Why Labour must defend universal benefits for pensioners

The party should remember that benefits for the poor end up being poor benefits.

One of the suggestions that Tony Blair makes in his piece for the centenary edition of the New Statesman (180 pages, out today) is that Labour should look again at "the right balance between universal and means-tested help for pensioners". It's an argument that's made with increasing frequency as the coalition's welfare cuts bite. While dramatically reducing support for working-age claimants, Cameron has "triple-locked" the state pension (so that it increases each year by average earnings, the rate of inflation or 2.5%, whichever is highest) and protected universal benefits for the elderly such as the Winter Fuel Allowance, free TV licences and free bus passes.

With pensioners accounting for 42.3% of all welfare spending (a total that will continue to rise with an ageing population), an ever greater number of politicians and commentators argue that this settlement is unsustainable. Nick Clegg has called for pensioners' benefits to be means-tested, while Iain Duncan Smith has hinted that he believes David Cameron should not repeat his 2010 election pledge to protect them. As Labour seeks to win credibility on welfare and deficit reduction, Ed Miliband is being urged to abandon his long-standing support for universalism and announce that he would restricit benefits if he becomes prime minister. 

It is right to highlight Cameron's cynicism in protecting pensioner benefits. As the decision to means-test child benefit shows, the Prime Minister has little regard for the principle of universalism. The move was motivated by raw political calculation: pensioners are more likely to vote than any other group (76 per cent did in 2010, compared to 65 per cent of the population at large) and are notoriously vigorous in defending their interests. But there are strong principled and practical reasons why Labour should be wary of joining the coming war against universal benefits.

A new system of means-testing would be complex and expensive to administer, while affecting only a fraction of pensioners. Of the UK's 11 million over-65s, two million live in poverty and another six and half a million have an income below £10,500. Just 200,000 earn enough to pay the 40p rate of tax, meaning that any savings would be largely symbolic. Clegg complains that "we are giving free bus passes and TV licences and winter fuel payments to Alan Sugar", while forgetting how rare the likes of Sur Alan are.

The government currently spends £2.2bn a year on winter fuel payments, £1bn on free bus passes and £600m on free TV licences. Compare that to the £23.8bn annually spent on housing benefit (owing to extortionate rents and substandard wages) and the £27.2bn spent on tax credits (owing to inadequate pay) and it becomes clear where the real savings are to be made. It makes little sense to target benefits for cuts when £70bn a year is still lost to tax evasion, £25bn to tax avoidance and the highest earners (including some of those dreaded "millionaire pensioners") have just received a £1bn income tax cut. By insisting that the welfare state (or at least part of it) should bear the brunt of austerity, the left is playing Osborne's game. 

The great practical advantage of universal benefits is that they ensures support goes to those who need it. At present, 1.8 million elderly people eligible for the means-tested pension credit do not claim it due to the complexity and invasiveness of the application process. In the case of the winter fuel payment, restricting the benefit would risk an increase in the 25,000 pensioners who die every year as a result of cold-related illnesses. 

The left most of all, should be wary of abandoning the principle of universalism. History shows that a narrower welfare state soon becomes a shallower one as the politically powerful middle classes lose any stake in the system and the poor are stigmatised as "dependent". The "paradox of redistribution", as social scientists call it, is that provision for some depends on provision for all. A Fabian Society study of 11 OECD countries found that greater means-testing led to increased levels of poverty as the value of benefits progressively withered. In the UK, we are already witnessing this phenomenon at work. While removing child benefit from higher-earners (a measure defended by Beveridge’s ostensible heirs, the Liberal Democrats), the coalition has simultaneously frozen it in cash terms for three years, a real-terms reduction of £1,080 for a family with two children. As Richard Titmuss observed more than forty years ago, "services for the poor end up being poor services". 

The logic of means-testing is remorseless. Remove winter fuel payments and free bus passes from well-off pensioners and the right will next ask why they should not be charged to use the NHS. Fortunately, as a principled social democrat, Ed Miliband has long recognised such arguments. Challenged over his support for universal pensioner benefits on The Andrew Marr Show in January, he replied: 

Look, if you’re saying to me we should make everything in our society means tested - in other words it shouldn’t be universal - that would include child benefit, the health service, the old age pension. Well that isn’t the road I want to go down. Why is that? Because I think everybody as part of the foundation of being a citizen of the country is entitled to some basic things, including on the basis of having children, needing free healthcare.
But as Labour's policy review continues, pressure will grow on Miliband to reverse his stance in order to prove that the party is "tough" on the deficit and welfare spending. He should resist such short-term maneouvres. The principle of universalism is too valuable to be traded in a foolhardy (and likely doomed) attempt to appease the austerity lobby. 
Tony Blair with Ed Miliband during a service to mark the Queen's Diamond Jubilee at Westminster Hall on March 20, 2012. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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Meet Anne Marie Waters - the Ukip politician too extreme for Nigel Farage

In January 2016, Waters launched Pegida UK with former EDL frontman Steven Yaxley-Lennon (aka Tommy Robinson). 

