Social Security: Winter is coming and the Government appears content to leave the ramparts unguarded

A homeless encampment in Manchester last year, one of the signs of the growing strain on Britain's social security safety net. People are falling through the system into poverty.

The first signs are appearing of the hard times ahead, forecast by the Autumn Statement. It has been less than a week since the Government announced its budget priorities and already it is under pressure over the gaps in social security created by the lower funding brought by six years of austerity.

People are falling through the cracks because, from social care to free school meals, the safety net is becoming porous. In some areas, people don't know they have a right to support and in others there simply aren't places for them in programmes.

At the root of these issues is funding. In their quixotic crusade to tackle public spending, that they sees as an unnecessary waste, the Conservatives have chipped, slashed and removed whole sections of Britain's social security safety net.

As Labour Leader Jeremy Corbyn has pointed out, the Conservatives have slashed spending even where spending would ultimately save far more money in the long run than cuts will. The onward rumbling housing crisis has proven particularly expensive for the Government.

As a result of a failure to build new social housing, and the determined sell-off of present stock, far more is spent on Housing Benefit to keep people in more expensive, and often less satisfactory, private rented accommodation.

Investing funds in social housing could, in fact, drastically reduce the housing benefit bill, by perhaps billions, all while tackling one of Britain's a major infrastructural problem. The key that the Conservative seem to be missing is the vital role to be played by smart spending.

The Conservatives have certainly tried to portray themselves as embracing the idea of smart spending. When it comes to funds, the Government has been keen to say that it has extended certain tax raising powers to local government to cover the increased cost of social care. And the Prime Minister continues to repeat the '£10bn for the NHS' figure.

Yet their claims are belied by reality. The £10bn figure has been debunked and its continued use criticised. The extra funding for social care, the Social Care Precept - that lets local government keep a 2% greater share council tax receipts - has been dismissed as wholly inadequate. The Chancellor pledge in invest in infrastructure resulted in just 40,000 new homes being promised.

There is even talk today of the pension age being pushed back again. Even as the living standards of all workers, especially the most vulnerable, continue to fall, the Government still whittles away at the public sector and turns to the market.

Winter is coming and the Government appears content to leave the ramparts unguarded - believing perhaps that people should secure their own fences in a market for social security. That is a plan that progressives should comprehensively reject.

Prioritising opportunities for the affluent and thrusting over security for the vulnerable isn't just unethical and economically unsound, its also a social disaster waiting to happen.

It is the very thing that feeds the desperation, that in turn feeds the far right. The neoliberalism of the Centre-Right is laying the shaky foundations of its own collapse.

So what does that leave for progressives to do? Yanis Varoufakis has put it the simplest: first, stabilise and save what we can of value in the present system, and second, develop a real, working and unifying alternative. The costs of letting the house of cards fall - personally, socially, economically - are just far too high to do otherwise.

Autumn Statement: Austerity hasn't worked, yet Chancellor's response is much smaller than Britain's big problems demand

House building pledge typifies problems with Chancellor Philip Hammond's Autumn Statement - it's too little action to tackle a much bigger problem. Photograph: Regency Houses from Pixabay (License) (Cropped)

John McDonnell, the Labour Shadow Chancellor, described the Autumn Statement as a budget that does not make up for six wasted years. That after all of the sacrifice, over more than half a decade, despite continuous failures, austerity will continue.

That is not an unfair assessment. For this statement, Chancellor Philip Hammond had to juggle the policy inheritance from George Osborne, meeting the promise of Theresa May to help those just getting by, and the economic pressures that are depressing growth, disincentivising investment and pushing up debt.

The result has been a budget statement that sticks close to the status quo, with only some token, already scheduled, easing measures: the personal allowance advancing to £11,500, the 'national' living wage to £7.50, and the welfare withdrawal taper rate down by just two pence in the pound.

The Chancellor's focus remains upon the broader economy, not least with tax cuts continuing for big business as Corporation Tax falls again to 17%. The promise that these subsidies, and policies like the productivity fund, make to people is that if they help the economy, that prosperity will extend to them.

Yet many of the Chancellor's announcements were effectively cancelled out by the facts. He lauded the fact that the UK has its highest employment and lowest unemployment, with a labour market recovery serving everyone. Yet much of the new work has already been reported as being unstable, insecure and precarious.

Despite confirming plans to increase public investment, that comes on the back of years of delayed, stalled or unfunded infrastructure investment plans that have been shifted from announcement to announcement. Meanwhile economic growth is depressed, private investment remains low and debt is still rising.

