Why the Welfare Uprating Bill deserves to be defeated

Osborne's plan to cut benefits will force more of the poorest families to choose between heating and eating.

After weeks of increasingly fractious debate, MPs will vote today on the government’s Welfare Benefits Uprating Bill, which enshrines in law George Osborne’s plan to raise benefits by 1 per cent per year for the next three years, rather than in line with price increases. With the support of almost all Conservative and Liberal Democrat MPs, the bill will easily pass the House of Commons (Labour, to its credit, will vote against it) but here are four reasons why it deserves to be defeated.

1. It will force even more of the poorest families to choose between heating and eating

By raising benefits by 1 per cent, rather than in line with inflation, which stood at 2.2 per cent in September 2012 (the month traditionally used to calculate benefit increases), the coalition will leave the poorest families even more vulnerable to fluctuations in food and energy prices. Inflation is forecast by the Office for Budget Responsibility to be 2.6 per cent in September 2013 and 2.2 per cent in September 2014, meaning that those families affected will have suffered a cumulative loss of four per cent of income by the end of the period. For many, this will mean being forced to choose between heating their home and feeding their family.

As the Institute for Fiscal Studies reported yesterday, 2.5 million households without someone in work will lose an average of £215 per year in 2015-16, while seven million households with someone in work will lose an average of £165 per year. If, as in recent years, inflation rises faster than expected, these losses will be even greater.

2. It will damage the economy by reducing real incomes

When wages are stagnant and unemployment is high, benefit payments automatically increase in order to limit the fall in consumer demand. While government borrowing rises as a result, these "automatic stabilisers" have long been recognised as an essential tool of economic policy. In October 2012, George Osborne remarked: "We have never argued that you stop what economists call the automatic stabilisers operating - the lower tax receipts and extra government payments [such as higher benefits] that follow if, for example, the global economy turns down." Since those on low incomes are forced to spend, rather than save, what little they receive, they automatically stimulate growth.

But Osborne’s decision to cap benefit increases at 1 per cent will reduce the effectiveness of the automatic stabilisers as payments will now fall, rather than rise, in line with inflation, reducing real-terms incomes. As a result, Britain’s anaemic economy will be even more prone to recession.

3. Low wages aren't a reason to cut benefits

In seeking to justify the bill, the Conservatives have repeatedly highlighted the fact that in recent years benefits have risen faster than private sector wages (see their latest poster). Since 2007, the former have increased by an average of 20 per cent (in line with inflation), while the latter have increased by 11.4 per cent.

But this is an argument for increasing wages (for instance, by ensuring greater payment of the living wage), not for cutting benefits. Many of those whose wages have failed to keep pace with inflation rely on in-work benefits such as tax credits to protect their living standards. The government's decision to cut these benefits in real-terms (60 per cent of the real-terms cut falls on working families) will further squeeze their disposable income.

When Iain Duncan Smith says that benefits have risen faster than wages, he is really complaining that wages have risen more slowly than inflation (and are expected to continue to do so until at least 2014). But rather than prompting the government to slash benefits, this grim statistic should encourage it to pursue a genuine growth strategy that ensures more people have access to adequately paid employment.

Finally, while benefits have increased faster than wages in the last five years, this is a temporary quirk caused by the recession. Until now, their value relative to wages has plummeted. In 1979, unemployment benefit was worth 22 per cent of average weekly earnings. Today, it is worth just 15 per cent.

4. There are fairer ways to reduce the deficit

The coalition isn't wrong when it says the deficit, which stood at £121.6bn last year, needs to be reduced (although at a pace commensurate with the state of the economy). But there are fairer ways to raise revenue than cutting benefits for the poorest workers and jobseekers. While reducing welfare payments, the government is simultaneously cutting the top rate of income tax on earnings over £150,000 from 50p to 45p, a measure that will benefit the average income-millionaire by £107,500 a year. Were the government to reverse this measure, it could expect to raise around £3bn a year, more than enough to fund inflation-linked rises in benefits.

Even in the first year of the 50p rate, when temporary forestalling meant many avoided it (for instance, by bringing forward income to 2009-10, the year before the new rate took effect - a trick they could only have played once), the tax raised an extra £1.1bn. This alone is enough to meet the annual cost of increasing benefits in line with inflation (the government expects to save £0.9bn in 2014-15 by capping increases at 1 per cent). But rather than balancing the budget on the backs of the richest (just 1.5 per cent earn more than £150,000), the government has chosen to do so on the backs of the poorest.

George Osborne leaves 11 Downing Street on 7 January 2013 in London. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

A National Trust property. Photo: Getty
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The National Trust is right to bring gay history out of the closet

If you want to explore the history of Britain, you can't ignore its LGBT citizens.

Imagine seeing a monument to executed gay men and thinking literally anything other than, “how sad and poignant”. In September, the National Trust unveiled exactly such a memorial at one of their properties in Dorset. Kingston Lacy was once owned by William John Bankes, a man whose sexuality, in nineteenth century Britain, was a capital offence. The NT’s moving tribute to Lacy and so many others persecuted for being queer was deemed a “PC stunt” by the Daily Mail. Tory MP Andrew Bridgen somehow managed to find the monument “totally inappropriate”, adding that he looks to the Church for moral guidance – not the National Trust.

 But let me backtrack. I’m in the darkened vault of the Tower of London where the Crown Jewels are kept. The tour guide has just made a joke about vibrators.

