Iain Duncan Smith’s new plan to prolong child poverty

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Iain Duncan Smith wants to talk about child poverty – but how can we take him seriously when he starts the discussion with a lie?

“Recent analysis reveals that children are three times as likely to be in poverty in a workless family and there are now fewer children living in workless households than at any time since records began, having fallen by 274,000 since 2010,” according to the Department for Work and Pensions’ press release on the new consultation.

Oh really?

According to the Joseph Rowntree Foundation (JRF), child poverty will rise from 2.5 million to 3.2 million during the 2010-2015 Parliament – around 24 per cent of all the children in the UK. By 2020, if the rise is not stopped, it will increase to four million – around 30 per centof all children in the UK.

Under the Coalition government, the number of people in working families who are living in poverty – at 6.7 million – has exceeded the number in workless and retired families who are in poverty – 6.3 million – for the first time.

The Joseph Rowntree Foundation has measured poverty, using several indicators, for more than 15 years; its figures are far more likely to be accurate than those of the government, which is still defining poverty as an income of less than 60 per cent of median (average) earnings. Average earnings are falling, so fewer people are defined as being in poverty – but that doesn’t make the money in their pockets go any further.

“The previous government’s target to halve child poverty by 2010 was not achieved,” states the DWP press release. Then it comes out with more nonsense: “The government is committed to ending child poverty in the UK by 2020 and the draft child poverty strategy sets out the government’s commitment to tackle poverty at its source.” From the JRF figures alone, we know that government policy is worsening the situation – or has everyone forgotten that 80,000 children woke up homeless last Christmas morning?

Let’s look at the government’s plans.

The DWP claims “reforming the welfare system through Universal Credit… will lift up to 300,000 children out of poverty, and cover 70 per cent of childcare costs for every hour worked”. But we know that Universal Credit is effectively a benefit cut for everyone put onto it; they won’t get as much as they do on the current benefits, and the one per cent uprating limit means falling further into poverty every year. Also, we found out this week that the housing element will be subject to sanctions if people in part-time jobs cannot persuade their employers to give them more hours of work. The claim is ridiculous.

The DWP claims the government will will increase investment in the Pupil Premium, provide free school meals for all infant school children from September this year, improve teacher quality, fund 15 hours of free early education places per week for all three- and four-year-old children and extend 15 hours of free education and care per week to two-year-olds from low income families. None of these measures will do anything to “tackle poverty at its source”. Tackling poverty at its source means ending the causes of poverty, not putting crude metaphorical sticking-plasters over the effects – which could be removed at any time in the future.

The DWP claims the government will cut tax for 25 million people by increasing the personal tax allowance, and cut income tax for those on the minimum wage by almost two-thirds. This means people will have more money in their pocket – but will it be enough, when benefit cuts and sanctions are taken into account? Will their pay increase with the rate of inflation? There is no guarantee that it will. And this move means the government will collect less tax, limiting its ability to provide services such as poverty-reduction measures.

The DWP claims the government will reduce water and fuel costs, and attack housing costs by building more homes. The first two measures may be seen as responses to aggressive policy-making by the Labour Party, and the last will only improve matters if the new dwellings are provided as social housing. Much of the extra spending commitment is made for 2015 onwards, when the Conservative-led Coalition may not even be in office.

These are plans to prolong poverty, not end it.

It is notable that the DWP press release repeats many of the proposals in an attempt to pretend it is doing more. Take a look at the list and count for yourself the number of times it mentions fuel/energy bills (three times) and free school meals (twice).

In fact, the only measures that are likely to help reduce the causes of poverty are far down the list: Increasing access to affordable credit by expanding credit unions and cracking down on payday lending (at the very bottom – and we’ll have to see whether this really happens because payday lenders are generous donors to the Conservative party); and reviewing – mark that word, ‘reviewing’ – the national minimum wage, meaning that the government might increase the minimum wage in accordance with Low Pay Commission recommendations.