And on house building, a necessary step to tackling the damaging housing crisis, Hammond has said he will lead a step change in progress on getting them built. Yet his commitment extended to just 40,000 new homes - a long way short of the hundreds of thousands needed, let alone tackle prices and rents escalating beyond what could be credibly referred to as affordable.

While Conservative spokespeople on the cycling news coverage are keen to deflect their failures onto the uncertain circumstances of the times, the reality is that six years of fiscally conservative government has led to a rise in borrowing and a vast increase, even a doubling, of the national debt. Austerity hasn't worked.

Those 'just about managing', as the Tory government labels them, have made huge sacrifices - with less welfare support, with their frontline services embattled, with work that is more precarious for lower pay. But after six years, there is still no pay off. There is no easing. There is still no succour for falling living standards.

If the Government is serious about helping the poorest, the most vulnerable, those most distant from opportunities and living precarious lives, it needs an alternative plan. Fiscal discipline, bringing down debts to reduce the cost of servicing them, is important. But no major economy is working well enough to provide prosperity for the people they're supposed to serve without help from public funds.

Progressives have to construct an alternative plan, that can return more prosperity to the communities that have made big sacrifices to achieve it, but have been alienated from the rewards by austerity. That means getting on with the work that has been put off, like building homes and infrastructure, tackling the cartels that lock communities out of the product of their own resources, with ideas like community energy co-ops, and doing more to support the most vulnerable with healthcare, social care and welfare.

Autumn Statement Preview: Hammond looks likely to ease austerity, but progressives have to believe we can do more

What awaits Britain under a new Chancellor? Photograph: Pound Coins from Pixabay (License) (Cropped)

On Wednesday, Chancellor Philip Hammond will present the Autumn Statement, the half-year update on the Government's progress towards their budget targets.

Under previous Chancellors Gordon Brown and George Osborne, the Autumn Statement became virtually a second budget, a second for the Government to manage and tweak the country's finances. Osborne in particular liked to tinker at every opportunity, adjusting targets again and again, an announcing new surprise policies to keep political opponents off balance.

The new Chancellor, Philip Hammond, as befits his reputation as 'dull', has suggested he'd like the Autumn event to go back to being just a rudimentary update, rather than a full blown budget adjustment. And considering the economic situation, that might not be a terrible idea.

An economy runs principally on the basis of confidence and Hammond has everyone to reassure: Brexiters and 48ers; the banks; businesses big and small, and workers. Whatever advantage Osborne's constant surprises afforded him in the political arena, would only have been yet another element of volatility in an already volatile time.

As well as provide assurance of a steady hand, Hammond must also find a way to satisfy his party's extreme right-wing - while, for sake of the appearance of competence, avoiding the complete repudiation of the actions of the previous Conservative ministry. That means maintaining at least token continuity with his predecessor's insistence upon tackling the deficit at the expense of front line services.

If those matters weren't hard enough to juggle, Hammond must also find a way to meet the new commitments made by the new Prime Minister Theresa May. That means, at the least, finding some way to slow down austerity just enough to help those who are 'just getting by'.

In times of high drama, a period of calm, anchored in fiscal stability and dullness, with no unpredictable moves and longer term planning - that actually sticks to a long term economic plan - would usually be a thing very welcome, for any economy. If that is what Hammond brings, it signals, hopefully, a return  to managing fiscal matters with a long term view, rather than with short term grandstanding better fitting a corporate boardroom.

However, the new Chancellor doesn't have the luxury of simply postponing a little of austerity programme and holding station. To that effect, Hammond has already deprioritised his predecessor's constantly shifting deficit targets and proposed a small increase in spending to a improve some roads, with May herself adding today the promise of a little more research and development funding. These steps are clearly an effort to show concerns - that withdrawing too much Government money, too quickly, will only make straightened times leaner - have been acknowledged.

Yet Hammond is rightfully under pressure from the Left to do more. John McDonnell, the Labour Shadow Chancellor, has also called for the undoing of tax breaks for the richest that were delivered by George Osborne, eve as frontline services and local councils were subjected to stringent budget restrictions.

With the money saved from reversing those measures, McDonnell has called for dropping the next round of welfare cuts, planned out by the treasury under Osborne - that will hit hardest precisely those who the Prime Minister lately pledged to protect: those 'just getting by'.

