Tag: tax credits

Osborne’s tax credit cuts omnishambles

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The Chancellor, George Osborne, has recently announced that the Conservatives are a true “workers party”  – claiming that his opponents, the Labour Party, represent the unemployed. But the Conservatives are attempting to re-write history: the Labour Party grew from the Trade Union Movement, and have a strong tradition of supporting worker’s rights and fair wages, and of course the Unions have retained close institutional links with the Labour Party.

Osborne has argued, somewhat absurdly, that reducing tax credit payments to people in low paid jobs would give them “economic security” by reducing the Government’s spending deficit. Labour argues that the richest should pay to cut the deficit, and has identified cuts to tax avoidance and corporate subsidies that could replace cuts to the lowest paid. Osborne’s priorities reflect a traditional Conservative ideology.

As Richard Murphy, from Tax Research UK, points out:

“… the government is forcing the burden of risk bearing onto those least able to bear it in society – that is those with the lowest income. So just as we now know inequality, especially concerning wealth, is rising rapidly, insecurity is also increasing exponentially as risk is being passed from those with the capacity to bear it to those who have not.”

Osborne’s “long-term economic plan” isn’t without controversy. According to many economists, during recessions, the government can stimulate the economy by intentionally running a deficit. The budget deficit is the annual amount the government has to borrow to meet the shortfall between current receipts (tax) and government spending.

Of course, last year, serious doubts were raised regarding Osborne’s deficit targets after the treasury met a significant tax revenue shortfall. Osborne’s obsession with deficit cutting and the Conservative small-state ideology has clearly overlooked the problems created by poor pay and high living costs, which has impacted detrimentally at both a micro and macro level, creating an economic spiral of cuts and stagnation. And it has widened inequality significantly.

In order to keep his promises on further future tax cuts for higher earners, Osborne will invariably make even more cuts to public services, public sector pay and the social security safety net that are so deep they will severely damage both the economy and potentially, the fabric of our society.

The Institute for Fiscal Studies (IFS) have recently criticised George Osborne’s proposed tax credit cuts, because it is “at odds” with wider Conservative stated aims to “support hardworking families”.

Research conducted by the IFS calculated that only around quarter of money take from families through tax credit cuts would be returned by the new National “Living Wage”.

Tax credits are payments made by the Government to people on lower incomes, most of whom are in work.

It was announced today that the Work and Pensions Committee is holding an urgent evidence gathering session on the proposed reforms to the tax credit system on Monday 26 October. The Committee will question representatives of respected independent think tanks that have analysed the impact of the Conservative plans, including the IFS and the Resolution Foundation, who revealed that the planned welfare cuts will lead to an increase of 200,000 working households living in poverty by 2020, and that almost two-thirds of the cut would be borne by the poorest 30 per cent of households, whilst almost none of the cuts will fall upon the richest 40 per cent of households.

A Labour motion calling on the government to rethink the controversial tax credit cuts has been defeated in the Commons. But despite Labour losing the vote today, the debate saw a number of Tory MPs attack the proposed changes, too.

In her maiden speech today, Tory MP Heidi Allen said that her party risks betraying its values, as she voiced her opposition to tax credit cuts.

She suggested ministers were losing sight of the difficulties of working people in their “single-minded determination to achieve a [budget] surplus”. She also said that the tax credit changes do not pass the “family test”, warning that the pace of the reforms is “too hard and too fast”.

The opposition day motion called for a reversal of the policy but MPs voted against it by 317 to 295 – a government majority of just 22. Next week, the vote in the House of Lords was set to be far closer, with the very real possibility that on Monday, Peers would  vote to block the changes. Because the tax credit cut proposals were not in the Tory manifesto, it means they are not bound by the usual Salisbury convention that prevents the peers from blocking election promises.

Also, the tax credit cuts were not included in the Finance Bill, which normally enacts a Budget, and the opposition have used the opportunity to seize on the fact that a Statutory Instrument can be halted by a single House of Lords vote.

Mr Cameron effectively ruled out cutting the benefit before the election, telling a voters Question time that he “rejected” proposals to cut tax credits and did not want to do so.

The cuts are part of £12bn cuts to the social security budget that the Government is to make – the details of which the Conservatives refused to announce before the election.

However, in an unprecedented move, the Conservatives have threatened a constitutional “showdown”, and have refused to engage in dialogue with peers that want kill off the proposed Tory cuts. The government warned the House of Lords it would trigger a full-scale constitutional crisis by pressing ahead with their plans.

Despite the fact that the chancellor faces a growing rebellion against the cuts among Tory MPs, the government told the group of crossbench peers that they also “risked” a renewed push to weaken the powers of the upper house if they refused to back down.

The threats from the government that came because it was facing probable defeat on what is an extremely unpopular reform, even amongst their own party ranks, are truly remarkable, showing a contempt for democratic process and a lack of willingness to engage in transparent dialogue. They came after Lady Meacher, a crossbencher who is the former chair of the East London NHS Trust, threatened to table a “fatal motion” to kill off the cuts to tax credits.

The Tories do not have a majority in the Lords and faced defeat after Labour and the Liberal Democrats said they would support Lady Meacher.

It is understood that Meacher withdrew her fatal motion on Tuesday night and announced she would table a motion calling on the government to deliver a report responding to the warning by the Institute for Fiscal Studies that 3 million families would lose over £1,000 a year.

Meacher told the Guardian today:

My plan at the moment is to put down a motion which will prevent this regulation being approved on Monday, which will require the government to produce a report responding to the IFS analysis and consider mitigating action before bringing it back. This gives time to the House of Commons to go on doing what they are doing. There are Tory MPs horrified by this.

