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Laurie Penny: A divided society

The chasm in our society is no longer between left and right, but between rich and poor.

For all the talk of one-nation Conservatism, the shadow-play of social injustice begins as soon as you step on to the train to the Tory party conference. Flinging my huge rucksack between the nearest doors just as the Birmingham train is about to pull away, I find myself moving through the low-lit hush of the first-class carriages. Wobbling through the half-empty aisles, I spot two Conservative councillors and several well-known columnists from the Times, the Guardian and the Telegraph curled comfortably in the spacious armchairs, over newspapers and coffee -- but through two sets of sliding doors are the cheaper seats.

Back here, it's stressful and there's not enough space. Standard class on the 8.50 Virgin Trains service is crowded with shift workers, students heading back to college after weekends at home -- and protesters. People from all corners of the country have given up their weekends to attend the national anti-cuts, pro-welfare demonstration convened by the Right to Work campaign and many of them are squeezed into the narrow red pens of Virgin's stock, shut off from the elbow-room of first class by a surcharge that makes all the difference. I drift off into a disturbing dream that Richard Branson is now running the welfare state, and several lurching delays later the denizens of standard class stumble out into Birmingham New Street, rumpled and irritable as only the British public can be after two hours crammed into a rolling metaphor for the state of the nation.

By noon, I am huddled in a car park under a dirty formica sky with several thousand welfare recipients, public-sector workers, local kids and union reps, getting thoroughly and miserably rained on. The press has dismissed the protest as union-led and union-run, because we now live in a world where "trade-union member" is a term of insult, but most of those I meet walking to the march assembly point are unaffiliated citizens. Kathryn, a teacher, says that this is her first protest since the Stop The War march in 2003. "It's mine, too," says Margaret, a retired social worker, who is marching alongside a gang of teenagers from local comprehensive schools. "I don't normally get involved in things like this, but this time, with these cuts, I just felt like I had to say something." "We've got to say something," agrees Kathryn. "It's better than staying quiet."

Everything's entirely quiet in the foyer of the Jury's Inn hotel where politicians and lobbyists are sipping tea in between fringe events. "It's hard to see how any protest will make much of a difference," says one Conservative MP, who refuses to be named. "Everybody knows that we have to make cuts anyway, so nobody's going to take much notice." Other delegates at the bar have heard that there's some sort of ruckus going on in the street, but the retreat into Tory bunker mentality has already begun. Despite this being the first conference in power the Conservatives have held for 14 years, the mood is far from triumphant -- at the fringe events, ministers are already on the back foot, defending the coalition's planned cuts to welfare and public services as calmly as possible.

Back at the march, a crosspatch cross section of British society is voicing its soggy dissent: pensioners grumble about the vehemence of some of the speakers while eating scotch eggs from plastic bags, and dreadlocked students share flasks of tea and foil-wrapped sandwiches with middle-aged mothers pushing prams. There's a curious sense of timelessness to the event. Some of the union reps clearly think they're back in the 1980s, and a dour close-harmony folk band is telling us all about the Hard Times of Olde England, but as the march moves off, it is led by disabled people in wheelchairs and their carers, determined to "show that we're suffering, too". At back of the folk band, moreover, is a man who everyone is trying very hard to ignore, because he is brandishing and occasionally honking through a vuvuzela, an item that seems in 2010 to have finally replaced the pitchfork as the prop of choice for the global working class attempting to annoy and terrify the bourgeoisie.

Meanwhile, just feet away inside the secure zone, behind a wall of steel cordons and police dogs, about the same number of warm, dry conference delegates are, and I'm not making this up, watching some contemporary dance. Specifically, a trio of twee pseudo-ballerinas in floaty saris from something called the Arts Conference, enacting modern interpretations of North Indian traditional dances with very serious expressions. They have been hired to twirl very slowly around the main stage before Francis Maude comes on to explain the "big society", and as he hasn't got a lot to say, they've clearly been instructed to take their time. The audience clap, polite and bewildered. Outside in the rain, the people who actually have to live in the "big society" are already howling for reprieve.