Socially and economically, the times have become hard and uncertain, and disproportionately for the most vulnerable - for women, minorities, people with disabilities and the working poor. And each of these groups are exposed to a range of risks, pressures and dangers by declining prosperity and rising desperation, as people turn inwards and shield themselves with hostility towards those who should be their neighbours.

While stability for the Conservatives may stop at settling down jittery markets, progressives want the Government to look further afield: to help calm the fears of ordinary people. Hammond's promises of infrastructure spending and pausing austerity are a start. Yet McDonnell isn't wrong to question the record of the Tories on delivery - Osborne made bigger promises of infrastructure spending, that might have helped stimulate the economy if they had ever seen the light of day.

For progressives, the time is long overdue for a budget with more spending commitments: on research and investment, to help stimulate the economy, creating jobs in the immediate present and to lay the foundation for more down the line; on the critical shortfalls in the NHS and social care budgets; on ending, and even reversing, cuts to welfare, to help people during hard times; and on building many desperately need homes.

All of those commitments are expensive and neither debt nor deficit can be completely ignored. But the present status quo simply is not stable. Worrying  about public debts, themselves fairly stable, weighing on the future as a tax burden is madness when the poor, just to get by, struggle under mounting insecure private debts.

And the Government, on the public behalf, is in the strongest position to help. Even just reversing tax cuts and subsidies for rich corporations and individuals - before you even get to the matter of how cheap interest is on Government borrowing - would go a long way to paying for what's needed.

Stability and reassurance are needed. But the Government must act first to create stability, because right now there is desperation and precariousness bordering on disaster. Progressives have to believe that Hammond can and should do more, before he can declare the ship steady, the waters calm and a course plotted for the harsh waters awaiting Britain outside of the European Union.

Oldham will be the first preview of who is winning the political battles in the public eye

Oldham will host the first by-election of this parliament, triggered by the death of Labour MP Michael Meacher. It will be a set piece political event that might just offer some small insights into whether party ideas are capturing the public imagination. Photograph: Oldham Town Hall by Mikey (License) (Cropped)

On Wednesday the Conservative fiscal plan for the next four and a half years was laid out by the Chancellor. Complete with politically considered back tracks and U-turns, George Osborne's spending review laid out the cuts, caps, and the phasing out and shifting of burdens that we should expect.

Yet, even with all of this information now on the table, the question of how to oppose the Conservative approach is putting Labour in a bind. Labour are trying, though not too hard, to avoid fall into a civil war - the result of which would almost be that the New Labour faction would be forced to leave the party and could even taking a majority of Jeremy Corbyn's party MPs with them.

These events are all very poignantly timed, as the first test for all sides - an important trial run, almost - is coming on the 3rd December in the form of the Oldham West and Royton by-election. From its result, it will be admittedly difficult to extrapolate anything particularly substantial.

Not until April, and the National Assembly and London Mayoral elections will we see a full appraisal of the response of the country to the election of a Conservative majority, its policies on human rights and austerity, and Jeremy Corbyn's new approach as leader of the Labour Party. Yet next Thursday's by-election might just provide a small preview.

Voters in Oldham will be the first to pass direct comment on what was, effectively, Osborne's third budget of the year. Those that turn out at the polls for the by-election will get a chance to say what they think of the Chancellor's offerings.

Despite the fact that the focus for most people will be on the headline of Osborne's likely-to-be-popular U-turn on Tax Credits (BBC, 2015) - and the U-turn on cuts to police budgets that he tried to pass off as a Labour idea - there were other policies to be found in the spending review.

These policies include the gradual phasing out of tax credits, to be replaced with the less supportive universal credit (Allen et al, 2015); a new cap on housing benefit (Cross, 2015); and the replacement of grants for student nurses with loans (Sims, 2015).

According to the assessment by the independent Institute of Fiscal Studies (IFS), the poorest will be the most heavily impacted by these changes (Allen et al, 2015) - although that is disputed by Conservatives. Critics have also been sure to point out that austerity is far from over (Wearden, 2015). Further cuts or tax rises may even be necessary if Osborne's gamble on the OBR's positive outlook fails to pay off (Peston, 2015).

Osborne's domestic reforms also appear to match the ideas in his recent speech laying out his plan for the European Union - another issue that may well be on voters' minds. For the Conservatives, the aim is clearly for a deregulated EU that is for business (Sparrow, 2015), rather than citizens - reserving free movement only for trade and money.