So we are giving the government time to think again, but the word fatal would not be appropriate. This is causing a great deal of consternation at government level and we are trying to find a way through which will ensure that the government revisits these regulations

This move will also allow time for the Work and Pensions Committee to gather further evidence to present to the government, too. The Committee have stated that they will ask representatives questions on the following topics;

  • The impact of the April 2016 tax credit cuts (in isolation and in the context of other welfare measures in the Summer Budget), and the National Living Wage
  • The winners and losers and their characteristics
  • The extent to which the National Living Wage will compensate individuals receiving lower tax credit payments
  • The distributional impact of these measures, individually and combined
  • The scale of the financial gains/losses to households and what influences this
  • The quality of the analysis produced by the Government to support their proposals
  • Other options for achieving savings from the tax credit system that will mitigate the impact on the least well off
  • The implications for work incentives and the Government’s wider objectives in welfare reform

Select Committees work in both Houses of parliament. They check and report on areas ranging from the work of government departments to economic affairs. The results of these inquiries are made public and the Government must respond to their findings.

A select committee is a cross-party group of MPs or Lords given a specific remit to investigate and report back to the House that set it up. Select committees are one of the key ways in which Parliament makes sure the Government is adequately scrutinised, held to account, and has to explain or justify what it is doing or how it is spending taxpayers’ money.

Committee findings are reported to the Commons, printed, and published on the Parliament website. The government then usually has 60 days to respond to the committee’s recommendations.

The Osborne omnishambles is far from done and dusted yet.

555114_453356604733873_1986499794_nPictures courtesy of Robert Livingstone

Austerity Is a Choice, Labour Must Offer Another – Jeremy Corbyn

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Austerity is a political choice not an economic necessity. When the Chancellor rose to his feet at the emergency Budget in July, and when he does so for his Spending Review in October, what is being put forward is an ideologically-driven rolling back of the state.

The analysis published today by the TUC reveals how the Budget gives money to the rich, but takes away from the poor.

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This is the Conservative project, dressed up in the post-crisis language of budget deficits and national debt for extra impetus. Inequality doubled under the Thatcher government, and her heirs seem to be doing all they can to ensure that legacy is extended.

The Budget showed austerity is about political choices, not economic necessities. There is money available: the inheritance tax cuts announced in the Budget will lose the exchequer over £2.5billion in revenue between now and 2020. What responsible government committed to closing the deficit would give a tax break that only applies to the richest 4% of households?

The Conservatives are giving away to the very rich in inheritance tax cuts twice as much as reducing the benefit cap will raise by further impoverishing the poorest, and socially cleansing many towns and cities.

Another choice was to cut UK corporation tax to 18%, which at 20% is already the lowest in the G7, lower too than the 25% in China, and half the 40% rate in the United States.

The Treasury estimates that this political choice will see our revenue intake from big business fall by £2.5billion in 2020. That’s nearly twice the amount saved by cutting the tax credits available families with more than two children.

In such circumstances, Labour must be clear: we oppose the Budget, and we oppose austerity. As a group of 40 economists wrote to the Observer a few weeks ago, “opposition to austerity is actually mainstream economics, even backed by the conservative IMF”.

The language of “bringing down the deficit” is non-controversial, it is the method (austerity) that reveals the Chancellor’s agenda as just a cover for the same old Conservative policies: run down public services, slash the welfare state, sell-off public assets and give tax cuts to the wealthiest.

I stood in this race because Labour should not swallow the story that austerity is anything other than a new facade for the same old Conservative plans.

We must close the deficit, but to do so we will make the economy work for all, and create a more equal and prosperous society. Bringing down the deficit on the backs of those on low and average incomes will only mean more debt, more poverty, more insecurity, more anxiety and ultimately more crisis.

We must invest in a more productive economy. Our national infrastructure – energy, housing, transport, digital – is outdated, leaving the UK lagging behind other developed economies. In the Budget, the Chancellor cut back public investment even further.

You cannot cut your way to prosperity. We need to invest in our future. And that takes a strategic state that seeks to shape the economy so that it works for all.

That is the choice for Britain and the choice that Labour must offer.

Jeremy Corbyn is the Labour MP for Islington North and Labour Party leader.

This article was originally published on 7.09.15

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Pictures courtesy of Robert Livingstone

 

Lies, Damn Lies and the Welfare Debate – Emily Thornberry

proper Blond

Originally published in the Huff Post on 13 July, 2015

Next week the Government plans to bring forward a new Bill on welfare reform – the latest salvo in the Tories’ ongoing war of attrition on our welfare state and the principles that underpin it.

Softening up the ground for this next round of cuts, which will go further and deeper than anything we’ve seen so far, was a column written jointly by George Osborne and Iain Duncan Smith and published in the Sunday Times a few weeks ago.

The piece, which reads like a greatest hits compilation of clichéd Tory platitudes on welfare spending, was so shot through with errors, misleading implications and flat-out lies that it set the tone for the most ill-informed debate in recent memory.

So in the interest of setting the record straight, I’ve picked out my top eight tall Tory tales (there are many more than eight, but as space is limited I’ve kept myself to the worst offenders) and put them together with the actual facts. Without a willing handmaiden in the Murdoch press empire to help me, I’m relying on you to spread the word:

Lie number one:
“This country accounts for 7% of all welfare spending in the world, although we have just 1% of its population and produce 4% of its GDP.”

Even if you accept that these figures are accurate (and there’s no reason why you should – Osborne and Duncan Smith did not provide a source and I haven’t been able to find one) the implication – that we are spending more than we should because our welfare budget is out of proportion to our share of the global population – is ridiculous because it does not compare like with like.

To say that we spend more on welfare per head than, say, Somalia or Zimbabwe tells you nothing more than the fact that we have an advanced, industrialised economy, a domestic tax base, an established democracy and a modern welfare state, which many countries do not.

A much more valuable comparison would be between the UK and other industrialised democracies, for example within Europe. A comparison with the rest of Europe puts us below the average in terms of welfare spending as a proportion of GDP.

Lie number two:
Under Labour “Britain’s welfare bill was fast becoming completely unsustainable.”

Taking as a measure of “sustainability” the amount we spend on social security as a proportion of GDP (the most widely used measure), welfare spending stayed virtually flat during Labour’s time in office. Between 1998-99 and 2008-09 welfare spending represented on average 10.7% of GDP, never deviating more than 0.2% from this figure in any given year.

When the global financial crisis hit the proportion rose to 13% – a significant rise which nonetheless was neither surprising nor particularly concerning, given the historic tendency for welfare spending to rise during a depressed economy and fall back down to normal levels with the return of economic growth.

