The Tories are hurting, not helping the working class

Behind the government's rhetoric, things aren't getting better for working people. They’re getting much, much worse.

I normally enjoy a good Fraser Nelson column. But last Friday’s, which argued the Tories are the party for working people, was frankly delusional. I thought it was a spoof. Reading it, I wish Mr Nelson had been out on the doorstep with me and Labour’s Victora Groulef in Reading East on Thursday.

After an excellent afternoon knocking on doors, we came to the last house in the street and met a lady who summed up the Tories’ problem. She was a teaching assistant and her husband ran a small building firm. She had never voted Labour before, but now she was all ears. She was profoundly disillusioned with David Cameron. Her husband’s building business had taken a hammering and the banks were proving a nightmare. And she was tired of reading about government attacks on teaching assistants like her who she knows make a huge difference to her school’s ability to personalise education for youngsters and transform standards.

Our friend’s story captured the truth that the Tories are now profoundly hurting, not helping Britain’s working classes. It didn’t get a lot of comment, but last week we saw figures showing that in the first full year of this government, inequality has begun to spiral up – and this before the new bank bonus round Ed Miliband raised in the Commons, or this year’s huge cuts to tax credits, or this year’s whopping tax cut for Britain’s richest citizens. The reality is Britain’s aspirational classes have been left high and dry by the Tories. 

Let’s start with the engine room of aspirational Britain: our small business community. I’ve started a small business. I know what a roller coaster it is. And I know just how critical a friendly bank can be. Small business is the key to reducing unemployment. In fact, as Labour’s Toby Perkins recently pointed out, 90 per cent of people moving from unemployment into private sector employment do so with small businesses. But right now, the government’s comprehensive failure to tackle the bank lending crisis is suffocating enterprise. Business lending has fallen in every quarter of the last two years not least because our banking sector is so uncompetitive; 89 per cent of all our businesses are locked into the five big banks. That’s why Ed Miliband and Chuka Umunna launched the report of our small business taskforce with a commitment to introduce a new system of regional banks - banks that only lend to businesses within a defined community - to support small business, modelled on Germany’s successful Sparkassen.

Or let’s take education. Alan Milburn, the government’s social mobility tsar, last week published figures revealing the shockingly low levels of state school students admitted by Russell Group universities. The head of Ofsted, Sir Michael Wilshaw, has attacked the reality that "unseen" pupils from poor backgrounds are being let down. The clock is going backwards.

Yet for all his bluster, Michael Gove is focusing his attention elsewhere. He is presiding over a system that is radically centralising and radically fragmenting our school system. That’s why we need a very different kind of reform. As Stephen Twigg argued last week, the success of the schools in Shanghai shows strong oversight at local level is vital to sharing best practice. And as Andreas Schleicher of the OECD has pointed out, there is a strong correlation between collaborative culture and system success. Sir Michael Wilshaw made much the same point, signalling strong support for the plan set out by Stephen last Monday.

Stephen made a powerful case: wherever school freedom promotes higher standards we will extend those freedoms to all schools. We must make sure "no school is left behind." A school should not have to change its status to earn the permission to innovate. There needs to be stronger oversight of local standards – and a proper effort to foster collaboration. That adds up to a radical devolution of power, rather than the centralisation now underway in Whitehall. And to this we have to add radical change to the curriculum with a technical baccalaureate to provide a bridge from school to high-quality apprenticeships and into work for the 50 per cent of our children who don’t chose to go to university.

Or let’s take welfare reform. The challenge for welfare reformers is not whether you can dream a dream. It’s whether you can deliver. For all their tough talk about "welfare reform", the reality is that the benefits bill is rising by £20bn more than planned because David Cameron is doing nothing to address the long-term drivers of social security spending. And right now the welfare revolution we were promised is simply falling apart.

Just last Thursday, we heard stories that the National Audit Office is profoundly troubled by the state of Universal Credit. There are supposed to be a million people on the system in 10 months' time. But right now, the virtues of Universal Credit are enjoyed by just a few people in Tameside. Or take the work programme. Nice idea in theory. Failing in practice. The latest figures show nearly a million people have flowed though the programme and not even started a job, never mind kept one. Worse, for those in their 50s, who have paid a fortune in National Insurance, there is no additional support available when they become unemployed. They’re lumped in with everyone else. Result? Long-term unemployment is higher among those who have paid in the most. That isn’t fair.