Leading the progressive opposition at this point should be the Labour Party. However, Jeremy Corbyn's opposition to intervention in Syria (Wintour, 2015), at least in the present terms and under the present conditions, is proving to be just the latest opportunity for a divide to open up between Corbyn, along with his supporters, and the party's mainstream - particularly in the parliamentary party.

It doesn't seem to be helping to quell the dissent of the few - at the moment, at least - in the Labour Party who support intervention, that even Conservative commentators are saying that the UK's most powerful role right now may well be diplomatic rather than military (Davis, 2015).

There is also the likelihood of a hugely significant event on Tuesday, just days before the by-election, when NHS doctors go on strike, to be followed by two more days of action later in December, if renewed negotiations do not achieve enough ground (Tran, 2015).

Politically, ideologically, there is a lot of pressure building. Yet it won't all be about objective analysis of the impact of policies. Politics is also a contest over the popular perception fought in, and often with, the media. In that game, the Conservatives have tended to fare best, and Osborne has managed to make all of the headlines about how he is protecting, for now at least, those already in the system.

What it is essential for progressives to get across, and rally support behind, is that this is something the Chancellor has only achieved through the shifting of burdens and letting new entrants be hit by the deepest cutbacks (Allen et al, 2015, Cross, 2015). Yet it is always difficult to make heard the narrative based on those who will be hurt in theory, when up against a narrative of those will not now be hurt in the present.

As for other progressive opposition parties, like the Greens and the Liberal Democrats, they will just want to be heard and to see a decent turnout. They both risk being drowned out by the larger narratives coalescing around the two big parties, yet there is room for them to still make an impact. For the Greens, the UN climate change summit in Paris puts the environment and clean energy in the public eye (Vaughan, 2015), while the Lib Dems have been vocal in their opposition to the government over human rights and the rights of refugees (Riley-Smith, 2015) - a key pillar in their plan for a 'Lib Dem Fightback'.

However, set piece events like Thursday's by-election only offer a snapshot impression of where the different factions and parties are, relative to each other, and who is hearing the message sent out by who. The big question - which will likely only be answered in subtle shades of grey - will be whether Osborne has succeeded in getting out the message he wants heard, and whether Corbyn's approach can produce in terms of practical results.

Autumn Statement: Osborne's spending review takes risks & makes U-turns to dodge political storms - but only in the short term

George Osborne wants to be seen as a builder and as a friend to workers. Lower borrowing costs allow him to cut less this time around and tax rises offer more apprenticeships, yet it all rests on a series of gambles. Photograph: The Chancellor with guests at Port of Tilbury on 1 April 2014 by HM Treasury (License) (Cropped)

This was expected to be an announcement of ever deeper cuts than ever before, with £20bn needed to keep on course with Conservative fiscal targets (Kuenssberg et al, 2015). With George Osborne as Chancellor, however, it was never quite possible to be too sure.

The big unexpected move this time around was the Chancellor's decision to drop the proposed cuts to tax credits (Robinson, 2015). Announcing a better than expected fiscal situation, and saying he had listened to concerns, Osborne said it was easier simply to avoid the changes altogether (Politics Home, 2015).

That was accompanied by the announcement of no cuts to police budgets and the frontloading of NHS funding at £6bn next year (ITV, 2015; Dominiczak, 2015). In sum, these announcements gave the impression of a much less stringent budget, on the back of an Office of Budgetary Responsibility (OBR) assessment that more money would be available, with lower borrowing costs, and so less would need to be cut (Reuben, 2015).

These announcements followed the Osborne's habit from previous budgetary statements and announcements, of pulling out a surprise. And yet, for everything that Osborne hasn't cut, he is still gambling on the market bailing him out later by delivering the OBR's predicted strong economic conditions, rewarding him with higher tax receipts, if he is going to meet his own targets.

If expectations and receipts fall short then cuts will still have to be found later. In fact, the observation has been made that the backdown on tax credit cuts is only a temporary stay, as the cuts will still come with its phasing out to be replaced with the universal credit by 2020 (Kuenssberg, 2015; Eaton, 2015).

Burdens are once again being shifted by the Chancellor. Along with the private debts taken on over the last five years by students, joined now by student nurses (BBC, 2015), there will be caps on housing benefits (Peston, 2015). There was also no relief from the Tampon Tax, with the odd decision to maintain the tax but to use it to fund women's charities (Richards, 2015).

The burdens are also being stacked onto local government and the private sector - with new taxes on business to pay for apprenticeships and local government expected to raise local rates to cover certain services (ITV, 2015{2}; Wintour, 2015).

