Stopping benefit payments increases criminal activity – and ends up costing governments more
A study of US citizens who had their welfare payments cut shows that removing cash support leads to more criminal activity later down the line.
People with mental and behavioural conditions who have their cash welfare benefits removed when they turn 18 go on to receive 20 per cent more criminal charges in the 20 years following, a study in the US has found.
The increase in criminal activity also upped the likelihood of individuals going to jail, which researchers say cost the US government substantially more than they saved in removing the benefits.
The new study, published in the Quarterly Journal of Economics, focused on a change in social welfare programmes made in 1996 to cut spending. Prior to the change, disabled children would continue to receive their benefits even after they turned 18, unless their condition has demonstrably improved since their first assessment. But since 1996, all children receiving the Supplemental Security Income benefit were reassessed at 18.
Because the definition of disability used in the assessments is different for adults and children, the researchers say some conditions that might qualify a child for the benefit wouldn't qualify an adult. For example, a child with ADHD in a low-income family would be eligible for support, but unless their ADHD was judged "to be severe enough to preclude work", they wouldn't get welfare past their 18th birthday.
This meant that 40 per cent of children lost their benefits when they became adults. For those, even though the aim was to encourage employment, the study found that they were twice as likely to receive a criminal charge as they were to get a steady job.
"Over time, youth specialise in either legal employment or criminal activity to generate income: although some youth with steady formal employment have one criminal charge in adulthood, almost none of the steadily employed youth have multiple criminal charges," wrote the study's authors, Prof Manasi Deshpande and Prof Michael Mueller-Smith.
While it saved the government an estimated $49,100 (£39,160) per person, economists Deshpande and Mueller-Smith say the resulting increase in crime cost a lot more.
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The 20 per cent increase in the number of criminal charges involved 'income-generating crimes', the study's authors note, which include things like theft, fraud and prostitution. This meant that each person who lost their benefits was estimated to create $10,800 (£8,610) in police and court costs.
Researchers also found that the likelihood of incarceration increased by 60 per cent, adding another $30,200 (£24,080) in prison costs. On top of this, the team estimated the costs to society in general, including the victims of crime but also the wider general public, who may take precautionary measures against crime. These costs equalled $85,600 (£68,260). This means that the cost of cutting one person's benefit, even including the cash saving, is $77,500 (£61,820).
"On the one hand, cash assistance could provide a basic level of income and well-being to youth who face barriers to employment and thereby reduce their criminal justice involvement," wrote Deshpande and Mueller-Smith.
"On the other hand, welfare benefits could discourage work at a formative time and discourage the development of skills, good habits, or attachment to the labor force, potentially even increasing criminal justice involvement... [but] in response to losing benefits, youth were twice as likely to be charged with an illicit income-generating offence than they were to maintain steady employment."
Many argue that benefits affect income by reducing earnings and employment, but this new study suggests the benefits of the welfare system outweigh the costs. This anti-crime income effect, the authors say, has long-term benefits for would-be offenders and society at large.
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Amy is the Editorial Assistant at BBC Science Focus. Her BA degree specialised in science publishing and she has been working as a journalist since graduating in 2018. In 2020, Amy was named Editorial Assistant of the Year by the British Society of Magazine Editors. She looks after all things books, culture and media. Her interests range from natural history and wildlife, to women in STEM and accessibility tech.