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Laurie Penny on the human cost of welfare reform

The scandal is that no one is prepared to make a moral case for welfare provision.

The scandal is that no one is prepared to make a moral case for welfare provision.

Who will stand up for the welfare state? Not the Conservative Party, whose mantra - "Making work pay" - has turned out to be a cruel euphemism for slashing already meagre welfare payments and steering the long-term sick into the magical land of jobs. Not Labour, which declined a second reading of the Welfare Reform Bill; after all, its attacks on disability and sickness benefits when in power laid the groundwork for the coalition's planned destruction of the Attlee settlement. And it won't be the press.

With most official statistics indicating that gutting welfare on the brink of a second recession will leave millions in penury, the government has resorted to stoking tabloid hysteria, feeding the weekend papers a ready-boxed scare story tied with a thick ribbon of prejudice. Details of the most ersatz claims used by fraudulent welfare claimants have been distributed to build the growing consensus that the poor are simply not worth looking after. This is a consensus that nobody in opposition seems to have the guts to challenge.

In reality, benefit fraud rates remain stubbornly low, at 1 per cent. For every person who claims that a fear of ladders prevents them from cleaning windows, there are 99 others for whom incapacity or unemployment benefits are a vital lifeline. So vital that staff at jobcentres have been issued a six-point plan for how to deal with rejected claimants at risk of suicide. The government appears relaxed about the human cost of welfare reform.

The headline figure is that benefit fraud costs taxpayers £1.6bn each year. That figure is a fabrication. According to statistics from the Department for Work and Pensions, this includes over £600m in "official" and customer errors. Factoring out pension scams, the figure is just £250m. To put that number in its proper context, the most conservative estimates hold that corporate tax avoidance costs the Treasury £25bn per year: 100 times the cost of benefit fraud.

Moral case

Threatening the workless with destitution may make good headlines but it is no way to increase employment when there are no jobs to go to. Unemployment in Britain stands at 2.5 million, including almost a million under-25s. The employment minister, Chris Grayling, wants us to believe that the private sector will provide jobs for these people, as well as another million public-sector workers and welfare recipients who will soon be joining the dole queue. Unfortunately, private-sector employment has flatlined, there are six dole claimants for every vacancy and Father Christmas is just your dad faffing about in a nylon suit.

There used to be a liberal consensus that it was the government's responsibility to provide employment and ensure that those unable to work were entitled to a minimum standard of living. As the Welfare Reform Bill oozes unchallenged through the Commons, the real scandal is not that the government is lying through its teeth in order to justify its evisceration of the welfare state. The scandal is that no one in Westminster is prepared to make a moral case for welfare provision as the honest heart of social democracy.

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

This article first appeared in the 06 June 2011 issue of the New Statesman, Are we all doomed?

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Leader: The angry middle

As a sense of victimhood extends even to the middle classes, it makes Western democracies much more difficult to govern.

Two months after the United Kingdom’s vote to leave the European Union, it remains conventional wisdom that the referendum result was largely a revolt by the so-called left behind. Yet this is not the full picture. Many of the 52 per cent who voted Leave were relatively prosperous and well educated, yet still angry and determined to deliver a shock to the political system. We should ask ourselves why the English middle class, for so long presumed to be placid and risk-averse, was prepared to gamble on Brexit.

Populism has long appealed to those excluded from political systems, or from a share in prosperity. In recent years, however, its appeal has broadened to young graduates and those on above-average incomes who also feel that they have not benefited from globalisation. The sense of middle-class victimhood has become a major strand in Western politics.

In the United States, middle-class anger has powered support for Bernie Sanders and Donald Trump. The former drew his activist base mostly from young liberals. And while Mr Trump’s success in the Republican primaries was often attributed to a working-class insurrection against “the elites”, exit poll data showed that the median yearly income of a Trump voter was $72,000, compared with a national average of $56,000. (For supporters of Hillary Clinton, the figure was roughly $61,000.) It is not the have-nots who have powered Mr Trump’s rise, but the have-a-bits.

In the UK, similar forces can be seen in the rise of Jeremy Corbyn. Indeed, research shows that three-quarters of Labour Party members are from the top social grades, known as ABC1. About 57 per cent have a degree.

Mr Sanders, Mr Trump and Mr Corbyn have very different policies, ideologies and strategies, but they are united by an ability to tap into middle-class dissatisfaction with the present order. Some of that anger flows from politicians’ failure to convey the ways in which society has improved in recent years, or to speak truthfully to electorates. In the UK and much of the West, there have been huge gains – life expectancy has risen, absolute poverty has decreased, teenage pregnancy has fallen to a record low, crime rates have fallen, and huge strides have been made in curbing gender, sexual and racial discrimination. Yet we hear too little of these successes.

Perhaps that is why so many who are doing comparatively well seem the most keen to upset the status quo. For instance, pensioners voted strongly to leave the EU and are the demographic from which Ukip attracts most support. Yet the over-65s are enjoying an era of unprecedented growth in their real incomes. Since 2010, the basic state pension has risen by over four times the increase in average earnings. 

Among young people, much of their anger is directed towards tuition fees and the iniquities of the housing market. Yet, by definition, tuition fees are paid only by those who go into higher education – and these people receive a “graduate bonus” for the rest of their lives. Half of school-leavers do not attend university and, in a globalised world, it is their wages that are most likely to be undercut by immigration.

However, we should not be complacent about the concerns of the “angry middle”. The resentment exploited by Donald Trump is the result of 40 years of stagnant median wages in the United States. In Japan and Germany, median wages have not increased in the past two decades. In the UK, meanwhile, the median income for those aged 31-59 is no greater than it was in 2007, and those aged 22-30 are 7 per cent worse off, according to the Institute for Fiscal Studies.

To compound the problem, the wealthy keep getting wealthier. In 1980, American CEOs were paid 42 times the wage of the average worker. They are now paid 400 times as much. In the UK, the share of household income going to the top 1 per cent has more than doubled since 1979. Because of our hyperconnected, globalised media culture, we see more of the super-rich, fuelling feelings of resentment.

As a sense of victimhood extends even to the middle classes, it makes Western democracies much more difficult to govern, with voters oscillating between populists of the left and the right. The political centre is hollowing out. Rather than pander to the populists, we must do more to quell the politics of victimhood by addressing the root of this corrosive sense of grievance: entrenched inequality. 

This article first appeared in the 25 August 2016 issue of the New Statesman, Cameron: the legacy of a loser