The war on welfare scroungers, part 94

Jobcentres are "tricking" people out of benefits to cut costs, says whistleblower.

He says that he will watch the banks "like a hawk" but allows bankers to walk away with taxpayer-funded, multimillion-pound bonuses. He says he cares about the poor but cracks down on welfare claimants. Such is our Prime Minister, David Cameron, the "compassionate Conservative".

In Prime Minister's Questions on Wednesday, Cameron said:

Far too much in our system is lost from fraud and error and I do not think that taxpayers go to work and work hard in order to fund benefits to which people are not entitled.

Yet, as I noted on Twitter at the time, tax evasion costs the UK exchequer more than 15 times as much as benefit fraud. Why do we not hear the PM condemning tax evasion with the same vigour and regularity with which he raises the subject of benefit fraud? Instead, Cameron kicked off PMQs by condemning and defaming the anti-tax-evasion group, UK Uncut.

The coalition's "war on welfare scroungers", however, continues unabated. Here is a shocking story from today's Guardian:

Rising numbers of vulnerable jobseekers are being tricked into losing benefits amid growing pressure to meet welfare targets, a Jobcentre Plus adviser has told the Guardian.

A whistleblower said staff at his jobcentre were given targets of three people a week to refer for sanctions, where benefits are removed for up to six months. He said it was part of a "culture change" since last summer that had led to competition between advisers, teams and regional offices.

"Suddenly you're not helping somebody into sustainable employment, which is what you're employed to do," he said. "You're looking for ways to trick your customers into 'not looking for work'. You come up with many ways. I've seen dyslexic customers given written job searches and when they don't produce them -- what a surprise -- they're sanctioned. The only target that anyone seems to care about is stopping people's money.

"'Saving the public purse' is the catchphrase that is used in our office . . . It is drummed home all the time -- you're saving the public purse. Feel good about stopping someone's money, you've just saved your own pocket. Its a joke."

The claims came as the big businesses handed contracts to get the long-term jobless into work today said the government should privatise jobcentres so that their firms could work with people who have been jobless for less than a year.

Statistics from the Department for Work and Pensions (DWP) show the total number of cases where people have lost their benefits has soared since the beginning of 2010 to 75,000 in October, the latest month available. The figures also reveal the number of claimants with registered disabilities being cut off has more than doubled to almost 20,000 over the same period.

This follows a change in the rules in April last year where sanctions were extended to claimants who were late for jobcentre interviews and other less serious offences.

So much for the "morality" and "Christian ethics" of the Work and Pensions Secretary, Iain Duncan Smith. This is a callous and cruel coalition government, engaged in a war on not just welfare "scroungers" but on the poorest and most vulnerable members of our society.

Mehdi Hasan is a contributing writer for the New Statesman and the co-author of Ed: The Milibands and the Making of a Labour Leader. He was the New Statesman's senior editor (politics) from 2009-12.

Photo: Getty Images
Show Hide image

The Conservatives have failed on home ownership. Here's how Labour can do better

Far from helping first-time buyers, the government is robbing Peter to pay Paul

Making it easier for people to own their own first home is something to be celebrated. Most families would love to have the financial stability and permanency of home ownership. But the plans announced today to build 200,000 ‘starter homes’ are too little, too late.

The dire housing situation of our Greater London constituency of Mitcham & Morden is an indicator of the crisis across the country. In our area, house prices have increased by a staggering 42 per cent over the last three years alone, while the cost of private rent has increased by 22 per cent. Meanwhile, over 8200 residents are on the housing register, families on low incomes bidding for the small number of affordable housing in the area. In sum, these issues are making our area increasingly unaffordable for buyers, private renters and those in need of social and council housing.

But under these new plans, which sweep away planning rules that require property developers to build affordable homes for rent in order to increase the building homes for first-time buyers, a game of political smoke and mirrors is being conducted. Both renters and first-time buyers are desperately in need of government help, and a policy that pits the two against one another is robbing Peter to pay Paul. We need homes both to rent and to buy.

The fact is, removing the compulsion to provide properties for affordable rent will be disastrous for the many who cannot afford to buy. Presently, over half of the UK’s affordable homes are now built as part of private sector housing developments. Now this is going to be rolled back, and local government funds are increasingly being cut while housing associations are losing incentives to build, we have to ask ourselves, who will build the affordable properties we need to rent?

On top of this, these new houses are anything but ‘affordable’. The starter homes would be sold at a discount of 20 per cent, which is not insignificant. However, the policy is a non-starter for families on typical wages across most of the country, not just in London where the situation is even worse. Analysis by Shelter has demonstrated that families working for average local earnings will be priced out of these ‘affordable’ properties in 58 per cent of local authorities by 2020. On top of this, families earning George Osborne’s new ‘National Living Wage’ will still be priced out of 98 per cent of the country.

So who is this scheme for? Clearly not typical earners. A couple in London will need to earn £76,957 in London and £50,266 in the rest of the country to benefit from this new policy, indicating that ‘starter homes’ are for the benefit of wealthy, young professionals only.

Meanwhile, the home-owning prospects of working families on middle and low incomes will be squeezed further as the ‘Starter Homes’ discounts are funded by eliminating the affordable housing obligations of private property developers, who are presently generating homes for social housing tenants and shared ownership. These more affordable rental properties will now be replaced in essence with properties that most people will never be able to afford. It is great to help high earners own their own first homes, but it is not acceptable to do so at the expense of the prospects of middle and low earners.

We desperately want to see more first-time home owners, so that working people can work towards something solid and as financially stable as possible, rather than being at the mercy of private landlords.

But this policy should be a welcome addition to the existing range of affordable housing, rather than seeking to replace them.

As the New Statesman has already noted, the announcement is bad policy, but great politics for the Conservatives. Cameron sounds as if he is radically redressing housing crisis, while actually only really making the crisis better for high earners and large property developers who will ultimately be making a larger profit.

The Conservatives are also redefining what the priorities of “affordable housing” are, for obviously political reasons, as they are convinced that homeowners are more likely to vote for them - and that renters are not. In total, we believe this is indicative of crude political manoeuvring, meaning ordinary, working people lose out, again and again.

Labour needs to be careful in its criticism of the plans. We must absolutely fight the flawed logic of a policy that strengthens the situation of those lucky enough to already have the upper hand, at the literal expense of everyone else. But we need to do so while demonstrating that we understand and intrinsically share the universal aspiration of home security and permanency.

We need to fight for our own alternative that will broaden housing aspirations, rather than limit them, and demonstrate in Labour councils nationwide how we will fight for them. We can do this by fighting for shared ownership, ‘flexi-rent’ products, and rent-to-buy models that will make home ownership a reality for people on average incomes, alongside those earning most.

For instance, Merton council have worked in partnership with the Y:Cube development, which has just completed thirty-six factory-built, pre-fabricated, affordable apartments. The development was relatively low cost, constructed off-site, and the apartments are rented out at 65 per cent of the area’s market rent, while also being compact and energy efficient, with low maintenance costs for the tenant. Excellent developments like this also offer a real social investment for investors, while providing a solid return too: in short, profitability with a strong social conscience, fulfilling the housing needs of young renters.

First-time ownership is rapidly becoming a luxury that fewer and fewer of us will ever afford. But all hard-working people deserve a shot at it, something that the new Conservative government struggle to understand.