This article looks at the way in which the role of the state has evolved within different aspects of welfare activity (broadly defined) in the United Kingdom since 1979 and forward to the possible impacts of the plans of the Coalition government that took office in 2010 for changing that role through reform and fiscal retrenchment. Even as governments restrained the growth of public social spending, total public and private activity grew by more than 150 per cent in real terms between 1979--80 and 2007--8, and from 34 to 42 per cent of GDP. If state services have not grown rapidly enough, some have paid more privately for the services they want, and in other cases governments have ended up financing activity through indirect routes. There has always been a 'mixed economy' of welfare in terms of the balance between public and private provision, finance, and control. Changes in this balance have been slow, with the largest growth being in the 'pure private sector' (with private provision, finance, and control), but with some growth in publicly financed services that are contracted out to the private sector. The experience suggests that the Coalition government's initial ambitions for radically transforming the overall structure of public--private boundaries may be hard to realize. Copyright 2011, Oxford University Press.