The DWP press release quotes Iain Duncan Smith, who said the consultation re-states the government’s commitment to tackle poverty at its source, “be it worklessness, family breakdown, educational failure, addiction or debt”.

The measures he has proposed will not improve anybody’s chance of finding a job, nor will they prevent family breakdown, or addiction. The plans for education have yet to be tested and may not work. The plan for debt involves annoying Conservative Party donors.

The JRF has responded to the consultation diplomatically, but there can be no mistaking the impatience behind the words of Chris Goulden, head of poverty research. He said: “Given that it has been over a year since the initial consultation on child poverty measures, we are disappointed that the government is now going to take even longer to agree what those indicators will be.

“With one in four families expected to be in poverty by 2020, a renewed strategy to address child poverty is vital. Any effective strategy should be based on evidence and contain measures to reduce the cost of living and improve family incomes. However, until those measures are agreed, it is difficult to see how the government can move forward.”

Don’t be too concerned about moving forward, Chris.

This government is backsliding.

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The benefit debate is a diversion – that’s why it will go on and on

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allowance, banker, benefits street, blame, boss, build, Channel 4, Conservative, crisis, David Cameron, debate, dodge, economic, economy, Eton, flood, house, housing benefit, industrial, industry, job, jobless, jobseeker, low, Owen Jones, pay, private landlord, relief, rent, rip-off, strategy, subsidise, system, tax, tax haven, Tories, Tory, workless

How many of you tuned into the last episode of Benefits Street on Channel 4, and stayed on for the debate that followed?

Quite a few, I reckon.

They were worth watching, but the feeling that was left with this viewer (and I’ve been reviewing television for 20 years or more) is that we are talking ourselves around in circles – led by politicians with a vested interest in perpetuating the discussion.

They don’t want a solution. They want us to keep going over the same ground – which they have laid out for us with very specific limits – and they want to concentrate our anger about this issue so that we blame, not the people responsible – the tax dodgers who put money into tax havens that could be invested in British industry, the private landlords and low-paying bosses who are subsidised by the benefit system and the bankers who caused the economic crisis a few years ago – but the people who have been forced onto benefits through no fault of their own and are being persecuted for it by a punitive system that penalises them for failing to find jobs that really do not exist.

Look at the way David Cameron leapt forward with fistfuls of cash to pay for flood relief when Tory heartlands were affected, saying that money was no object and Britain is a rich country. We’re rich enough to look after the playing fields of Eton, but not our poorest citizens, according to his mentality. Property is worth more to him than people.

Why? Because the people who send their children to Eton are the people Cameron hopes will elect him (he can’t be re-elected; he didn’t win the 2010 election) in 2015. The unemployed are less likely to vote for him – in fact they are less likely to vote at all. It seems there is something about being rejected by society that instils a sense of listlessness and despair in the human psyche. People ask themselves: Why bother?

There are solutions, but it is cause for concern that we are not hearing about them from our MPs and politicians. Journalist Owen Jones came out with the clearest plan during the debate on Channel 4 last night, and it is well worth quoting in full.

He said: “Firstly let’s make it clear – work does not pay in this country. We hear that as a mantra, when most people in poverty get up in the morning and earn that poverty.

“We’re talking about people milking the system. Let’s talk about the low-paying bosses who are being subsidised with in-work benefits because, in the seventh-richest country on Earth, they won’t pay.

“If we’re talking about getting people into jobs I actually think we need to talk about solutions here. One in six workers in the last two years have claimed Jobseekers’ Allowance at some point; that’s a lack of security.

“What we need firstly is a massive house-building programme that would reduce the amount spent on Housing Benefit which, by the way, is not going into the pockets of these tenants – it’s lining the pockets of private landlords charging rip-off rents. If we build housing, it would create jobs and we would stimulate the economy as well.