You couldn't have asked for a starker, more cliched illustration of the difference between the political elites and the rest of us if you'd given a toddler a fistful of red and blue crayons and told it to draw a picture of a divided society. The lines being drawn are wobbly and childish, but they are lines of pain and anger, and like the etchings of a traumatised child, they deserve to be paid attention to. The chasm in our society is no longer between left and right. The chasm is between rich and poor, and it's growing, dividing those members of the elite, including the liberal elite, for whom the coming cuts are an abstract if regrettable concept, and the people whose jobs and homes and families are under threat.

Most of the latter have not been able to afford the £400 accreditation process for access to the Conservative conference centre, with its finger-food receptions and winsome catered round tables to discuss whether central government should pull an awkward or merely resolved expression while tearing the heart out of the welfare state and refusing to share the financial burden amongst the wealthy. As delegates and journalists at the Demos grill nibble profiteroles and ask Greg Clark MP why he won't be slightly more forthright about shrinking the state, they seem not to have realised how much they are already resented by a good deal of ordinary people. Either that, or they simply don't care.

Laurie Penny is a contributing editor to the New Statesman. She is the author of five books, most recently Unspeakable Things.

Photo: Getty Images
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The twelve tricks in George Osborne's spending review

All Chancellors use chicanery, and George Osborne is no exception.

There is no great shame to a wheeze: George Osborne is no more or less partial to them than other Chancellors before him. Politicians have been wheezing away since history began. Wheezes aren’t even necessarily bad policy: sometimes they’re sensible as well as slightly sneaky. And we shouldn’t overstate their significance: the biggest changes announced yesterday were described in a clear, honest and non-wheezy way.

But it’s fun to try to spot the wheezes. Here are some we’ve found so far.


  1. Give people less time to pay their tax bills. Yesterday the Chancellor announced tax rises that will raise, in total, a net £5.5bn in 2019-20. A sixth of that total – £900m – results from the announcement that, from April 2019, anyone paying Capital Gains Tax (CGT) on the sale of a house will have to cough up within 30 days. Has the Chancellor made a strategic decision to increase taxes to pay for public services? Not really – he’s just moved some tax forward from the subsequent year to help his numbers stack up, at the price of bigger hassle for people who are selling houses. Not necessarily a bad thing – but a classic wheeze.


  1. Dress up a spending cut as a minor bureaucratic change. The Treasury yesterday announced what sounds like a sensible administrative change to the Government’s scheme for automatically enrolling people into pensions: “to simplify the administration of automatic enrolment for the smallest employers in particular, the next two phases of minimum contribution rate increases will be aligned to the tax years”. Nice of them to reduce bureaucratic hassle for the smallest employers. This also happens to save the Government £450m in 2018-19, because instead of paying an increased subsidy into people’s pensions from January 2018, it will do it from April 2018.


  1. “Tuck under”.  The phrase “tucking under” is a Whitehall term of art, best illustrated with an example. We learnt yesterday that “DfID [the Department for International Development] will remain the UK’s primary channel for aid, but to respond to the changing world, more aid will be administered by other government departments, drawing on their complementary skills.” That sounds like great joined-up government. It also, conveniently, means that the Government can continue to meet its target of keeping overseas aid at 0.7% of Gross National Income, without having to increase DfID’s budget at the same rate as GNI: instead, other departments pick up the slack. Those bits of other departments’ budgets have thus been “tucked under” the ODA protection. See also: the Government is “protecting” the schools budget in real terms, while slashing around £600m from the funding it gives to local authorities to support schools, so that schools will now have to buy those services from their “protected” funding – thus “tucking” the £600m “under” the protected schools budget. (See also: in the last Parliament, the Government asked the NHS to contribute to social care funding, thus “tucking” some social care “under” the protected health budget.)


