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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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We're beginning to see what Brexit might look like

 If success means sluggish growth and increasing the amount that the state has to pay to large multinational companies to persuade them to stay, there is growing evidence that Brexit may be a success.

Today’s growth figures are out, and they show no signs of a post-leave vote slowdown, with growth down by just 0.2 per cent, to 0.5 per cent in the third quarter of 2015.

But the really good news is that Nissan will make the next generation of the Qashqai at their factory in Sunderland. Local MPs and the government had both feared that Britain’s out vote would result in the closure of the plant, or at least a dramatic reduction in the size of its operations.

Instead, production will continue, saving 7,000 jobs directly, and many more in both the pipeline and in servicing the needs of the factory’s employees.

All of which is causing the Brexit boosters to proclaim that the fears of the Remain campaign have been shown to be Brexit boosters have leapt on the news, arguing that it shows that the worries about Brexit were a fuss over nothing. Are they right?

Well, sort of. As I’ve written before, it really is worth remembering that we haven’t actually left the European Union yet. And as Mark Wallace – himself an unapologetic Brexiteer – notes, it is fairly clear that, rightly or wrongly, the markets regard Brexit as a bad thing. Many seem to still be betting on an incredibly soft Brexit – or no Brexit at all.

So, anyone celebrating the “success” of Brexit or pointing out that it has failed needs to wait a little while. But even these good figures show some cause for alarm – there is a contraction in the construction industry, generally the canary in the coal mine as far as the British economy is concerned.

And what about the Nissan deal? Reuters are running a story saying that they agreed to continue operating in Sunderland after the government pledged to support and if need be compensate Nissan should Brexit make it harder to operate in the United Kingdom. Neither Downing Street nor Nissan have commented, though Nissan thanked the government for its “support and assurances”, when announcing the deal. I am told by a well-placed source that Nissan did indeed receive guarantees about the future of the plant from the government.

We can expect to see a lot more of that sort of thing in the future. As I've written before, the government's best-case scenario involves not cutting, but likely increasing the amount that it pays both to the European Union and to the EU27 for a level of access to the single market that allows the City of London to maintain its primacy as a financial centre. It's striking that Theresa May has kept a firm line on increasing British sovereignity, by getting out of the European Court of Justice and freedom of movement, but not on reducing the size of the United Kingdom's contribution to the Brussels budget. 

So as ever with any story proposing the “success” of Brexit, the question comes back to how you define success. If success means sluggish growth, and increasing the amount that the state has to pay to large multinational companies to persuade them to stay while still handing over cash to Brussels, there is growing evidence that Brexit may be a success. If success means equalling or exceeding the growth of the United Kingdom within the European Union, while freeing up a cash bounty for public services, the prognosis is less good.  

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to British politics.