Showing posts with label Universal Credit. Show all posts
Showing posts with label Universal Credit. Show all posts

Monday, 26 November 2018

May calls on MPs to get on with Brexit and move on - but it's her government's own doing that it's consumed all political space

This afternoon, Theresa May addressed the Commons to present the terms she has negotiated for Britain's exit from the European Union. As may well have been expected at this point, it did not get a warm reception. All the big hitters were queued up to get in their licks.

After yet another hostile session, the Prime Minister may very well have been feeling like the constituents she has now taken to quoting: ready to just get on with Brexit and move on. But it's the PM's own approach that has brought us to this Parliamentary impasse.

A referendum, a snap election and two years of legislative time have been poured into Brexit - along with billions from the treasury and repeated knocks taken by the economy with the instability caused by each new jarring announcement.

In that time, domestic policy has taken the backseat. That has been a disaster both in terms of scrutiny and delivery.

The government's flagship welfare 'reform' the Universal Credit has rolled from one crisis to another. Supposed to be the consolidation of a number of different welfare programmes into a more efficient and affordable system, it has faced ever mounting problems.

The minister who had been the driving force behind it quit when he was severely undercut on funding. The attached fitness assessments have been derided as cruel. Even a rapporteur for the United Nations has deeply criticised the misery inflicted upon the most vulnerable by a government pursuing ideological ends.

The government has claimed that Universal Credit has driven people into work, but this welfare system - underfunded, misadministered, and leaving vulnerable people at the mercy of growing debts - can only have motivated people in the worst way, with employment statistics covering an explosion in working poverty.

And those are just the headlines. The government has not done enough on housing. It has not done enough to meet environmental and energy targets. It has not done enough to encourage an economic system that can lift ordinary people out of poverty - on welfare or in work.

When Theresa May talks of constituents telling her to get on with Brexit, she may be reframing disgruntlement. It's May's government that has turned politics in Britain into nothing but Brexit - and in the process has managed to deeply divide the country.

With so many domestic issues in need of attention, Brexit needs to be settled. But what Parliamentarians can't do is make a hasty decision under pressure - for which the Prime Minister is pushing.

May's government has put us here and shouldn't be allowed to use it to sneak out from under their own mess.moving towards resolving the deeply important and long term domestic issues that have gone unattended under May's watch.

Monday, 8 October 2018

Universal Credit: Labour say no to universal credit, leaving the future of welfare uncertain

Photograph: Job Centre Plus by Andrew Writer (License) (Cropped)
Labour's Shadow Chancellor John McDonnell has let it be known that Universal Credit, the government's controversial revamp of welfare, faces being scrapped. McDonnell called the system unsustainable, as he finally appeared to move the party off the fence on welfare.

Universal Credit was the flagship Conservative policy and was intended to merge a range of benefits into one, simpler, payment - with better tapering and stricter limits - in theory to 'make work pay'. However, the rollout of the policy has been a disaster.

The policy rollout has gone over budget; it has created delays in processing applications and making payments, leading to individuals running up debts and turning to foodbanks; and with the full rollout, even single parents could be over £2000 worse off.

For the government, welfare reform has been a constant hazard. It's approach, dubbed 'workfare', has been picked apart at every step. Scandals like welfare claimants finding themselves farmed out for unpaid labour - a practice that was challenged and criticised through the courts, though continues - has undermined reforms.

So has the Tories' handling of disability welfare claims. Causes ranging from maladministration to deeply flawed fitness to work assessments have left many claimants with disabilities thousands of pounds out of pocket and denied crucial support.

The government has done itself no favours with revelations that officials were given targets to reject 4 out of 5 applications, and through spending tens of millions in legal action to avoid having to meet denied disability welfare payments.

Funding issues have undermined the policy too. The policy's architect, and former Tory leader, Iain Duncan Smith eventually quit as the Minister responsible with a flurry of criticism - at the core, furious that funding was not were he wanted it to be for the reforms to work.

It is unsurprising that Labour doesn't want to handle this shambles.

However, for Labour this marks a significant change in their stance. In their 2017 manifesto, the Labour Party barely touched the subject of welfare. The limits of their interest had seemed to be in getting the Conservative system working - not even committing to more funding.

Labour have not proposed a replacement system. For that, it may be necessary to wait for a new manifesto. But it seems unlikely that either the old system nor Universal Credit will now remain in place under a Labour government.

Without tacit opposition support, the policy's days are numbered. The questions now is what comes next? Where does Britain go next in search of a fair and sustainable social security safety net?

Wednesday, 22 November 2017

Budget 2017: Cautious Hammond has salves not solutions, as Budget falls short of action

Chancellor Philip Hammond was in bombastic mood for delivering his second Budget of 2017, making jokes despite the Office of Budget Responsibility's projections that listed productivity as down and growth falling. He brushed past those figures with lots of Brexiter-placating language and an opening salvo of £3bn put aside to get the country Brexit ready.