It’s also a bit rich for the Tories to preach about an increasing welfare budget when the bulk of social security expenditure in the UK goes to pensioners, an area where the Tories have increased spending, not cut it.

Lie number three:
“Not that any of this debt-fuelled largesse improved lives.”

Maybe not the lives of anybody the authors knew, but the truth is that, largely thanks to the support Labour provided to low-income working families through tax credits (which Osborne is about to gut), child poverty fell by a third under Labour – equivalent to more than a million children lifted out of poverty.

IDS may be busy redefining poverty so he can pretend it doesn’t exist, but I think most people can still understand that poverty is real, that it isn’t a good thing and that a person moving out of poverty would normally consider the change an improvement in their life.

Lie number four:
“The welfare system we inherited in 2010 trapped people in dependency and actively discouraged claimants from seeking work. All too often, those who worked hard and did the right thing were punished – while those who did the wrong thing were rewarded.”

Presumably what the authors mean by “doing the right thing” is working. But despite their best efforts to draw an artificial dividing line between “work” and “welfare”, the reality is that most people of working age who claim some kind of benefit do work. For example, more than two thirds of people claiming tax credits are employed, and tax credits account for around 50% of all spending on working-age welfare. Meanwhile, benefits specifically for people who are out of work, like Jobseeker’s Allowance and Income Support, make up just 3% of such spending.

The fact of the matter is that when governments fail – as the Tories have done – to tackle the root causes of working peoples’ need for welfare support, like low pay and high rents, the number of working people relying on benefits increases. For example, the proportion of housing benefit claimants who are employed has doubled since the Tories took office in 2010.

Lie number five:
“The new benefit cap of £26,000 a year means that no household can receive more in out-of-work benefits than the average working family earns, a simple matter of fairness.”

The Tories’ cap has nothing to do with fairness, as demonstrated by the fact that their new Bill abolishes the cap’s link with average earnings and gives Ministers carte blanche to lower the cap arbitrarily, at any time and for any reason.

Their cap also takes an across-the-board approach, affecting many more people who aren’t able to work – including people with disabilities, single mothers with young children and people with full-time caring responsibilities for sick or severely disabled relatives – than people who are.

Lie number six:
“We also took action to cap the rise in benefits so it was in line with the incomes of those in work.”

They did no such thing. Since 1980, the main out-of-work benefits have risen in line with prices, rather than earnings. So Jobseeker’s Allowance fell from being worth a fifth of average earnings in 1980 to a tenth in 2010.

Lie number seven:
“In 1980, working age welfare accounted for 8% of all public spending. In 1990, when Margaret Thatcher left office, it was still under 10%. But by 2010 it had risen to nearly 13% of public spending.”

Similar to lie number two, but since the lie is repeated (or, to put it more charitably, the highly selective and misleading half-truth) the truth might as well be repeated too. As noted, welfare reform stayed virtually flat under Labour until a sudden increase was brought about as a result of a recession – just as had happened in the early 1990s under John Major’s Government.

Lie number eight:
“This government was elected with a mandate to implement further savings from the £220 billion welfare budget.”

They most certainly were not. The Tories ran on a manifesto promising £12billion worth of welfare cuts, a figure which no-one took seriously in large part because they failed to specify where the savings would come from.

Happy myth-busting, readers!

Emily Thornberry.

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See also:

The reasons why we can’t afford not to have a welfare state are not ideological: they are practical – A brief history of social security and the reintroduction of eugenics by stealth

The welfare state: from hung, drawn and quartered to Tory privatisation

The budget: from trickle-down to falling down, whilst holding hands with Herbert Spencer.

14533697838_dffcc736f2_o (1)Pictures courtesy of Robert Livingstone

A brief history of social security and the reintroduction of eugenics by stealth

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Introduction

Our welfare state arose as a social security safety net – founded on an assurance that as a civilised and democratic society we value the well-being and health of every citizen.

There was a cross-party political consensus that such provision was in the best interests of the nation as a whole at a time when we were collectively spirited enough to ensure that no one should be homeless or starving in modern Britain.

As such, welfare is a fundamental part of the UK’s development –  our progress – the basic idea of improving people’s lives was at the heart of the welfare state and more broadly, it reflects the evolution of European democratic and rights-based societies.

Now the UK “social security” system is anything but. It has regressed to reflect the philosophy underpinning the 1834 Poor Law, to  become a system of punishments aimed at the poorest and most marginalised social groups. The Poor Law principle of less eligibility – which served as a deterrence to poor people claiming poor relief is embodied in the Conservative claim of Making work pay: benefits have been reduced to make the lowest paid, insecure employment a more appealing option than claiming benefits.

Unemployed people have absolutely no bargaining power or choice regarding their work conditions and pay. They are coerced by the state to apply for any work available. This also negatively impacts on collective bargaining more widely, the creation of a desperate reserve army of labor serves to drive wages down further. (See: Conservatism in a nutshell.)

The draconian benefit sanctions are about depriving people of their lifeline benefits because they have allegedly failed to comply in some way with increasingly stringent welfare conditionality – which is aimed at enforcing compliance, “behaviour change” and achieving reductions in welfare expenditure rather than supporting people claiming benefits and helping them to find work.

Removing a person’s means of meeting basic survival needs presents significant barriers to that person finding work. If we can’t meet our basic needs, we cannot be motivated or “incentivised” to do anything but struggle for survival.

Abraham Maslow’s hierarchy of needs.

 

Such a political aim of “behaviour change” is founded entirely on assumptions and moral judgements about why people are unemployed or underpaid. And of course serious concerns have arisen because sanctions have tended to be extremely discriminatory. Young people, women with childcare responsibilities, people with learning disabilities, people with mental illnesses and disabled people are particularly vulnerable as a consequence of the rigid conditionality criteria.

Frankly, such an approach to welfare seems to be cruelly designed to exclude those people who need support the most. Not only does the current government fail to recognise socio-economic causes of poverty, poor wages, underemployment and unemployment because of political decision-making – preferring to blame individuals for economic misfortune – it also fails to recognise the detrimental wider social and economic implications of penalising poor people for the conservative engineering of a steeply hierarchical society.

