Leading Article: Welfare state in the balance sheet

THE moralistic tone of the Conservative Party conference rumbled in Kenneth Clarke's Budget. In the Chancellor's necessary efforts to control spending, his focus was inevitably on the welfare state, his target those judged undeserving. People faking long-term incapacity for work will be weeded out, and genuine invalids taxed. The workshy, taking time off pretending to be ill, can expect short shrift from big employers as the state stops reimbursing sick pay.

Those on the dole will have to demonstrate an eagerness to work. Sympathy runs thin if individuals fail to find jobs within six months: claimants will have to raid their savings before receiving income support. As for students, the banks - not the state - will have to bail them out. In a different vein, women will lose their right to a state pension at 60, five years earlier than men. The rationale for this privilege has disappeared in recent years.

These are the people who this year bear responsibility for relieving the burdens on the benefit system. The measures may seem dramatic but in many respects the Government has wielded the knife justifiably to target benefits where they are most needed. Invalidity benefit has been abused and the case is strong for equalising the state pension age at 65. Government funding of university education should rightfully be given lower priority than basic schooling.

But separating the deserving from the undeserving can be dangerous: vulnerable people may become scapegoats, as has been demonstrated during the past few months. And such discrimination may inadequately acknowledge that recession and demography play their part in the welfare state's difficulties. The division can too easily be a cover for attacks on those who are poorly defended by lobby groups: Mr Clarke was noticeably generous towards an NHS that nearly cost the Conservatives the last election. He has also been kind to pensioners who have wielded their grey power to defeat Conservatives in by-elections.

Single parents were saved further vilification. Indeed, Mr Clarke carried the day against the right by securing childcare support of up to pounds 28 a week for families claiming benefits. The move is consistent with confining help to the deserving poor. Many parents are anxious to improve their lot by working, but are prevented by the cost of child minders. The new allowance will particularly help families with children of school age and those living in areas where child care is cheaper.

This Budget has made important efforts to save waste and target benefits better. It has been less draconian than was anticipated, although much depends on how narrowly the criteria for sickness and unemployment are interpreted. Removing benefit from an incapacitated doctor who refuses to clean the streets will not pass the fairness test. But there are fears that the Chancellor may go on to remove help for significant groups of needy people. That would be a genuine crisis for the welfare state.