There are few people in British political life who can be attacked from the left by Nigel Farage. Yet that is where Anne Marie Waters has found herself. And by the end of September she could well be the new leader of Ukip, a party almost synonymous with its beer-swilling, chain-smoking former leader.

Waters’s political journey is a curious one. She started out on the political left, but like Oswald Mosley before her, has since veered dramatically to the right. That, however, is where the similarities end. Waters is Irish, agnostic, a lesbian and a self-proclaimed feminist.

But it is her politics – rather than who she is – that have caused a stir among Ukip’s old guard. Former leader Paul Nuttall has said that her views make him “uncomfortable” while Farage has claimed Ukip is “finished” if, under her leadership, it becomes an anti-Islam party.

In her rhetoric, Waters echoes groups such as the English Defence League (EDL) and Britain First. She has called Islam “evil” and her leadership manifesto claims that the religion has turned Britain into a “fearful and censorious society”. Waters wants the banning of the burqa, the closure of all sharia councils and a temporary freeze on all immigration.

She started life in Dublin before moving to Germany in her teens to work as an au pair. Waters also lived in the Netherlands before returning to Britain to study journalism at Nottingham Trent University, graduating in 2003. She subsequently gained a second degree in law. It was then, she says, that she first learnt about Islam, which she claims treats women “like absolute dirt”. Now 39, Waters is a full-time campaigner who lives in Essex with her two dogs and her partner who is an accountant.

Waters’s first spell of serious activism was with the campaign group One Law for All, a secularist organisation fronted by the Iranian feminist and human rights activist Maryam Namazie. Waters resigned in November 2013 after four years with the organisation. According to Namazie, Waters left due to political disagreements over whether the group should collaborate with members of far-right groups.

In April 2014, Waters founded Sharia Watch UK and, in January 2016, she launched Pegida UK with former EDL frontman Steven Yaxley-Lennon (aka Tommy Robinson). The group was established as a British chapter of the German-based organisation and was set up to counter what it called the “Islamisation of our countries”. By the summer of 2016, it had petered out.

Waters twice stood unsuccessfully to become a Labour parliamentary candidate. Today, she says she could not back Labour due to its “betrayal of women” and “betrayal of the country” over Islam. After joining Ukip in 2014, she first ran for political office in the Lambeth council election, where she finished in ninth place. At the 2015 general election, Waters stood as the party’s candidate in Lewisham East, finishing third with 9.1 per cent of the vote. She was chosen to stand again in the 2016 London Assembly elections but was deselected after her role in Pegida UK became public. Waters was also prevented from standing in Lewisham East at the 2017 general election after Ukip’s then-leader Nuttall publicly intervened.

The current favourite of the 11 candidates standing to succeed Nuttall is deputy leader Peter Whittle, with Waters in second. Some had hoped the party’s top brass would ban her from standing but last week its national executive approved her campaign.

Due to an expected low turnout, the leadership contest is unpredictable. Last November, Nuttall was elected with just 9,622 votes. More than 1,000 new members reportedly joined Ukip in a two-week period earlier this year, prompting fears of far-right entryism.

Mike Hookem MEP has resigned as Ukip’s deputy whip over Waters’ candidacy, saying he would not “turn a blind eye” to extremism. By contrast, chief whip, MEP Stuart Agnew, is a supporter and has likened her to Joan of Arc. Waters is also working closely on her campaign with Jack Buckby, a former BNP activist and one of the few candidates to run against Labour in the by-election for Jo Cox’s former seat of Batley and Spen. Robinson is another backer.

Peculiarly for someone running to be the leader of a party, Waters does not appear to relish public attention. “I’m not a limelight person,” she recently told the Times. “I don’t like being phoned all the time.”

The journalist Jamie Bartlett, who was invited to the initial launch of Pegida UK in Luton in 2015, said of Waters: “She failed to remember the date of the demo. Her head lolled, her words were slurred, and she appeared to almost fall asleep while Tommy [Robinson] was speaking. After 10 minutes it all ground to an uneasy halt.”

In an age when authenticity is everything, it would be a mistake to underestimate yet another unconventional politician. But perhaps British Muslims shouldn’t panic about Anne Marie Waters just yet.

James Bloodworth is editor of Left Foot Forward

This article first appeared in the 17 August 2017 issue of the New Statesman, Trump goes nuclear