In the build-up to the Budget, Sarah Ann Harris in The Huffington Post UK posted an article listing those measures that charities said would be needed to address Britain's varied crises. Together, they would have required at least £10bn of new funding.

In the Budget, Hammond acknowledged the pressures and hardships and said that he was prepared to invest. But when the announcements came, they ultimately offered no more than half of the requested amounts to alleivate hardships.

On the disastrous impact of Universal Credit, Hammond went halfway towards the requests, even of MPs on his own benches, of reducing restraints on claimants - taking one week rather than two out of the waiting time to receive funds. With other easing measures, Hammond called this a £1.5bn package of support. Yet this was step didn't even reach the minimum requests for alleviation.

On the NHS, the Chancellor offered up some large numbers. These break down to smaller numbers, though. The figure of £10bn, for capital spending - infrastructure, buildings, etc - is spread across the five years of the Parliament, meaning no more than £2mn-£3mn a year. Another £2.8bn will be spread over three years, with just £350mn front-loaded to avert crisis this winter.

There was an olive branch to nurses in the form of a commitment to fund a pay rise for nurse, but this was conditional on negotiating a new contract settlement with the Health Secretary Jeremy Hunt.

To address the housing crisis, and in particular affordability, the Chancellor announced a £44bn fund. This was, however, then broken down. This fund would be only partly public funding, with the other parts being loans and guarantees, and was intended to run through to the middle of the 2020s.

That could stretch that £44bn over eight years, or even more, meaning the yearly amount would actually be much lower, at around £5bn-£6bn - of which only a part would be a public funding rise.

At most this overall package, to tackle a range of social crises in Britain, will come to £2.4mn/year, plus only a part of the around £6bn/year package being invested in the housing market. That looks like being a long way short of the £10bn minimum requested.

The Chancellor found some money to invest, with £500m for various areas of tech, a few billion more to extend the Nation Productivity Fund, and a new £2.5bn fund to support new innovative, knowledge intensive, companies. Another £1.7bn was found for cities and city regions for various local infrastructure projects. The reality though, is that most of that will be spread over several years.

The Conservative Chancellor framed this as rejecting extra borrowing and instead using some of the headroom within his fiscal rules. However, there are still questions over how the Chancellor is going to fund these and the reality is there will still be lots more borrowing, with the process of eliminating the  debt and deficit extended over a longer period.

The headline offer made by Hammond was to end Stamp Duty for first time home buyers on homes up to £300,000. While this was trailed as a boon to young people, the reality is that it will serve current homeowners best - likely helping and subsidising current people who are, on the face of it, more likely to already be Tory voters.

The cautious Chancellor had hedged his bets with this Budget. He has tried to appeal to all sides, to make everyone feel like they came out of this Budget with a little something. The reality is that no one has gotten what they wanted, although Brexiters may have been midly appeased by £3bn and adopting their rhetoric.

Social pressures in Britain demand a response, but the Chancellor has decided not to act. Hammond has stuck with cheap salves rather than paying for the solutions. To make real progress, we need more from the Exchequer.

Monday, 20 November 2017

Budget 2017: Hammond gets a second attempt at Budget 2017, but will he act?

Photograph: NATO Summit Wales 2014 by the Foreign and Commonwealth Office (License) (Cropped)
On Wednesday, Chancellor Philip Hammond will present his second Budget of 2017. It has been trailed with promises of doing more. But the big question is whether any of the measures will be enough.

Between the growth of wages being anaemic, price rises eating away at households and the private sector not stimulating any positive movement by holding back from investment, it's being argued that Hammond has cornered himself against his own fiscal rules.

The government has made big promises - or at least big announcements, with little that is tangible behind them. The governing reality has frequently been the denial of the existence of a crisis, making excuses or tinkering around the edges.

Consider the big pledges Hammond has made on housing. The Chancellor has refused much needed additional funding, so tinkering measures - such as adjusting stamp duty or loosening restrictions on councils borrowing to build homes - are expected to carry the burden of getting the government to 300,000 new homes a year.

That will mean achieving the completion of around 100,000 extra homes, each year, to reach the target. Which makes it relevant to note that this is, of course, the same pledge that hasn't been met over the last seven years - at times struggling to reach 100,000 at all, never mind an extra 100,000.

These kind of promises, made over and again only to be missed, serve to undermine future pledges to do more. So too, do gaffes like Philip Hammond's Mitt Romney -esque announcement on Sunday that there are no unemployed people (there are).

It hurts the government too, that funding is denied where it is asked for by services, but is magically pulled out of thin air to solve the latest Conservative political crisis - a billion to secure a DUP-Con deal, for example.