As a government that values social inequality, and regards it as necessary for economic growth, insolvency and poverty for some is intrinsic to the Conservative ideological script and drives policy decisions, yet the Tories insist that individuals shape their own economic misfortunes.

Worse, the Conservatives are prepared to leave people without a basic means of support – one that the public have paid for themselves.

Austerity – which is aimed at the poorest members of society – has served to increase inequality, and since the Tory welfare “reforms,” we have seen a re-emergence of absolute poverty. Up until recently, our welfare system ensured that everyone could meet their basic survival needs. That no longer is the case.

A brief history of welfare

A welfare state is founded on the idea that  government plays a key role in ensuring the protection and promotion of the economic and social well-being of its citizens. It is based on the principles of equality of opportunity, equitable distribution of wealth, and both political and social responsibility for those unable to avail themselves of the minimal provisions for well-being.

It was recognised that people experienced periods of economic difficulty because of structural constraints such as unemployment and recession, through no fault of their own. It was also recognised that poor health and disability may happen to anyone through no fault of their own.

The welfare state arose in the UK during the post-war period, and following the Great Depression, for numerous reasons, most of these were informed by research carried out into the causes of poverty, its effects on individuals and more broadly, on the UK economy. There were also political reasons for the Conservatives and Liberals supporting the poorer citizens – the newly enfranchised working class.

Charles Booth in London and Sebohm Rowntree in York carried out the first serious studies of poverty and its causes. They both discovered that the causes were casual labour, low pay, unemployment, illness and old age – not laziness, fecklessness, drunkenness and gambling, as previously assumed. The poverty studies raised awareness of the extent of poverty in Britain and the myriad social problems it caused.

The Boer war of 1899-1902 highlighted the general poor state of health of the nation. One out of every three volunteers failed the army medical due to malnutrition, other illnesses due to poor diet and very poor living conditions. The military informed the government at the time of the shockingly poor physical condition of many of those conscripted.

It was realised that the effects of poverty were potentially damaging to  the whole of society. Health problems and infectious disease – rife in the overcrowded slums – could affect rich and poor alike. It was recognised that the economy suffered if large numbers of people were too poor to buy goods and social problems such as exploitation, debt, crime, prostitution and drunkenness were a direct result of poverty, and not the cause of it.

The discovery of  widespread poor health as a consequence of poverty raised concerns about Britain’s future ability to compete with new industrial nations such as Germany and the USA. National efficiency would only increase if the health and welfare of the population improved.

The growth of the Labour Party and Trade Unionism presented a threat to the Liberals and the Conservatives. The new working class voters were turning to these organizations to improve their lives. The traditionally laissez-faire Liberals recognised this and supported the idea of government help for the working class.

Back to the present: welfare is no longer about welfare

The current Conservative government has taken a distinctly behaviourist turn – a form of psychopolitics which essentially reduces explanations of poverty to the personal – blaming poor people for poverty and unemployed people for unemployment, formulating policies that are about making people change their behaviour, based on a simplistic “cause and effect” approach. The government nudges and we are expected to comply. Increasing the use of benefit sanctions is one policy consequence of this psychopolitical approach.

Of course this brand of psychopolitics is all about the government assuming the fallibility of the population and the infallibility of the government when it comes to decision-making and behaviours.

Although Cameron claims that “Nudge” draws on a “paternalistic libertarian” philosophy, any government that acts upon a population, by reducing liberties, choices and by imposing behavioural modification without public consent – expecting people to change their behaviours and choices unwittingly to fit with what the state deems “right,” rather than reflecting public needs via democratic engagement and a genuine dialogue, is actually authoritarian.

As I’ve said elsewhere, welfare has been redefined: it is pre-occupied with assumptions about and modification and monitoring of the behaviour and character of recipients, rather than with the alleviation of poverty and ensuring economic and social well-being.

Eugenics by stealth

Further intention of directing behavioural change is at the heart of policies that restrict welfare support such as tax credits to two children. The Conservatives have recently announced plans to cut welfare payments for larger families. Whilst this might not go as far as imposing limits on the birth of children for poor people, it does effectively amount to a two-child policy.

A two-child policy is defined as a government-imposed limit of two children allowed per family or the payment of government subsidies only to the first two children.

Of course this is justified using a Conservative ideologically driven scapegoating narrative of the feckless family, misbehaving and caught up in a self-imposed culture of dependence on welfare.

This restriction in support for children of larger families, however, significantly impacts on the autonomy of families, and their freedom to make decisions about their family life. Benefit rules purposefully aimed at reducing family size rarely come without repercussions.

It’s worth remembering that David Cameron ruled out cuts to tax credits before the election when asked during interviews. Tax credit rates weren’t actually cut in the recent Budget—although they were frozen and so will likely lose some of their value over the next four years because of inflation.

Some elements were scrapped, and of course some entitlements were restricted. But either way a pre-election promise not to cut child tax credits sits very uneasily with what was announced in the budget.

Iain Duncan Smith said last year that limiting child benefit to the first two children in a family is “well worth considering” and “could save a significant amount of money.” The idea was being examined by the Conservatives, despite previously being vetoed by Downing Street because of fears that it could alienate parents. Asked about the idea on the BBC’s Sunday Politics programme, Duncan Smith said:

“I think it’s well worth looking at,” he said. “It’s something if we decide to do it we’ll announce out. But it does save significant money and also it helps behavioural change.”

Firstly, this is a clear indication of the Tories’ underpinning eugenicist designs – exercising control over the reproduction of the poor, albeit by stealth. It also reflects the underpinning belief that poverty somehow arises because of faulty individual choices, rather than faulty political decision-making and ideologically driven socio-economic policies.

Such policies are not only very regressive, they are offensive, undermining human dignity by treating children as a commodity – something that people can be incentivised to do without.

Moreover, a policy aimed at restricting support available for families where parents are either unemployed or in low paid work is effectively a class contingent policy.

