: health, higher education and local government. Contributors include: Sarah Smith, Bristol University; Prof. Stephen Bailey, Glasgow Caledonian University; Prof. Peter Smith, York University; Alissa Goodman, Institute for Fiscal Studies; and Jessica Asato, SMF

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