How Labour can offer something for something on welfare

A two-tier system of benefits for job seekers, with higher entitlements for those with strong work records, could be funded by reducing spending on mortgage interest.

This is set to be a big week for Labour. Today Ed Balls launched a foray into pensioner benefits, later this week Ed Miliband is set to address the question of working age welfare. The question is what principle (or combination of principles) should underpin any new approach. The shadow chancellor’s announcement today points towards more means-testing but in January, Miliband defended universal benefits and since then Liam Byrne has promised that Labour would "strengthen the old principle of contribution". 

Means-testing and the contributory principle are, of course, uneasy bedfellows; one judges eligibility by what people need to take out of a system, the other by what people have put in. Labour should plump for more emphasis on the latter. This matters most for working age welfare, which has been haemorrhaging support in recent years. International evidence shows that the UK has one of the least generous welfare systems for the unemployed –and one of those with the weakest relationship between what people have paid in and what they get out. The two are linked: people tend to support systems with a stronger contributory element.

In a paper published today Demos argues that the government should create a two-tier system of benefits for job seekers, with higher entitlements for those with strong work records. This would end the ‘nothing for something’ system, in which many people contribute over a number of years, only to find themselves entitled to very little when they require help. This would be paid for by reducing spending on the Support for Mortgage Interest (SMI) scheme, which currently covers the interest on up to £200,000 of loans or mortgages for homeowners out of work, up to a maximum of two years.

The principle behind this is that if people make the choice to take on a mortgage, they should also insure themselves against the associated risks. Homeowners losing their entitlement to SMI would instead be auto-enrolled into mortgage payment protection insurance, leaving them to choose to not cover themselves or to purchase insurance for mortgage interest payments at a cost of £33 a month at most - less than the price of an average mobile phone bill. The money saved from this change would allow for a higher payments for those with strong work records – roughly £95 a week compared to the £71.70 that all job seekers currently get for at least six months.

These changes would promote personal responsibility, through homeowners insuring themselves against risk incurred by their own choices. They would engender reciprocity, through a system which rewarding contribution. And they would avoid increasing the deficit by reallocating existing spending, rather than adding new commitments. 

Duncan O'Leary is deputy director of Demos

A street cleaner passes the Jobcentre Plus office on January 18, 2012 in Bath, England. Photograph: Getty Images.

Duncan O’Leary is deputy director of Demos

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Why Prince Charles and Princess Anne are both wrong on GM foods

The latest tiff between toffs gives plenty of food for thought.

I don’t have siblings, so I was weirdly curious as a kid about friends who did, especially when they argued (which was often). One thing I noticed was the importance of superlatives: of being the best child, the most right, and the first to have been wronged. And it turns out things are no different for the Royals.

You might think selective breeding would be a subject on which Prince Charles and Princess Anne would share common ground, but when it comes to genetically modified crops they have very different opinions.

According to Princess Anne, the UK should ditch its concerns about GM and give the technology the green light. In an interview to be broadcast on Radio 4’s Farming Today, she said would be keen to raise both modified crops and livestock on her own land.

“Most of us would argue we have been genetically modifying food since man started to be agrarian,” she said (rallying the old first-is-best argument to her cause). She also argued that the practice can help reduce the price of our food and improve the lives of animals - and “suspects” that there are not many downsides.

Unfortunately for Princess Anne, her Royal “us” does not include her brother Charles, who thinks that GM is The Worst.

In 2008, he warned that genetically engineered food “will be guaranteed to cause the biggest disaster environmentally of all time.”  Supporting such a path would risk handing control of our food-chain to giant corporations, he warned -  leading to “absolute disaster” and “unmentionable awfulness” and “the absolute destruction of everything”.

Normally such a spat could be written off as a toff-tiff. But with Brexit looming, a change to our present ban on growing GM crops commercially looks ever more likely.

In this light, the need to swap rhetoric for reason is urgent. And the most useful anti-GM argument might instead be that offered by the United Nations’ cold, hard data on crop yields.

Analysis by the New York Times shows that, in comparison to Europe, the United States and Canada have “gained no discernible advantages” from their use of GM (in terms of food per acre). Not only this, but herbicide use in the US has increased rather than fallen.

In sum: let's swap superlatives and speculation for sense.

India Bourke is an environment writer and editorial assistant at the New Statesman.