The tax child credit policy of restricting support to two children seems to be premised on the assumption that it’s the same “faulty” families claiming benefits year in and year out. However, extensive research indicates that people move in and out of poverty – indicating that the causes of poverty are structural rather than arising because of individual psychological or cognitive deficits.

The Joseph Rowntree Foundation published a study that debunked  the notion of a “culture of worklessness” in 2012.  I’ve argued with others more recently that there are methodological weaknesses underlying the Conservative’s regressive positivist/behaviourist theories, especially a failure to scientifically test the permanence or otherwise of an underclass status, and a failure to distinguish between the impact of “personal inadequacy” and socio-economic misfortune.

Back in the 1970s, following his remarks on the cycle of deprivation, Keith Joseph established a large-scale research programme devoted to testing its validity. One of the main findings of the research was that there is no simple continuity of social problems between generations of the sort required for his thesis. At least half of the children born into disadvantaged homes do not repeat the pattern of disadvantage in the next generation.

Despite the fact that continuity of deprivation across generations is by no means inevitable – the theory is not supported by empirical research – the idea of the cycle of “worklessness” has become “common sense.” Clearly, common perceptions of the causes of poverty are (being) misinformed. The individual behaviourist theory of poverty predicts that the same group of people remain in poverty. This doesn’t happen.

However, the structural theory predicts that different people are in poverty over time (and further, that we need to alter the economic structure to make things better). Longitudinal surveys show that impoverished people are not the same people every year. In other words, people move in and out of poverty: it’s a revolving door, as predicted by structural explanations of poverty.

Many families are in work when they plan their children. Job loss, an accident or illness causing disability, can happen to anyone at any time. It’s hardly fair to stigmatise and penalise larger families for events that are outside of their control.

Limiting financial support to two children may also have consequences regarding the number of abortions. Abortion should never be an outcome of reductive state policy. By limiting choices available to people already in situations of limited choice – either an increase of poverty for existing children or an abortion, then women may feel they have no choice but to opt for the latter. That is not a free choice, because the state is inflicting a punishment by withdrawing support for those choosing to have more than two children, which will have negative repercussions for all family members.

Many households now consist of step-parents, forming reconstituted or blended families. The welfare system recognises this as assessment of household income rather than people’s marital status is used to inform benefit decisions. The imposition of a two child policy has implications for the future of such types of reconstituted family arrangements.

If one or both adults have two children already, how can it be decided which two children would be eligible for child tax credits?  It’s unfair and cruel to punish families and children by withholding support just because those children have been born or because of when they were born.

And how will residency be decided in the event of parental separation or divorce – by financial considerations rather than the best interests of the child? That flies in the face of our legal framework which is founded on the principle of paramountcy of the needs of the child. I have a background in social work, and I know from experience that it’s often the case that children are not better off residing with the wealthier parent, nor do they always wish to.

Restriction on welfare support for children will directly or indirectly restrict women’s autonomy over their reproduction. It allows the wealthiest minority to continue having babies as they wish, whilst aiming to curtail the poor by disincentivisingbreeding” of the “underclass.” It also imposes a particular model of family life on the rest of the population. Ultimately, this will distort the structure and composition of the population, and it openly discriminates against the children of large families.

People who are in favour of eugenics believe that the quality of a race can be improved by reducing the fertility of “undesirable” groups, or by discouraging reproduction and encouraging the birth rate of “desirable” groups.

Eugenics arose from the social Darwinism and laissez-faire economics of the late 19th century, which emphasised competitive individualism, a “survival of the wealthiest” philosophy and sociopolitical rationalisations of inequality.

Eugenics is now considered to be extremely unethical and it was criticised and condemned widely when its role in justification narratives of the Holocaust was revealed.

But that doesn’t mean it has gone away. It’s hardly likely that a government of a so-called first world liberal democracy – and fully signed up member of the European Convention on Human Rights and a signatory also to the United Nations Universal Declaration – will publicly declare their support of eugenics, or their totalitarian tendencies, for that matter, any time soon.

But any government that regards some social groups as “undesirable” and formulates policies to undermine or restrict that group’s reproduction rights is expressing eugenicist values, whether those values are overtly expressed as “eugenics” or not.

Conservatives are not known for valuing diversity, it has to be said.

Implications of the welfare “reforms”: Human rights

Article 25 of the Universal Declaration of Human Rights, of which the UK is a signatory, reads:

  1. Everyone has the right to a standard of living adequate for the health and well-being of himself and of his family, including food, clothing, housing and medical care and necessary social services, and the right to security in the event of unemployment, sickness, disability, widowhood, old age or other lack of livelihood in circumstances beyond his control.
  2.  Motherhood and childhood are entitled to special care and assistance. All children, whether born in or out of wedlock, shall enjoy the same social protection.

A recent assessment report by the four children’s commissioners of the UK called on the government to reconsider its deep welfare cuts, voiced “serious concerns” about children being denied access to justice in the courts, and called on ministers to rethink plans to repeal the Human Rights Act.

The commissioners, representing each of the constituent nations of the UK, conducted their review of the state of children’s policies as part of evidence they will present to the United Nations.

Many of the government’s policy decisions are questioned in the report as being in breach of the convention, which has been ratified by the UK.

England’s children’s commissioner, Anne Longfield, said:

“We are finding and highlighting that much of the country’s laws and policies defaults away from the view of the child. That’s in breach of the treaty. What we found again and again was that the best interest of the child is not taken into account.”

Another worry is the impact of changes to welfare, and ministers’ plan to cut £12bn more from the benefits budget. There are now 4.1m children living in absolute poverty – 500,000 more than there were when David Cameron came to power.

It’s noted in the report that ministers ignored the UK supreme court when it found the “benefit cap” – the £25,000 limit on welfare that disproportionately affects families with children, and particularly those with a larger number of children – to be in breach of Article 3 of the convention – the best interests of the child are paramount:

“In all actions concerning children, whether undertaken by public or private social welfare institutions, courts of law, administrative authorities or legislative bodies, the best interests of the child shall be a primary consideration.”