“It goes the same with the need for an industrial strategy because what successive governments have done, and it started in the eighties, is let the secure jobs go to rot, if you like. Now, other countries like Germany, what they’ve done is had an industrial strategy. Instead of saying, ‘Hands off, let the market decide,’ they’ve said, ‘Actually we want to create jobs in renewable energy.’ Now we’ve just seen the floods; we’re going to have a lot more extreme weather, so let’s have an industrial strategy to go and create renewable energy jobs, giving people secure, dignified jobs, taking on the environmental crisis.

“These are solutions… We’ve got to change the debate we have at the moment where the real villains of the piece, like the tax dodgers who get away with not paying £25 billion a year in tax, like the private landlords and the low-paying bosses milking our welfare state, like the bankers who caused the economic disaster – they get away with it, but all we ever hear about is kicking people at the bottom.”

Absolutely right. And that’s all we’ll hear about it for the foreseeable future, as well. We won’t hear about returning to a full-employment society (which is perfectly possible), because that means the greedy rich will have less money for themselves in the short term.

In the long term, ensuring that there are properly-paid jobs for the most people, so they do not have to claim benefits, means that there is more money moving around the economy – and money makes money. The parasites – who are making a fortune unsustainably by working people hard and paying them poverty rations – would be just as rich in the long run, but they cannot bear to consider the possibility.

One has to consider whether they want to force people into poverty, just to make their own wealth seem more remarkable – the poverty trap as ego-trip, if you like.

But we won’t hear about that because it is politically inflammatory. Far better to set the lower classes against each other, laying blame on each other for problems that are caused by different people entirely – and laugh all the way to the offshore bank.

If I had to describe Britain to a foreigner, I would ask them to imagine a person being robbed outside a public lavatory, by the mayor of his town, while council workers started demolishing the building; the rich are destroying our public services and mugging us at the same time.

Very soon, the same people who are mugging you will be asking for your vote…

… while blaming you for problems they have done nothing to solve.

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Cameron’s determination to ruin us all continues unabated – BBC

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David Cameron must think we’re all as stupid as his fellow Conservatives and that party’s most rabid adherents, if the latest BBC report is to be believed.

In it, he responds to comments from his Coalition government’s own Business Secretary, Vince Cable, suggesting the government could consider borrowing more – at, let’s remember, the lowest interest rates in British history – to inject some growth into the economy.

Cable’s remarks are eminently sensible – which is, of course, why Cameron is believed to be moving so quickly to counter them. The fact is that austerity never – ever – brought a country out of debt. Investment is the key. Investment needs money. If you don’t have money, you borrow it from someone who does. Then you pay them back – with interest from your profits. ‘Speculate to accumulate’, as the saying goes. It’s how most Conservatives and Tory voters made their money but Cameron – and his sidekick 0sborne, let’s not forget – inherited theirs and therefore, we may reasonably deduce, know nothing whatsoever about it.

Instead, Cameron will reiterate his insistence on following the ‘Starve the Beast’ policy that George W Bush used to such devastating effect when he was President of the USA, reducing a surplus of $128 billion to a deficit of $10.627 trillion within a few short years.

A decent definition of ‘Starve the Beast’ economic theory is that it is a fiscal strategy to create or increase existing budget deficits via tax cuts to force future reductions in the size of government.

This is clearly what Cameron and his cronies are doing – and the Liberal Democrats are helping them all the way, no matter what Cable says about it. It’s why they’ve borrowed more money in the last two and a half years than the Labour Party did in three terms of office (as a recent meme puts it).

And they will cut the machinery of this country’s government down to the marrow, for no better reason than their own personal enrichment and the fact that it will create huge problems for any government that follows them in 2015.

The BBC report contains excerpts of what Cameron was expected to say in a speech today (Thursday). These deserve interpretation, as their meaning is not entirely clear at first glance:

“I know some people think it is being stubborn to stick to a plan. That somehow this is just about making the numbers add up.” He’s setting us all up with a false premise. We don’t think he’s being stubborn; we know his real plan isn’t what he has been trying to sell us. It’s about cutting the state to nothing, impoverishing the vast majority of us in the process and enriching his cronies. This is why, crucially, the numbers don’t add up at all.

