The euro crisis poses dilemmas for Labour too

Cameron's EU pain is a gift to the opposition, but how far is Ed Miliband willing to go to destabili

Ed Miliband challenged David Cameron in parliament today on his negotiating position ahead of Friday's European Council summit. The charge was that the prime minister has promised something to his backbenchers that he cannot deliver - a repatriation of powers from Brussels. It was a line calculated to probe Tory eurosceptics' anguish over their leader's failure to capitalise on the opportunity (as they see it) of the eurozone crisis to bring about the longed for renegotiation of the UK's relationship with Brussels.

That was a fairly easy hit for a leader of the opposition. Why, when the prime minister's biggest political bruise is exposed, would he do anything other than punch it? At the moment, Labour doesn't really need to do much on Europe other than find new ways to exploit coalition pain on the subject. And just to be clear, there is a lot of pain out there. Cameron is in an appalling position. He has to go to Brussels and somehow persuade fellow EU leaders that he wholeheartedly endorses their plans to save the euro with a treaty for much closer integration, while pointing out that his party thinks a treaty for much closer integration is an affront to democracy and human dignity, so could he please have a bunch of concessions on issues unrelated to the euro, otherwise he might have to veto the whole thing. If he fails to pull that off, his backbenchers will feel betrayed. And if he manages to get concessions, they probably won't be big enough and his backbenchers will demand a referendum on the new treaty. They can sabotage it in parliament if they don't get one.

It all adds up to a Christmas hamper of opportunities for Labour. But if, as is quite possible, the situation turns still more critical for the single currency and David Cameron, Ed Miliband will also have to start formulating a position on his preferred outcome. At the moment, Labour's EU policy has been spelled out by shadow foreign secretary Douglas Alexander. He advocates taking a "hard headed view of Britain's interests", which means supporting plans to stabilise the single currency, while making sure single market rules are not skewed against the UK and pushing for reform to boost European trade. The balance of power between Westminster and Brussels is not ideal, Alexander concedes, but now is not the time to fixate on repatriation of powers.

That, as it happens is not so very far removed from the government's official negotiating position. The key difference is that Cameron actually has to deliver it and his raucous party has made it much harder for him (my column in this week's magazine deals with that in more depth). Meanwhile, Ed Balls has taken the lead for Labour in the economic debate around the single currency crisis and struck a slightly more sceptical tone. He has positioned the party firmly against British participation in any EU bailout funds. He also likes to take the credit for helping Gordon Brown keep Britain out of the single currency when Tony Blair wanted to join. Combined, the two positions make for a kind of cautious scepticism-lite - liking British membership of the EU for pragmatic commercial reasons; ready to like it more if the EU were something it is not.

That is a decent enough holding pattern. But it is not clear how it would evolve if Britain's EU relations lurch into a full-scale diplomatic crisis. Would Labour ever support Tory backbench calls for a referendum on a new EU treaty? The natural law of political opportunism dictates that they must denounce whatever deal Cameron does as a failure (which it probably will be), so should the party then join with Tory rebels and try to defeat it in parliament? If eurozone members proceed with their own fiscal consolidation, Britain's relationship with Brussels will, by definition, be changed. Will Labour then support calls for a more substantial renegotiation, including repatriation of powers? And, what it all comes down to in the end: how eurosceptic is Ed Miliband prepared to make Labour in order to make life really difficult for David Cameron and the coalition?

Labour's current position works as a cautious account of Britain's interests under the circumstances. But those circumstances are changing fast.

Rafael Behr is political columnist at the Guardian and former political editor of the New Statesman

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Universal Credit takes £3,700 from single working parents - it's time to call a halt

The shadow work and pensions secretary on the latest analysis of a controversial benefit. 

Labour is calling for the roll out of Universal Credit (UC) to be halted as new data shows that while wages are failing to keep up with inflation, cuts to in-work social security support have meant most net incomes have flat-lined in real terms and in some cases worsened, with women and people from ethnic minority communities most likely to be worst affected.

Analysis I commissioned from the House of Commons Library shows that real wages are stagnating and in-work support is contracting for both private and public sector workers. 

Private sector workers like Kellie, a cleaner at Manchester airport, who is married and has a four year old daughter. She told me how by going back to work after the birth of her daughter resulted in her losing in-work tax credits, which made her day-to-day living costs even more difficult to handle. 

Her child tax credits fail to even cover food or pack lunches for her daughter and as a result she has to survive on a very tight weekly budget just to ensure her daughter can eat properly. 

This is the everyday reality for too many people in communities across the UK. People like Kellie who have to make difficult and stressful choices that are having lasting implications on the whole family. 

Eventually Kellie will be transferred onto UC. She told me how she is dreading the transition onto UC, as she is barely managing to get by on tax credits. The stories she hears about having to wait up to 10 weeks before you receive payment and the failure of payments to match tax credits are causing her real concern.

UC is meant to streamline social security support,  and bring together payments for several benefits including tax credits and housing benefit. But it has been plagued by problems in the areas it has been trialled, not least because of the fact claimants must wait six weeks before the first payment. An increased use of food banks has been observed, along with debt, rent arrears, and even homelessness.

The latest evidence came from Citizens Advice in July. The charity surveyed 800 people who sought help with universal credit in pilot areas, and found that 39 per cent were waiting more than six weeks to receive their first payment and 57 per cent were having to borrow money to get by during that time.

Our analysis confirms Universal Credit is just not fit for purpose. It looks at different types of households and income groups, all working full time. It shows single parents with dependent children are hit particularly hard, receiving up to £3,100 a year less than they received with tax credits - a massive hit on any family budget.

A single teacher with two children working full time, for example, who is a new claimant to UC will, in real terms, be around £3,700 a year worse off in 2018-19 compared to 2011-12.

Or take a single parent of two who is working in the NHS on full-time average earnings for the public sector, and is a new tax credit claimant. They will be more than £2,000 a year worse off in real-terms in 2018-19 compared to 2011-12. 

Equality analysis published in response to a Freedom of Information request also revealed that predicted cuts to Universal Credit work allowances introduced in 2016 would fall most heavily on women and ethnic minorities. And yet the government still went ahead with them.

It is shocking that most people on low and middle incomes are no better off than they were five years ago, and in some cases they are worse off. The government’s cuts to in-work support of both tax credits and Universal Credit are having a dramatic, long lasting effect on people’s lives, on top of stagnating wages and rising prices. 

It’s no wonder we are seeing record levels of in-work poverty. This now stands at a shocking 7.4 million people.

Our analyses make clear that the government’s abject failure on living standards will get dramatically worse if UC is rolled out in its current form.

This exactly why I am calling for the roll out to be stopped while urgent reform and redesign of UC is undertaken. In its current form UC is not fit for purpose. We need to ensure that work always pays and that hardworking families are properly supported. 

Labour will transform and redesign UC, ending six-week delays in payment, and creating a fair society for the many, not the few. 

Debbie Abrahams is shadow work and pensions secretary.