The welfare state faces a number of challenges. Recent reforms in the UK appear broadly successful in attaining targets and improving cost-efficiency, but are nonetheless confronted by public disquiet and unease. This article argues that one difficulty with the new directions in policy is that they rest on a particular and limited understanding of agency. Reformers tend to operate within a theoretical framework that understands behaviour as driven by individual and predominantly rational incentives and pays little attention to the expressive and normative aspects of social action. The problems that arise in these areas when a competitive market logic is applied in social provision tend not to be recognised. Such a logic may contradict estab...