The last time I was here, I was about nine and I was on a day out with my grandma. She made no mention whatsoever of sex toys. I wonder, actually, if this is the closest to this ceremonial bling a joke about vibrators has ever been made. I also wonder if there’s ever been a tour of the Tower of London where the guide – as my one did about fifteen minutes ago – has quite overtly slammed British imperialism. One thing I know for certain though: this is the first ever official LGBTQ tour of the Tower, organised by none other than Historic Royal Palaces – the charity that manages several of the UK’s grandest former homes.

 Earlier, at Traitors’ Gate, me and a tour group of about twenty people were told about Irish republican Roger Casement, who was executed, here, in 1916. Casement was dedicated to speaking out against the atrocities of imperialism, and was rumoured to be gay. But it wasn’t his alleged homosexuality that landed him in this thousand-year-old fortress-turned-prison, rather his involvement in the Easter Rising. King James I though – I later learn – was almost definitely gay or bi, having a number of “favourite” male courtiers. “Favourite” seeming to be a particularly coy seventeenth century euphemism for “gay lover”.

 The tour lasts about an hour and, although at times it seems to be slightly scraping the barrel for queer content, the pure effort of it is nothing short of heroic. The Crown Jewels section focused in on Queen Victoria, and all the anti-gay legislation introduced during her infamously prudish reign. On this tour, her freakishly tiny crown becomes a symbol of oppression rather than a cutesy royal knick-knack. Which, I can only imagine, would have the “gay agenda”-fearing monarchy groupies of middle England in a Faragean frenzy.

 This year marks the fiftieth anniversary of the 1967 Sexual Offences Act, which partially decriminalised (male) gay sex in England and Wales. And with the sheer number of events, like the queer Tower tour, at palaces and historic institutions – from Hampton Court to the British Library – you’d think it was the Queen’s platinum jubilee.

Now for some word association.

 “National Trust”.

 Pensioners? Fruitcake? Dust? Anarchic genderqueer hook-up joint?

 Not so much that last one? Well then, it may come as a surprise that it was the fusty old National Trust, working alongside the National Archives, that recreated a historically accurate covert 1930s London gay bar. For a couple of nights in March this year, Soho’s Freud Café was transformed into “London’s most bohemian rendezvous”, the Caravan club. In a spectacularly and appropriately theatrical evening of incense, cocktails and vintage drag queens, the NT totally nailed the “illegal den of queer iniquity” thing. This was preceded by a historic LGBTQ tour of Soho, which, like the Tower tour, didn’t gloss over the brutality of the British establishment. The Soho tour was rightfully heavy on harrowing stories about police raids on queer venues. In fact, it was through police reports collected by the National Archives that the NT was able to recreate The Caravan (which was shut down by the police in 1934).

Further north in London, another LGBTQ event hosted by the National Trust was “Sutton House Queered”. If the idea of a Tudor manor house in Hackney isn’t surreal enough, in February the grade II listed former home to aristocracy was the setting of a queer art exhibition. Think – richly wood panelled great room containing a painting of Henry VIII in full bondage gear. This was also the debut of the first gender-neutral public toilet in an NT property.

And, in a display of borderline hilarious inevitability, the Daily Mail … raised objections. “Preserve us from a National Trust that’s so achingly right-on”, quacked a Mail headline in December last year, after the NT announced its plans for a series of “Prejudice and Pride” events marking the 50th anniversary of the Sexual Offences Act. This July, the NT came under attack from the Mail, yet again, for outing late aristocrat, Robert Wyndham Ketton-Cremer. Ketton-Cremer left his Norfolk home to the Trust in 1969, and was supposedly outed as gay in a recent film for the “Prejudice and Pride” series. Whether or not the NT’s decision to discuss Ketton-Cremer’s sexuality was ethical, it’s a refreshing sort of controversy: the kind where an old British institution is actually quite blasé about gay sex, and the Mail goes nuts.

 Throughout this year, my inbox has been almost quite alarmingly full of press releases for queer-related events and promotions. From rainbow hummus (yes.) at the Real Greek restaurant, to “Pride at the Palace” at Hampton Court, more than ever, everyone seems to want a slice of the gay action. The Tate Britain’s “Queer British Art” exhibition, which opened in April, showcases a century (1867—1967) of sexually subversive works by LGBTQ artists. Although overwhelmingly male and posh, it’s hard to play down the importance of such a simultaneously harrowing and celebratory retrospective. In one room, A large and imposing portrait of Oscar Wilde stands right next to the actual door to his prison cell in Reading Gaol, where he was imprisoned for the absolute non-crime of “gross indecency”. Even if Britain’s cultural institutions are just playing up to a trend, a very big part of me is into it.

 In July, I went to a panel discussion organised by Opening Doors London, a charity that provides support for older LGBTQ people. A group of queer people who were adults when the Sexual Offences Act was passed spoke about what this anniversary means to them. When I asked panellist Jane Traies, the author of The Lives of Older Lesbians: Sexuality, Identity & the Life Course, what she thought about the likes of the National Trust taking on queer history, she was understandably wary of the possible faddy-ness of it all.

“It’s good, though, that history itself should come out of the closet,” she said.

                                                                                       

Eleanor Margolis is a freelance journalist, whose "Lez Miserable" column appears weekly on the New Statesman website.