Full analysis of the line-item details will follow from all corners of the media and political world.

Yet the initial impression is that the Chancellor is once again taking a risk. Osborne is gambling on markets and the broader economy to perform well enough to buy him time and space until the political storms blows over - which allows him to wriggle around on the nose cuts, in favour of less dramatic phased changes.

Spending Review Preview: Osborne has led government to bet the house on policies like Right to Buy cutting cost of living

The government's Right to Buy scheme is no more than a stop gap measure in the battle to deal with the housing crisis and does little to shelter the poorest and most vulnerable from affordable housing shortages.

On Wednesday, following PMQs, Chancellor George Osborne will make his Autumn Statement (Parker & Giugliano, 2015). The statement serves as a spending review, assessing how the treasury is faring with its budget plan, a plan that is dependent upon many factors.

The review will give the country a chance to peek inside Number 11 and discover, through the obscuring lens of politics-speak, how the Chancellor intends to achieve his planned cuts (Wheeler, 2015) - particularly after the damage done by Lib Dem, Labour and Crossbencher Lords to his attempts to cut spending on tax credits (BBC, 2015).

The view amongst independent assessors is that Osborne's cuts are set to have a drastic impact on those carrying the heaviest working burdens for the least reward (Ross, 2015; Milligan, 2015). With more money now having to found to lessen the burden on those losing tax credits, there are clear fears that those funds will be found simply by taking even more away from others (Wintour, 2015).

There is only one thing that can temper the impact of Chancellor Osborne's cuts, and that is the much vaunted efficiency of markets that those on the Right put so much faith in. Without increased efficiency, most tellingly demonstrated by a fall in the cost of living, the impact of welfare cuts will be drastic and long-lasting.

By far and away the most impactful part of the cost of living is the cost of housing. The Conservative's darling policy for this end is their 'Right to Buy' scheme, yet the scheme is controversial. The project offers huge discounts for housing association tenants to buy their rented houses, with certain terms and conditions (Sarling, 2015). Yet the project will be costly and the losses could very well fall most hard upon the housing associations themselves and councils, especially in the most deprived areas.

The intention, plainly, is to increase the number of houses on the buyers' market, so as to increase supply, and so competition, in order to decrease costs. However, the plan can only represent a stop gap, buying time for building of more houses. It cannot be a replacement for it.

Back in 2014, Alicia Glen, New York's Deputy mayor for housing and economic development, assessed the issue of housing affordability by drawing attention to problems with the UK's private rental sector (Murray, 2014). Glen remarked that the private rental in the UK is comparatively small and that management of private rental properties on a small scale is expensive and inefficient, stressing that only at a large scale can its costs be effectively reduced.

"The problem is if you don’t do affordable housing as rental housing by definition you’re going to lose that unit unless you have incredibly aggressive enforcement on resale. You could say - and a lot of conservatives would say - there’s nothing wrong with subsidising the production of a unit if a poor person lives there and 10 years later they sell it for a gazillion dollars - they’ve made money and that’s wealth creation. But you’ve lost the unit and so you’re not making any sort of long-term dent in the affordable housing crisis."

And yet, reports are pointing out that the scheme is already failing to tackle the essential problems of the housing crisis (Gallagher, 2015). Instead of increasing the availability of affordable housing, as many as two-fifths of Right to Buy properties have simply been let out privately by their new owners.

This so-called 'pillaging' of social housing is only a temporary means of diverting the housing crisis (Hutton, 2015). It takes affordable housing away from the poorest and most vulnerable to temporarily increase housing supply for those on middle incomes. Yet it doesn't break the cycles of debt and lending, along with asset investments which all drive up prices, and simply adds more properties to yet another housing bubble.

With Osborne's budget, everything depends upon the cost of living consistently falling. Yet without breaking the housing bubble, without a large increase in supply and competition, and without a scaling up of the operation of private rental - a project in which co-operatives should not be ruled out - the essential problems are not going to be fixed. The cost of housing will not fall, and so the cost of living will not fall.

If the cost of living does not fall, then Osborne's huge contraction of state spending, and the services and safety nets that funding supports, mean that the poorest and most vulnerable will be trapped. With cuts to support, along with wages and hours being reduced and made ever less secure, the poorest will be even further excluded - with housing, left in the hands of schemes like Right to Buy, becoming just another social mobility ladder that has been kicked away.