George Osborne during a visit to the Royal Mint earlier today in Llantrisant, Wales. Photograph: Getty Images.
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Will George Osborne's welfare cap stand the test of time?

Self-conscious attempts by one government to constrain the hands of their successors rarely work.

George Osborne's welfare cap will be voted on tomorrow. It's viewed by many as a moment of reckoning for Labour in which it will be caught in a deadly trap: support eye-wateringly tight and binding proposals that threaten the future of the welfare state or oppose them and stand exposed as the believers in big welfare spending that their critics allege.

It’s not only supposed to be a tricky tactical test but it’s also billed as a strategically important piece of policy that will make it more likely that any future government will have to back the choices being made by the current one. Which, depending on your political point of view, is why it’s lauded as a "potentially momentous punctuation mark" in Britain’s attachment to overblown welfare spending or a grave threat to what remains of social security. Both friend and foe of the proposal concur that it will cast a long shadow.

Or perhaps not. Leaving the parliamentary theatre to one side, self-conscious attempts by one government to constrain the hands of their successors rarely work. They tend to generate much media and parliamentary excitement at the time but leave relatively little historical mark.

The last Labour government also attempted this via legislation in 2009 that was supposed to enshrine a legal duty on the Secretary of State for Welfare to abolish child poverty by 2020. There were no caveats or get-outs and it paved the way, or so it was thought, for judicial reviews to be mounted against a non-compliant government. There were a panoply of reporting requirements, legal duties and new bodies like the Child Poverty Commission to give life to the ambition.    

Yet the world didn’t really change. Even the tactical challenge didn’t work: the parliamentary vote turned out to be quite useful for the then Conservative opposition (the Labour leadership may end up feeling the same about this week’s vote).  Five years on and it’s safe to say that Ian Duncan Smith doesn't wake up in the morning worrying about the provisions of Labour's law. The 2020 child poverty objectives are going to be missed by a country mile. The legislation didn't lock in anything.

In some respects, this week’s vote is less meaningful. For a start, the coalition’s fiscal mandate, of which the new welfare cap is part, automatically dissolves at the end of this Parliament. It will be replaced by whatever new fiscal arrangements that the government of the day selects.  The opportunities for adjusting the cap are many – this could be done in a low-key way by simply changing the very tight forecast margin that is built into the numbers or more overtly by shifting which benefits fall inside it, or the time period over which it applies.

More fundamentally, any government that wanted to undertake policy changes to cut spending on social security is likely to do so with or without the cap. And if they wanted to let spending rise by more than the cap would permit, they would also be able to do so (and if they can’t win a Commons vote on a budget related issue like this they won’t be in power for long). Nothing about its introduction alters the real choices on the underlying deficit: raise taxes, cut social security or public services by more than is already planned or have a larger deficit for longer.

Which isn’t to say that it is irrelevant. Like many of these devices, the welfare cap is effectively a self-embarrassment tool.  Its real effect is to make it more likely than would have otherwise been the case that higher than expected social security spending will get noticed and be debated. In a climate of widespread welfare-scepticism that could matter.

It’s also the case that if the government of the day wishes to use adherence to the cap as a public justification for making controversial policy measures then the design of it matters. And here it is noteworthy that the proposed cap sits uneasily with Universal Credit, the coalition’s flagship welfare reform that aims to seamlessely integrate a wide range of benefits. Most of these will fall inside the cap (mainly for the in-work) and some outside (mainly for the out of work such as Jobseeker's Allowance and housing benefit for the unemployed).  A rushed effort to bear down on covered areas of welfare spending – if the OBR reports at an Autumn Statement that there is likely to be an overshoot in spending it is supposed to result in policy changes in the following Budget – could change the shape of Universal Credit and very easily undermine work incentives.

There is another sense in which all this should, or at least could, in theory matter. For all the heat in the current welfare debate, there is relatively little light about the underlying causes of the trends in social security expenditure, and far less still on whether alternative policy choices would, or wouldn’t, affect them (a point Graeme Cook also makes). How much difference would a major boost to housing supply, or a steadily rising minimum wage over a Parliament, make to spending on tax credits and benefits? We don’t really know. Because it’s not anyone’s job in government to think hard about the interactions of policy choices and welfare spending, we have only a limited sense of what the real choices and trade-offs are. An improved process of thinking about social security (and other) spending including on costly tax-reliefs could help remedy this.