The United Nation’s Convention on the Rights of the Child (UNCRC) applies to all children and young people aged 17 and under. The convention is separated into 54 articles: most give children social, economic, cultural or civil and political rights, while others set out how governments must publicise or implement the convention.

The UK ratified the Convention on the Rights of the Child (UNCRC) on 16 December 1991. That means the State Party (England, Scotland, Wales and Northern Ireland) now has to make sure that every child benefits from all of the rights in the treaty. The treaty means that every child in the UK has been entitled to over 40 specific rights. These include:

Article 1

For the purposes of the present Convention, a child means every human being below the age of eighteen years unless under the law applicable to the child, majority is attained earlier.

Article 2

1. States Parties shall respect and ensure the rights set forth in the present Convention to each child within their jurisdiction without discrimination of any kind, irrespective of the child’s or his or her parent’s or legal guardian’s race, colour, sex, language, religion, political or other opinion, national, ethnic or social origin, property, disability, birth or other status.

2. States Parties shall take all appropriate measures to ensure that the child is protected against all forms of discrimination or punishment on the basis of the status, activities, expressed opinions, or beliefs of the child’s parents, legal guardians, or family members.

Article 3

1. In all actions concerning children, whether undertaken by public or private social welfare institutions, courts of law, administrative authorities or legislative bodies, the best interests of the child shall be a primary consideration.

2. States Parties undertake to ensure the child such protection and care as is necessary for his or her well-being, taking into account the rights and duties of his or her parents, legal guardians, or other individuals legally responsible for him or her, and, to this end, shall take all appropriate legislative and administrative measures.

3. States Parties shall ensure that the institutions, services and facilities responsible for the care or protection of children shall conform with the standards established by competent authorities, particularly in the areas of safety, health, in the number and suitability of their staff, as well as competent supervision.

Article 4

States Parties shall undertake all appropriate legislative, administrative, and other measures for the implementation of the rights recognized in the present Convention. With regard to economic, social and cultural rights, States Parties shall undertake such measures to the maximum extent of their available resources and, where needed, within the framework of international co-operation.

Article 5

States Parties shall respect the responsibilities, rights and duties of parents or, where applicable, the members of the extended family or community as provided for by local custom, legal guardians or other persons legally responsible for the child, to provide, in a manner consistent with the evolving capacities of the child, appropriate direction and guidance in the exercise by the child of the rights recognized in the present Convention.

Article 6

1. States Parties recognize that every child has the inherent right to life.

2. States Parties shall ensure to the maximum extent possible the survival and development of the child.

Article 26

1. States Parties shall recognize for every child the right to benefit from social security, including social insurance, and shall take the necessary measures to achieve the full realization of this right in accordance with their national law.

2. The benefits should, where appropriate, be granted, taking into account the resources and the circumstances of the child and persons having responsibility for the maintenance of the child, as well as any other consideration relevant to an application for benefits made by or on behalf of the child.

Here are the rest of the Convention Articles

The Nordic social democratic model of welfare

Finally, it’s worth noting, as sociologist Lane Kenworthy has pointed out, that the Nordic welfare experience of the modern social democratic model can:

“promote economic security, expand opportunity, and ensure rising living standards for all . . . while facilitating freedom, flexibility and market dynamism.”

Nordic welfare models include support for a universalist welfare state which is aimed specifically at enhancing individual autonomy, promoting social mobility and ensuring the universal provision of basic human rights, as well as for stabilizing the economy, alongside a commitment to free trade.

The Nordic model is distinguished from other types of welfare states by its emphasis on maximizing labor force participation, promoting gender equality, egalitarian and extensive benefit levels and the large magnitude of income redistribution.

Nobel Prize-winning economist Joseph Stiglitz has noted that there is higher social mobility in the Scandinavian countries than in the United States, and argues that Scandinavia is now the land of opportunity that the United States once was. The Nordics cluster at the top of league tables of everything from economic competitiveness to social health to happiness.

They have avoided both southern Europe’s economic sclerosis and America’s extreme inequality. Development theorists have taken to calling successful modernisation “getting to Denmark”.

The Nordics demonstrate very well that it is possible to combine competitive capitalism with a large state: they employ 30% of their workforce in the public sector, compared with an OECD average of 15%. The main lesson to learn from the Nordics is not ideological but practical.

The state is popular not because it is big but because it works. A Norwegian pays tax more willingly than a Californian because he or she has access to decent schools, support when times are difficult and free health care as a result.

Norway ranks among the richest countries in the world. GDP per capita is among the highest in the world.

Norway regards welfare services not as social costs but as fundamental social investment for open innovation and growth.

Innovation should not be an opportunity for a few only. It should be democratised and distributed in order to tackle the causes of growing inequality.

Inequality hampers economic growth.

We can’t afford not to have a welfare state.

See also:

Children’s Commissioner warns that UK is now in breach of the UN Convention on the Rights of the Child

Human rights are the bedrock of democracy, which the Tories have imperiled.

Welfare reforms break UN convention

Welfare reforms, food banks, malnutrition and the return of Victorian diseases are not coincidental, Mr Cameron

The government refuse to carry out a cumulative impact assessment of welfare “reforms”. Again.

Suicides reach a ten year high and are linked with welfare “reforms”

The poverty of responsibility and the politics of blame. Part 3 – the Tories want to repeal the 2010 Child Poverty Act

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Pictures courtesy of Robert Livingstone

Benefit cuts “will involve cuts to benefits” shocker

imagesBy Private Eye Political Correspondent Noah Surprise.

There was widespread shock across Britain today that the £12 billion of welfare cuts promised in the Tory election manifesto would turn out to be £12 billion of cuts to the welfare budget.

“We definitely didn’t think these 12 billion worth of cuts would involve people like us,” said one first-time Tory voter, having her child tax credits halved.

“We thought it would only affect those wretched people on those awful benefit shows on Channel 4.” https://upload.wikimedia.org/wikipedia/en/b/bb/Benefits_Street.jpg “We feel utterly betrayed by the Tories,” said another father, who is having his family working tax credits slashed.

“Why didn’t Osborne say these 12 billion worth of cuts would affect me? I naturally assumed it would hit people in the North, guests on the Jeremy Kyle show and muslims. That’s why I voted Tory.”