  1. Cumulative numbers. Most of the figures used in the Spending Review are “in-year” figures: when the Government says it is giving £10bn more to the NHS, it means that the NHS will get £10bn more in 2019-20 than it got in 2015-16. Then you read something like: “The Spending Review and Autumn Statement provides investment of over £1.3 billion up to 2019-20 to attract new teachers into the profession.” That’s not £1.3bn per year – it’s the cumulative figure over four years.


  1. Deploy weasel words. The government is protecting “the national base rate per student for 16-19 year olds”. Sounds great – and it will be written up in many places as “Government protects 16-19 education”. But the word “base” is doing a lot of work here. Schools and colleges that educate 16-19 year olds currently get a lot of funding on top of the “base rate” – such as extra funding for disadvantaged students. Plans for that funding have not yet been revealed.


  1. Pretend to hypothecate a tax. The Chancellor announced yesterday that – because the EU won’t allow him to reduce the ‘tampon tax’ – he’ll instead use the proceeds of that tax to pay for grants to women’s charities. This sounds great – but all he’s really saying is that, among all the many other millions of pounds of grants issued by the government to various causes, £15m will be given to some women’s charities, which might have got that funding anyway. It’s not real hypothecation: it’s not as if women’s charities will get more if there’s a spike in tampon sales. See also: announcing that local authorities can raise council tax so long as they use it to pay for social care – LAs would probably have spent just as much on social care anyway (and other services would have suffered).


  1. Shave away a small fraction of a big commitment. The Conservative party made great play in the election campaign of its commitment to provide 30 hours of free childcare to 3 and 4 year olds in working families. In the July Budget, it made more great play of re-committing to this. Yesterday, it announced that “working families” excluded any parent working less than the equivalent of 16 hours at the minimum wage, or more than £100,000. That sounds like a fairly small change – but it saves the Government £125m in 2020.


  1. Turn a grant into a loan. If government gives someone a grant, that is counted as spending and increases the public sector deficit. If instead the government gives someone a loan, that doesn’t count against the deficit, because it’s assumed that the loan will be paid back (so the loan is like an asset which the Government is holding). Recently we’ve seen a lot of government grants turning into loans – in the July Budget it was student maintenance grants; yesterday it was bursaries for trainee nurses.


  1. “Reverse” a decision that hasn’t happened yet. In 2012 the Government announced that, from April 2016, it would remove the 3% “diesel supplement” that puts a higher tax on company cars that use diesel than on others. Yesterday, it cancelled this, saving over £265m per year for the rest of the Parliament. People complain less about you cancelling a tax cut when you haven’t done the tax cut yet. (Perhaps this doesn’t qualify as a full wheeze, but there’s something wheezy about it.)


  1. “Protect” things in cash terms. If you really want to protect an area of spending, you should at least increase it in line with inflation, so that it can still buy the same amount of stuff. This government – like the Coalition before it – enjoys protecting things only in cash terms. Examples yesterday included the basic rate of funding per 16-19 year old in education, and the entire children’s services budget.


  1. Freeze things in cash terms. Yesterday the government announced that the repayment threshold on student loans – the level above which ex-students must start paying back their loans – will remain frozen in cash terms for 5 years, instead of increasing with earnings (which is what has happened to date). This saves the Government £200m in 2019-20. In a particularly bold move, the Government has even applied this rule to loans that have already been issued – changing the terms on which students took out the loans in the first place.


  1. Hide all these wheezes in sweeping statements. The first chapter of the Spending Review tells us that “£3 billion [of reduction in the deficit] is being delivered through reforms such as Making Tax Digital and further measures to tackle tax avoidance.” The innocuous phrase “reforms such as” covers the bringing forward of £900m in Capital Gains Tax (see number 1 above) and the £450m saved by delaying automatic enrolment into pensions (see number 2 above).

Catherine Colebrook is chief economist at the Institute for Public Policy Research