Without childcare support, low-paid workers will lose out under Universal Credit

The decision to only provide help with childcare costs to those paying income tax means work will not pay for 900,000 families.

As the first pathfinder for the new Universal Credit system began in April, David Cameron tweeted: "Another major step forward on welfare reform today with the introduction of Universal Credit – this Govt is determined to make work pay".

But this goal risks being undermined by the high cost of childcare in the UK. For some families this is the difference between work paying and paying to work. New research published by the Joseph Rowntree Foundation shows that when the cost of childcare is factored in, for some parents in low-paid jobs it no longer pays to work full-time, while for others the incentive to work more hours is blunted significantly.

Take for example a couple with two young children, where the father is already working full-time on the minimum wage. If the mother takes up a minimum wage job of one and a half days a week, the family would be £23 a week better off. If she increased her hours to three days a week, they would only be £8 a week better off than when worked half the hours. And if she worked full-time the family would actually be worse off than when she worked fewer hours. In this scenario, the family’s disposable income does not increase significantly for three reasons.

First, the amount of Universal Credit received by the family is sharply withdrawn as the mothers earnings increase; second, by working more than 30 hours she is brought into income tax; and third, the more hours she works the more childcare the family needs. The cost of childcare has risen at twice the rate of inflation over the last five years, while at the same time the help with childcare costs offered to low income working families through the welfare system has been sharply reduced by this government.

But there is some relief on the horizon. In the 2013 Budget, the government announced something of a reversal, proposing to provide more help with childcare costs to working families receiving Universal Credit. But – and it’s a big but – to be eligible all adults in the household would have to be paying income tax. This would exclude those households where someone is working part-time earning the minimum wage. Looking at the working patterns of low income households at present, this policy would deliver a welcome boost to some 600,000 working families on low incomes – but 900,000 in low paid work would miss out.

The government has said it will publish a consultation on its childcare plans before parliament breaks up for its summer recess (next week). To ensure Universal Credit delivers on its goal of making sure it always pays to work, the policy needs to include something for those families that are working hard and 'doing the right thing' but not yet earning enough to pay tax. Otherwise a large number of families will remain trapped in a situation where it barely pays to work.

Katie Schmuecker is policy and research manager at the Joseph Rowntree Foundation

David Cameron during a visit to a London Early Years Foundation nursery on January 11, 2010 in London. Photograph: Getty Images.
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The UK press’s timid reaction to Brexit is in marked contrast to the satire unleashed on Trump

For the BBC, it seems, to question leaving the EU is to be unpatriotic.

Faced with arguably their biggest political-cum-constitutional ­crisis in half a century, the press on either side of the pond has reacted very differently. Confronting a president who, unlike many predecessors, does not merely covertly dislike the press but rages against its supposed mendacity as a purveyor of “fake news”, the fourth estate in the US has had a pretty successful first 150-odd days of the Trump era. The Washington Post has recovered its Watergate mojo – the bloodhound tenacity that brought down Richard Nixon. The Post’s investigations into links between the Kremlin and Donald Trump’s associates and appointees have yielded the scalp of the former security adviser Michael Flynn and led to Attorney General Jeff Sessions recusing himself from all inquiries into Trump-Russia contacts. Few imagine the story will end there.

Meanwhile, the New York Times has cast off its image as “the grey lady” and come out in sharper colours. Commenting on the James Comey memo in an editorial, the Times raised the possibility that Trump was trying to “obstruct justice”, and called on Washington lawmakers to “uphold the constitution”. Trump’s denunciations of the Times as “failing” have acted as commercial “rocket fuel” for the paper, according to its CEO, Mark Thompson: it gained an “astonishing” 308,000 net digital news subscriptions in the first quarter of 2017.

US-based broadcast organisations such as CNN and ABC, once considered slick or bland, have reacted to Trump’s bullying in forthright style. Political satire is thriving, led by Saturday Night Live, with its devastating impersonations of the president by Alec Baldwin and of his press secretary Sean Spicer by the brilliant Melissa McCarthy.

British press reaction to Brexit – an epic constitutional, political and economic mess-up that probably includes a mind-bogglingly destructive self-ejection from a single market and customs union that took decades to construct, a move pushed through by a far-right faction of the Tory party – has been much more muted. The situation is complicated by the cheerleading for Brexit by most of the British tabloids and the Daily Telegraph. There are stirrings of resistance, but even after an election in which Theresa May spectacularly failed to secure a mandate for her hard Brexit, there is a sense, though the criticism of her has been intense, of the media pussy-footing around a government in disarray – not properly interrogating those who still seem to promise that, in relation to Europe, we can have our cake and eat it.

This is especially the case with the BBC, a state broadcaster that proudly proclaims its independence from the government of the day, protected by the famous “arm’s-length” principle. In the case of Brexit, the BBC invoked its concept of “balance” to give equal airtime and weight to Leavers and Remainers. Fair enough, you might say, but according to the economist Simon Wren-Lewis, it ignored a “near-unanimous view among economists that Brexit would hurt the UK economy in the longer term”.

A similar view of “balance” in the past led the BBC to equate views of ­non-scientific climate contrarians, often linked to the fossil-fuel lobby, with those of leading climate scientists. Many BBC Remainer insiders still feel incensed by what they regard as BBC betrayal over Brexit. Although the referendum of 23 June 2016 said nothing about leaving the single market or the customs union, the Today presenter Justin Webb, in a recent interview with Stuart Rose, put it like this: “Staying in the single market, staying in the customs union – [Leave voters would say] you might as well not be leaving. That fundamental position is a matter of democracy.” For the BBC, it seems, to question Brexit is somehow to be unpatriotic.

You might think that an independent, pro-democratic press would question the attempted use of the arcane and archaic “royal prerogative” to enable the ­bypassing of parliament when it came to triggering Article 50, signalling the UK’s departure from the EU. But when the campaigner Gina Miller’s challenge to the government was upheld by the high court, the three ruling judges were attacked on the front page of the Daily Mail as “enemies of the people”. Thomas Jefferson wrote that he would rather have “newspapers without a government” than “a government without newspapers”. It’s a fair guess he wasn’t thinking of newspapers that would brand the judiciary as “enemies of the people”.

It does seem significant that the United States has a written constitution, encapsulating the separation and balance of powers, and explicitly designed by the Founding Fathers to protect the young republic against tyranny. When James Madison drafted the First Amendment he was clear that freedom of the press should be guaranteed to a much higher degree in the republic than it had been in the colonising power, where for centuries, after all, British monarchs and prime ministers have had no qualms about censoring an unruly media.

By contrast, the United Kingdom remains a hybrid of monarchy and democracy, with no explicit protection of press freedom other than the one provided by the common law. The national impulse to bend the knee before the sovereign, to obey and not question authority, remains strangely powerful in Britain, the land of Henry VIII as well as of George Orwell. That the United Kingdom has slipped 11 places in the World Press Freedom Index in the past four years, down to 40th, has rightly occasioned outrage. Yet, even more awkwardly, the United States is three places lower still, at 43rd. Freedom of the press may not be doing quite as well as we imagine in either country.

Harry Eyres is the author of Horace and Me: Life Lessons from an Ancient Poet (2013)

This article first appeared in the 20 July 2017 issue of the New Statesman, The new world disorder