George Osborne has insisted he’d worked hard to ensure that the cuts to benefits were spread evenly between those people most likely to vote Labour and those most likely to vote Lib Dem.

539627_450600381676162_486601053_n (2)Courtesy of Robert Livingstone

See also:

Budget 2015: cuts to make Daily Mail readers wince, but not just yet

The budget: from trickle-down to falling down, whilst holding hands with Herbert Spencer

And finally, a timely reminder of Martin Niemöller’s words on the ultimately self-destructive complicity of bystander apathy, because despots never simply attack and persecute the group of your choosing:

The budget: from trickle-down to falling down, whilst holding hands with Herbert Spencer.

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“We are moving Britain from a high welfare, high tax economy, to a lower welfare, lower tax society.”

George Osborne, 8 July 2015

The pro-wealthy and anti-humanist budget indicates clearly that the Conservatives are preoccupied with highlighting and cutting the state cost of sustaining the poorest citizens rather than the costs of subsidising the rich.

I’ve pointed out before that the Conservatives operate a perverse, dual logic: that wealthy people need support and encouragement – they are offered substantial financial incentives – in order to work and contribute to the economy, whereas poor people apparently need to be punished – by the imposition of financial cuts – in order to work and contribute to the economy.

That Osborne thinks it is acceptable to cut the lifeline benefits of sick and disabled people to pay for government failures, whilst offering significant cuts to corporation tax rates; raising the tax-free personal allowance and extending inheritance tax relief demonstrates very clearly that the myth of trickle-down is still driving New Right Conservative ideology, and that policy is not based on material socio-economic conditions and public need. (And Cameron is not a one-nation Tory, despite his claims.)

Research by the Tax Justice Network in 2012 indicates that wealth of the very wealthy does not trickle down to improve the economy, but tends to be amassed and sheltered in tax havens with a detrimental effect on the tax bases of the home economy.

A more recent report – Causes and Consequences of Income Inequality : A Global Perspective by the International Monetary Fund concluded in June this year that there is no trickle-down effect –  the rich simply get richer:

“We find that increasing the income share of the poor and the middle class actually increases growth while a rising income share of the top 20 percent results in lower growth—that is, when the rich get richer, benefits do not trickle down.”

It’s inconceivable that the Conservatives fail to recognise such policy measures will widen inequality. Conservatives regard inequality and social hierarchy as inevitable, necessary and functional to the economy. Furthermore, Conservatives hail greed and envy as emotions to be celebrated, since these drive competition.

Since the emergence of the New Right, from Thatcher to Cameron, we have witnessed an increasing entrenchment of Neoliberal principles, coupled with an aggressive, authoritarian brand of social conservatism that has an underpinning of crude, blunt social Darwinist philosophy, as carved out two centuries ago by the likes of Thomas Malthus and Herbert Spencer.

Spencer is best known for the expression “survival of the fittest,” which he coined in Principles of Biology (1864), after reading Charles Darwin’s work. Spencer extended natural selection into realms of sociology, political theory and ethics, ultimately contributing to the eugenics movement. He believed that struggle for survival spurred self-improvement which could be inherited. Maslow would disagree. All a struggle for survival motivates is just a struggle for survival.

Spencer’s ideas of laissez-faire; a survival-of-the-fittest brand of competitive individualism; minarchism – minimal state interference in the processes of natural law – and liking for private charity, are echoed loudly in the theories of 20th century thinkers such as Friedrich HayekMilton Friedman and Ayn Rand who each popularised Spencer’s ideas, whilst Neoliberal New Right Conservatives such as Ronald Reagan, Margaret Thatcher and David Cameron have translated these ideas into policies.

Ideology has considerable bearing on policies, and policies may be regarded as overt, objective statements of political intent. I’ve said many times over the past five years that Conservatives have forgotten that democracy is based on a process of dialogue between the public and government, ensuring that the public are represented: that governments are responsive, shaping policies that address identified social needs. Conservative policies are quite clearly no longer about reflecting citizen’s needs: they are increasingly authoritarian, and all about telling us how to be.

Conservatives have always coldly conceived society as a hierarchy of human value, and they have, from their pinnacle of supremacist, self-appointed authority, historically cast the vulnerable and the poorest as the putative “enemies of civilization.” Social Darwinism is written in bold throughout their policies.

Furthermore, such a combination of Neoliberal and Conservative political theory, explicitly opposes democratic goals and principles. Neoliberalism was originally used by academics on the Left as a pejorative to capture the policies of imposed exploitation, privatisation, and inequality.

Neoliberalism is now characterised by the use of international loans and other mechanisms to suppress unions, squash state regulation, elevate corporate privilege, privatise public services, and protect the holdings of the wealthy. The term became widely recognised shorthand for rule by the rich, authoritarianism and the imposition of limits on democracy.

Banks, corporations, the financial sector, and the very wealthy are exercising power and blocking any attempt to restructure the economic system that brought about the crash.

Meanwhile, the free market is a market free for powerful interests; the profit motive has transformed the organising value of social life, and those who the Conservatives evidently regard as collateral damage of this socio-economic dogma made manifest are paying the price for the global crash, with Osborne and the Conservatives constructing narratives that problematise welfare support, generating moral panic and folk devils to demonise the poorest citizens in need of support.

Growing social inequality generates a political necessity for cultivating social prejudices.

Such Othering narratives divert public attention from the fact that the right to a fair and just legal system, a protective and effective safety net for the poorest, free healthcare – all of the social gains of our post-war settlement – are all under attack.

I have said elsewhere that Conservative ideology is incompatible with our legal commitments to human rights. The United Nations declaration of Human Rights is founded on the central tenet that each and every human life has equal worth. The Conservatives don’t agree, preferring to organise society into hierarchies of worth and privilege.

Conservative austerity measures and further impending welfare cuts are not only a deliberate attack on the poorest and most vulnerable social groups; the range of welfare cuts do not conform to a human rights standard; the “reforms” represent a serious failure on the part of the government to comply with Britain’s legal international human rights obligations.