Amidst the Parliamentary antics this week, we should keep all this in proportion. When the next chapter of the history of the welfare state gets written, this week’s vote is unlikely to have a leading part.

This post originally appeared on the Resolution Foundation website

Gavin Kelly is a former adviser to Downing Street and the Treasury. He tweets @GavinJKelly1.

Photo: Getty
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The government needs more on airports than just Chris Grayling's hunch

This disastrous plan to expand Heathrow will fail, vows Tom Brake. 

I ought to stop being surprised by Theresa May’s decision making. After all, in her short time as Prime Minister she has made a series of terrible decisions. First, we had Chief Buffoon, Boris Johnson appointed as Foreign Secretary to represent the United Kingdom around the world. Then May, announced full steam ahead with the most extreme version of Brexit, causing mass economic uncertainty before we’ve even begun negotiations with the EU. And now we have the announcement that expansion of Heathrow Airport, in the form of a third runway, will go ahead: a colossally expensive, environmentally disastrous, and ill-advised decision.

In the House of Commons on Tuesday, I asked Transport Secretary Chris Grayling why the government is “disregarding widespread hostility and bulldozing through a third runway, which will inflict crippling noise, significant climate change effects, health-damaging air pollution and catastrophic congestion on a million Londoners.” His response was nothing more than “because we don’t believe it’s going to do those things.”

I find this astonishing. It appears that the government is proceeding with a multi-billion pound project with Grayling’s beliefs as evidence. Why does the government believe that a country of our size should focus on one major airport in an already overcrowded South East? Germany has multiple major airports, Spain three, the French, Italians, and Japanese have at least two. And I find it astonishing that the government is paying such little heed to our legal and moral environmental obligations.

One of my first acts as an MP nineteen years ago was to set out the Liberal Democrat opposition to the expansion of Heathrow or any airport in southeast England. The United Kingdom has a huge imbalance between the London and the South East, and the rest of the country. This imbalance is a serious issue which our government must get to work remedying. Unfortunately, the expansion of Heathrow does just the opposite - it further concentrates government spending and private investment on this overcrowded corner of the country.

Transport for London estimates that to make the necessary upgrades to transport links around Heathrow will be £10-£20 billion pounds. Heathrow airport is reportedly willing to pay only £1billion of those costs. Without upgrades to the Tube and rail links, the impact on London’s already clogged roads will be substantial. Any diversion of investment from improving TfL’s wider network to lines serving Heathrow would be catastrophic for the capital. And it will not be welcomed by Londoners who already face a daily ordeal of crowded tubes and traffic-delayed buses. In the unlikely event that the government agrees to fund this shortfall, this would be salt in the wound for the South-West, the North, and other parts of the country already deprived of funding for improved rail and road links.

Increased congestion in the capital will not only raise the collective blood pressure of Londoners, but will have severe detrimental effects on our already dire levels of air pollution. During each of the last ten years, air pollution levels have been breached at multiple sites around Heathrow. While a large proportion of this air pollution is caused by surface transport serving Heathrow, a third more planes arriving and departing adds yet more particulates to the air. Even without expansion, it is imperative that we work out how to clean this toxic air. Barrelling ahead without doing so is irresponsible, doing nothing but harm our planet and shorten the lives of those living in west London.

We need an innovative, forward-looking strategy. We need to make transferring to a train to Cardiff after a flight from Dubai as straightforward and simple as transferring to another flight is now. We need to invest in better rail links so travelling by train to the centre of Glasgow or Edinburgh is quicker than flying. Expanding Heathrow means missing our climate change targets is a certainty; it makes life a misery for those who live around the airport and it diverts precious Government spending from other more worthy projects.

The Prime Minister would be wise to heed her own advice to the 2008 government and “recognise widespread hostility to Heathrow expansion.” The decision to build a third runway at Heathrow is the wrong one and if she refuses to U-turn she will soon discover the true extent of the opposition to these plans.

Tom Brake is the Liberal Democrat MP for Carshalton & Wallington.