Labour is proposing a radical alternative. A 'triple lock' on welfare spending with an overall cap on the budget, a household benefit cap and a limit of two years to the time you can spend on the dole. But we’ll back this with a jobs guarantee that will channel investment into support for private sector jobs for young people and the long-term unemployed. Labour councils all over Britain are trialling the idea and it’s proving an incredible success. And we’ll move to put the something for something back into social security with extra help to find work for those who’ve cared for others or paid in for a lifetime.

Last year, Norman Tebbit attacked the government’s "abiding sin" of simply seeming "unable to manage its affairs competently". A year on, things aren't getting better for working people. They’re getting much, much worse. I fear Mr Nelson has fallen for the oldest con trick in politics: the rhetoric-reality gap. He might like the government’s rhetoric, but the reality is it's now Labour which has the plan to be realistic with money – but radical with reform. 

Michael Gove speaks at last year's Conservative conference in Birmingham. Photograph: Getty Images.

Liam Byrne is Labour MP for Birmingham Hodge Hill, and sits on the International Trade select committee. He is the cofounder of the UK-China Young Leaders Roundtable and author of Turning to Face the East: How Britain Prospers in the Asian Century.

Photo: Getty
Show Hide image

PMQs review: Jeremy Corbyn prompts Tory outrage as he blames Grenfell Tower fire on austerity

To Conservative cries of "shame on you!", the Labour leader warned that "we all pay a price in public safety" for spending cuts.

A fortnight after the Grenfell Tower fire erupted, the tragedy continues to cast a shadow over British politics. Rather than probing Theresa May on the DUP deal, Jeremy Corbyn asked a series of forensic questions on the incident, in which at least 79 people are confirmed to have died.

In the first PMQs of the new parliament, May revealed that the number of buildings that had failed fire safety tests had risen to 120 (a 100 per cent failure rate) and that the cladding used on Grenfell Tower was "non-compliant" with building regulations (Corbyn had asked whether it was "legal").

After several factual questions, the Labour leader rose to his political argument. To cries of "shame on you!" from Tory MPs, he warned that local authority cuts of 40 per cent meant "we all pay a price in public safety". Corbyn added: “What the tragedy of Grenfell Tower has exposed is the disastrous effects of austerity. The disregard for working-class communities, the terrible consequences of deregulation and cutting corners." Corbyn noted that 11,000 firefighters had been cut and that the public sector pay cap (which Labour has tabled a Queen's Speech amendment against) was hindering recruitment. "This disaster must be a wake-up call," he concluded.

But May, who fared better than many expected, had a ready retort. "The cladding of tower blocks did not start under this government, it did not start under the previous coalition governments, the cladding of tower blocks began under the Blair government," she said. “In 2005 it was a Labour government that introduced the regulatory reform fire safety order which changed the requirements to inspect a building on fire safety from the local fire authority to a 'responsible person'." In this regard, however, Corbyn's lack of frontbench experience is a virtue – no action by the last Labour government can be pinned on him. 

Whether or not the Conservatives accept the link between Grenfell and austerity, their reluctance to defend continued cuts shows an awareness of how politically vulnerable they have become (No10 has announced that the public sector pay cap is under review).

Though Tory MP Philip Davies accused May of having an "aversion" to policies "that might be popular with the public" (he demanded the abolition of the 0.7 per cent foreign aid target), there was little dissent from the backbenches – reflecting the new consensus that the Prime Minister is safe (in the absence of an attractive alternative).

And May, whose jokes sometimes fall painfully flat, was able to accuse Corbyn of saying "one thing to the many and another thing to the few" in reference to his alleged Trident comments to Glastonbury festival founder Michael Eavis. But the Labour leader, no longer looking fearfully over his shoulder, displayed his increased authority today. Though the Conservatives may jeer him, the lingering fear in Tory minds is that they and the country are on divergent paths. 

George Eaton is political editor of the New Statesman.

0800 7318496