Individuals may apply for welfare due to disability, lack of education or job training, a low demand for unskilled labor, or substance abuse. Assistance may also take the form of other relief, such as tax credits for working mothers.
Welfare is known by a variety of names in different countries, all with the avowed purpose of providing an economic or social safety net for disadvantaged members of society. Almost all developed nations provide some kind of safety net of this kind; nations where such programs are especially prominent are known as welfare states.
The desired outcome and purpose of welfare varies. For welfare for the non-disabled, the purpose often is to prevent complete destitution. Welfare or assistance for the disabled, in contrast, does not eventually expect non-dependency, and the justification is more philosophical.
"Corporate welfare," usually in the form of favorable tax policy, is sometimes used in order to provide capital to an industry that the government perceives needs financial assistance in order to survive or to expand, or which the government wishes to support for political or economic purposes.
Some of these ideal outcomes and purposes, as well as welfare's effectiveness have been challenged by political lobbies such as those who oppose big government and "forced charity", such as minarchists or libertarians.
The amounts paid to recipients are typically modest, and may fall below the poverty line. Recipients must usually demonstrate a low level of income such as by way of "means testing", or financial hardship, or that they satisfy some other requirement such as childcare responsibilities or disability.
Those receiving unemployment benefits may also have to regularly demonstrate that they are periodically searching for employment. Some countries assign specific jobs to recipients who must work in these roles in order for welfare payments to continue. In the United States and Canada, such programs are known as workfare.
Corporate welfare is supposed welfare on a larger scale for entities and companies. The term is often pejorative.
The term was originally coined by Ralph Nader in 1956. The concept of "corporate welfare" creates a satirical association between corporate subsidies and welfare payments to the poor, and implies that corporations are much less needy of such treatment than the poor; as such, the term is usually used by those who oppose such handouts to corporations. One of the questions on the World's Smallest Political Quiz asks the reader whether or not he/she supports ending "corporate welfare"; this is one of the questions used to differentiate between different political ideologies (centrist, liberal, conservative, statist and libertarian).
The concepts of welfare and pension were introduced in early Islamic law of the Caliphate as forms of Zakat (charity), one of the Five Pillars of Islam, since the time of the Abbasid caliph Al-Mansur in the 8th century. The taxes (including Zakat and Jizya) collected in the treasury of an Islamic government was used to provide income for the needy, including the poor, elderly, orphans, widows, and the disabled. According to the Islamic jurist Al-Ghazali (Algazel, 1058-1111), the government was also expected to store up food supplies in every region in case a disaster or famine occurs.
There is relatively little statistical data on welfare transfer payments until at least the High Middle Ages. In the medieval period and until the Industrial Revolution, the function of welfare payments in Europe was principally achieved through private giving or charity. In those early times there was a much broader group considered in poverty compared to the 21st century.
Early welfare programs included the English Poor Law of 1601, which gave parishes the responsibility for providing welfare payments to the poor. This system was substantially modified by the nineteenth-century Poor Law Amendment Act, which introduced the system of workhouses.
It was predominantly in the late nineteenth and early twentieth centuries that an organized system of state welfare provision was introduced in many countries. Otto von Bismarck, Chancellor of Germany, introduced one of the first welfare systems for the working classes. In Great Britain the Liberal government of Henry Campbell-Bannerman and David Lloyd George introduced the National Insurance system in 1911, a system later expanded by Clement Attlee. The United States did not have an organized welfare system until the Great Depression, when emergency relief measures were introduced under President Franklin D. Roosevelt. Even then, Roosevelt's New Deal focused predominantly on a programme of providing work and stimulating the economy through public spending on projects, rather than on cash payments.
In the late twentieth century, a perception grew that existing welfare systems were becoming excessively bureaucratic and inefficient. The United States Social Security system has come under particular criticism, and many political figures, such as George W. Bush, have argued for a more work-based system of welfare provision.