The denials, excuses and tinkering extend to other areas. The NHS is expected to be denied the £4 billion in extra funding it's chief has demanded and the existence of a healthcare crisis has been refused.

These attitudes, these tinkering measures, point towards Hammond's approach to the last Budget, which responded to big challenges with a 'steady as she goes' attitude, spending in the millions not the billions.

There are questions still ahead, however, and people who remain vulnerable. What tinkering will help those women, particularly young women, suffering from period poverty? How will tinkering, with cautious suggestions of reducing waiting times, deal with welfare debt traps?

Universal Credit, in the midst of a disastrous rollout, is exacerbating problems - like mounting rental arrears and the simple fact of more than a month without a means on which to live - that are entangled with all areas of life for the most vulnerable.

While the government may be more focused on avoiding any further embarrassments, of which it has had a string lately, by avoiding any backtracks and climbdowns - such as the major reversal on self-employed National Insurance changes back in the spring.

But now is not the time for 'little c' conservatism. Change will perhaps undermine the Conservative position, ever talking of the chaos Labour will unleash by deviating from their fiscal restrictions.

But the Tories failure to match their rhetoric with reality is a party affair. The wellbeing of the people has to come before the wellbeing of the party. It is time to act.

Monday, 8 February 2016

As the Conservative Welfare Bill goes to an activist House of Lords, progressives need to speak out for the alternatives

The House of Lords has become an ironically activist body in opposition to the Conservative majority in the Commons that is trying to substantially restructure social security in Britain.
On Tuesday the Conservative government's Welfare Reform and Work Bill returns to the Lords for its third reading. The bill is a key part of the Conservative pursuit of their roundly inspecific manifesto promise of billions in 'welfare savings' - including attempts to scrap child poverty measures, to introduce a total Household Benefits Cap, to freeze benefits and to restrict Child Tax Credits (Treloar, 2015).

In Autumn, the Chancellor dodged public criticism by dropping plans to make cuts to Tax Credits, aided by a gamble on positive economic forecasts (ITV, 2015). Yet, as was recorded at the time, this was only a matter of delaying the inevitable (Kuenssberg, 2015; Eaton, 2015). The intention was still, in time, to phase out Tax Credits and fold them into the Universal Credit.

Now its again the turn of the Universal Credit to face cuts (BBC, 2016). The Institute for Fiscal Studies has stressed that changes will leave many of the poorest people thousands of pounds worse off. Once more the burden of paying down the deficit and debt has been shifted around, disguised, and then left upon the poorest, on those who are struggling the most.

If other opposition has been quiet - with the Labour Party in its pre-Corbyn interim under Harriet Harman abstained in the bill's early phases (Guttenplan, 2015) - it may only be because the political system renders them powerless.

Its true that the government has already been defeated in an ironically activist House of Lords over its welfare plans on both Tax Credits (Morris & Grice, 2015) and the attempt to scrap Child Poverty measures (Mason, 2016; Mortimer, 2016) - with Liberal Democrats who in particular seem determined, weak though their mandate has now become, to use their, problematic but still considerable, presence in the House of Lords to oppose the cuts in Parliament. Yet with a Conservative Commons majority, any opposition could eventually be overcome.

One the biggest criticisms of the Conservative majority is that it has sought to balance the books without sufficient concern for the human cost in the present (Sikka, 2015; Boffey, 2014). The focus of the Conservative government on 'making work pay' has mostly been an exercise in relativism - making work seem relatively more profitable by punishing, hassling and impoverishing those in need of welfare.

For progressives there is a responsibility to look to other ways that do not accept the casualties of the present as an inevitable tragedy and to speak out, especially at a time when the most vulnerable are losing their voice by falling off electoral registration lists and so being under-represented (Mason, 2016{2}). At present, the most exciting alternative is the Basic Income.

On trial in the Netherlands and Finland (Perry, 2015; Unkuri, 2015), the Basic Income is a form of universal welfare, provided to all citizens unconditionally. It acts as a level of subsistence support that is always available, aiming to alleviate all citizens from the fear of falling into, and the desperation of being in, poverty.

On a practical level, it would replace most in-work benefits. From the personal income tax allowance - which might be seen to fulfil a similar role through a tax discount, only provided on the condition that you work for a wage, at a cost of an estimated £86bn - to tax credits and the jobseekers allowance - costing £30bn and £3bn, respectively.

The ongoing economic struggle continues to disproportionately hurt the most vulnerable. Austerity has little to offer them, depending more upon negative liberty, the removal of limitations, than positive liberty, providing a leg up to opportunities.

Laissez faire is not enough. Visibly rising homelessness and the need for food banks is not good enough. A civilised society should be able and prepared to take care of the most vulnerable. Progressives have to be prepared to look for and propose solutions, with more compassion, that act to end poverty.

Wednesday, 25 November 2015

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.