The cuts announced by the chancellor include a further reduction to the benefits cap – not only from £26,000 to £23,000, as promised in the Conservative Party’s 2015 manifesto, but down even further to £20,000 outside of London.

Child tax credit, housing benefit and working tax credit will be reduced, with child tax credit only being paid for the first two children. Presumably this is, to quote Iain Duncan Smith, to “incentivise behavioural change,” placing pressure on the poorest to “breed less,” though personally, being the direct, blunt, no-nonsense sort, I prefer to call it a nudge towards “eugenics by stealth.”

The Social Mobility and Child Poverty Commission say that any cuts to tax credits will cut the incomes of 45 per cent of working families. These cuts are particularly controversial, since the benefits cap was partly justified as a way of “making work pay”  – a Conservative narrative that echoes the punitive 1834 New Poor Law Principle of less eligibility – see: The New New Poor Law.

The Government asserts that its welfare “reform” strategy is aimed at breaking the cycle of “worklessness” and dependency on the welfare system amongst the poorest families. It’s more punitive Poor Law rhetoric.

There’s no such thing as “worklessness”, it’s simply a blame apportioning word, made up by the Tories to hide the fact that they have destroyed the employment market, just as Thatcher did, and as the Conservatives always do.

Punishing the low paid, cutting the income of families who work for low wages directly contradicts the claim that the Conservatives are “making work pay.”

Yet Osborne has framed his welfare cuts with the “The best route out of poverty is work” mantra, claiming that slashing the social security budget by £46 billion in the next five years, (including cutting those benefits to disabled people, who have been assessed as unfit for work and placed in the Work Related Activity Group (WRAG), and cutting in-work benefits, such as tax credits) is needed to make sure “work pays” and that: “we give a fair deal for those on welfare and a fair deal to the people, the taxpayers of this country who pay for it.”

The Conservatives always conveniently divide people into an ingroup of taxpayers and an outgroup of stigmatised others – non-tax payers. However, most people claiming benefits are either in work, and are not paid enough, through no fault of their own, to pay tax, or are pensioners who have worked most of their lives; or are unemployed, but have previously worked and contributed tax.

Most people claiming disability benefits have also worked and contributed tax, too.

Unemployment and in-work benefit claims are generally a measure of how well or poorly the government is handling the economy, not of how “lazy” or “incentivised” people are.

And only the Tories have the cheek to claim that raising the minimum wage (long overdue, especially given the hikes in the cost of living) is the introduction of a living wage. The basic idea is that these are the minimum pay rates needed so that workers have an acceptable standard of living. Over the last few years, wages have very quickly fallen far behind the ever-rising cost of living.

The increase is at a rate of £7.20 an hour for people over the age of 25.  Housing benefit will be withdrawn from those aged between 18 and 21, while tax credits and universal credits will be targeted at people on lower wages by reducing the level at which they are withdrawn.

The chancellor’s announcement amounted merely to an increase in the minimum wage, and the curbs on tax credits would hit low-paid workers in other ways, unfortunately.

Whilst the announcement of a phased increase in the minimum wage is welcome, it is difficult to see how this will reverse the increasing inequality that will be extended as a further consequence of this budget without a matching commitment to improving the structural framework – the quality and stability of employment available. As it is, we are now the most unequal country in EU.

If the government were sincerely interested in raising wages to make work genuinely pay, ministers would be encouraging rather than stifling trade unionism and collective bargaining. But instead we see further cuts to public sector pay in real terms year after year and the raising of the legal bar for industrial action so that strikes will be effectively outlawed in public services. And let’s not forget the grubby partisan policy of two years ago – the Let Lynton Lobby Gagging Act.

Rhys Moore, director of the Living Wage Foundation, said:

“Is this really a living wage? The living wage is calculated according to the cost of living whereas the Low Pay Commission calculates a rate according to what the market can bear. Without a change of remit for the Low Pay Commission this is effectively a higher national minimum wage and not a living wage.”

Those most affected by the extreme welfare cuts are those groups for which human rights law provides special protections. The UK government has already contravened the human rights of women, children, and disabled people.

The recent report of the UK Children’s Commissioner to the UN Committee on the Rights of the Child, published in July this year, says:

“Response to the global economic downturn, including the imposition of austerity measures and changes to the welfare system, has resulted in a failure to protect the most disadvantaged children and those in especially vulnerable groups from child poverty, preventing the realisation of their rights under Articles 26 and 27 [of the UN CRC] … Reductions to household income for poorer children as a result of tax, transfer and social security benefit changes have led to food and fuel poverty, and the sharply increased use of crisis food bank provision by families.”

The parliamentary Joint Committee on Human Rights recently reported on the UK’s compliance with the United Nations Convention on the Rights of the Child (CRC), and found it woefully lacking:

“Welfare cuts will ensure that the government is not in compliance with its international human rights obligations to realise a right to an adequate standard of living under Article 11 of the International Covenant on Economic and Social Rights (ICESR) and a child’s right to an adequate standard of living under Article 27 of the UN CRC. Further it will be in breach of the statutory target to eliminate child poverty contained in the Child Poverty Act 2010.”

Just in case you missed it, there has been a very recent, suspiciously timed change to the definition of child poverty, and a proposed repeal of the Child Poverty Act – something that Iain Duncan Smith has been threatening to bring about since 2013.

It’s yet another ideologically directed Tory budget, dressed-up in the rhetoric of economic necessity, detached from public needs.

And Conservative ideology is all about handouts to the wealthy that are funded by the poor.

Related:

George Osborne’s Political MasterstrokeA View from the Attic

Osborne’s class spite wrapped in spin will feed a backlashSeumas Milne

Budget 2015: what welfare changes did George Osborne announce, and what do they mean?  New Statesman: The Staggers

How Osborne’s new cuts breach the UK’s human rights obligations, Lecturer in Law at Lancaster University

Osborne’s Autumn statement reflects the Tory ambition to reduce State provision to rubble

Osborne’s razor: the Tory principle of parsimony is applied only to the poorest

The BBC expose a chasm between what the Coalition plan to do and what they want to disclose

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Thanks to Robert Livingstone