“The very moment when we’re just getting some signs that we can turn our economy round and make our country a success is the very moment to hold firm to the path we have set.” So the present moment, with the loss of our ‘AAA’ credit rating, high street shop chains dropping like flies and his own political party regularly being dropped to third place in by-elections, would definitely not be that time.

“And yes, the path ahead is tough – but be in no doubt, the decisions we make now will set the course of our economic future for years to come.” This is absolutely true. The decisions he makes now will set the course of our economic future for years to come. What a shame nobody seems able, or willing in the case of the Liberal Democrats, to stop him.

“And while some would falter and plunge us back into the abyss, we will stick to the course.” He is projecting the effects of his own actions onto his political opponents. He knows perfectly well that it is his course that will lead us straight to that metaphorical abyss – if he hasn’t pitched us over into it already.

The BBC article goes on to say that he will point to the creation of a million extra private sector jobs – a claim that has been debunked many, many times since he first made it. Private sector jobs have been created, but nowhere near a million of them! Also the terms under which people are being employed are appalling.

It is typical of the kind of ridiculous babble to which he and his lieutenants have subjected us for nearly three years now – a period in which our situation has never – not once – offered even the appearance of improvement.

This blog reported only a few days ago that Cameron had been put on notice by his own party – improve or lose the leadership.

The sooner those backbenchers follow through on this threat, the better.

For all of us.

Don’t expect any U-turns from our blinkered Chancellor

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2010 election, austerity, beast, Boris, budget, Bush, Coalition, Conservative, deficit, economists, fiscal, George, George W, government, growth, infrastructure, Johnson, Labour, London, Mike Sivier, mikesivier, national, Osborne, Party, projects, public, pussyfooting, reduction, savings, Scotland, services, starve, strategy, tax, the, Wales

It’s no good pulling a face, George; we can all see exactly what you’re doing – and it’s neither big nor clever!

There’s absolutely no possibility that George Osborne will give in to the latest calls for him to ditch his ‘deficit reduction strategy’ and adopt a more moderate plan.

Firstly, people need to understand that the Coalition government’s fiscal strategy isn’t about reducing the national deficit at all. If it was, we would not have had a big tax break for the richest in society as part of the last budget. It’s a strategy to axe public services, selling off to rich corporations any that might be capable of yielding a profit. George W Bush followed this policy in the United States a few years ago; it’s called ‘starving the beast’ – look it up on Wikipedia.

Secondly, a more moderate plan, mixing appropriate savings in government costs with growth-creating measures, is something Mr Osborne could never palate for one reason: It’s the policy put forward by the Labour Party before the 2010 election. Adopting it would mean that he was admitting Labour were right; the Conservatives were entirely wrong to put forward their ideologically-driven austerity plan as an alternative; and that he had wasted everybody’s time and tax money for the past two and a half years.

At least we get the joy of watching all his support flow away, drip by drip. The current story shows nine of the 20 economists who signed a letter supporting austerity back in February 2010 (just before the general election) have had a change of heart. Others have already done so.

Furthermore, Boris Johnson merrily stabbed the part-time Chancellor in the back, at the same time as the economists. He called for David Cameron to “stop pussyfooting around” and invest in major infrastructure projects in London.

His outburst was an outstanding achievement as he managed to shoot himself in both feet at the same time – putting himself at odds with the Conservative leadership and showing the country as a whole how out of touch he really is.

London has just received £9.3 billion worth of investment for the Olympic games, along with related infrastructure investments worth a further (reputed) £16 billion. Other parts of the UK are desperate for investment on a fraction of that scale!

For example, the people of Scotland might reconsider whether secession from the United Kingdom was a good idea, if the UK government invested a little cash in their country; as might the people of Wales.

Oh! But then, Scotland and Wales don’t vote Conservative, do they?