Iain Duncan Smith. Photo: Oli Scarff/Getty Images
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Welfare reform: proof that you can get away with failure if it's boring and it doesn't affect People Like Us

Don't believe the hype about the rollout of universal credit and how the Tories are finally "making work pay" - Iain Duncan Smith has presided over perhaps the failure of this parliament.

Whenever I talk about the need for better representation of women and minorities in politics, there is a stock response. “Surely we want ministers appointed on merit?” people ask, making a serious face. And I always think, “So how do you explain Iain Duncan Smith, then?”

IDS is one of the great enigmas of modern politics. In person, he appears quiet, self-contained, borderline pious: stick him in a robe and sandals and he’d make a very good abbot. He has devoted allies who believe in him with quasi-religious zeal.

Yet welfare reform is perhaps the failure of this parliament, which has been allowed to go unnoticed because: a) it doesn’t really affect People Like Us and b) it is protected by a tedium shield three miles thick.

These past weeks, the spin doctors tell us, were devoted to trumpeting the Conservatives’ alleged success in saving the taxpayer sackloads of cash by chastising scroungers and layabouts into honest employment. Tory commentators are in ecstasies. “Like an unstoppable cyborg programmed with bourgeois decency – the Suburbinator – IDS has simply refused to give in,” swooned Matthew d’Ancona in the Guardian on 15 February. “His welfare revolution is potentially the most important achievement of the government,” wrote Peter Oborne in the same day’s Telegraph. (If only we could get all jobseekers to work as hard as the word “potentially” does in that sentence. I am potentially the most acclaimed supermodel of the 21st century. Tony Blair is potentially the man who will bring peace to the Middle East. Don’t all rush to Ladbrokes at once.)

Let’s start with Universal Credit, since that has apparently now been recast as a success. It is actually a failure: a good idea in theory that was horrifically bungled in practice. In 2010 the government quite reasonably acknowledged that navigating a maze of more than 30 benefits was causing huge problems for claimants. But ministers seemed less aware that the complexity would not go away under Universal Credit; it would merely be dealt with by a computer system instead.

There is a reason why “government IT project” rivals “rail replacement bus” as the most chilling three-word phrase in our language. This didn’t bother Duncan Smith and his circle at the Department for Work and Pensions, who were infused with a sense of divine purpose. Throughout the process, the department has made avoidable errors by insisting that all naysayers must be enemies rather than critical friends. In September 2013, a National Audit Office report raised alarms about “a ‘fortress’ mentality within the programme team and a ‘good news’ reporting culture”. The public accounts committee, led by the indomitable Margaret Hodge, reported in November that year that the team was “isolated and defensive” and “gave misleading interviews to the press” indicating that all was well. There were also some sharp questions about how well the £425m invested up to that point had been spent.

The problems are not confined to the distant past. In December, the Office for Budget Responsibility delivered an exquisitely crafted blow, saying, in effect, that it didn’t believe the department’s figures any longer. It cited “the recent history of optimism bias in Universal Credit plans and other projects of this sort”.

That optimism bias was still on show on 15 February as IDS announced the roll-out of Universal Credit. It might happen, although Labour says it will “pause” the programme if elected and George Osborne (who seems never to have rated his colleague’s intelligence or ability) may well find a way to kibosh it out of the spotlight of an election campaign. The Treasury has still not approved the business case for Universal Credit and the rollout has a host of exemptions. You cannot claim it if you own your home or are homeless, for example.

Even if it does finally emerge, Universal Credit seems unlikely to deliver the huge savings needed to slash the welfare bill to the levels demanded by Osborne. It might also have unintended consequences that haven’t been sufficiently offset. For instance, the vaunted ambition of “making work pay” – by stopping the steep reduction in benefits for those working just over 16 hours a week – might encourage claimants to take insecure, irregular part-time work and allow employers to get away with offering it.

Universal Credit is not the government’s only troubled welfare reform. The expanded work capability assessment backfired so badly that the outsourced provider ditched the contract. The Jobseeker’s Allowance (JSA) system has become incredibly punitive. Declan Gaffney in the National Insti­tute Economic Review records that JSA sanctions are running at 6 per cent, the highest on record; among Employment and Support Allowance claimants (who are currently not fit for work), sanctions rose from 2,200 in the first quarter of 2012 to 15,900 in the first quarter of 2014. To gain public support for these measures, the government has relied on myths such as “families where no one has worked for three generations” (of which the Joseph Rowntree Foundation failed to find a single example).

The unpalatable truth is that a high benefits bill stems not from a badly structured welfare system but from a badly structured society. Take housing benefit: accounting for inflation, it has risen 150 per cent in the past 21 years. The answer is not to cut housing benefit but to build more homes.

Welfare reform in this parliament has been about running to stand still, huffing and puffing and achieving very little. As Gaffney notes, “Labour’s spending plans for 2014/15 were for £216.8bn, compared with the current forecast of £215bn.” I bet the Quiet Man won't have much to say about that. 

Helen Lewis is deputy editor of the New Statesman. She has presented BBC Radio 4’s Week in Westminster and is a regular panellist on BBC1’s Sunday Politics.

This article first appeared in the 20 February 2015 issue of the New Statesman, Still hanging

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The Tories' aim is to put Labour out of business for good

Rather than merely winning again, the Conservatives are seeking to inflict permanent damage on the opposition. 

The Conservatives are numerically weak but politically strong – that is the peculiarity of their position. Their majority is the smallest of any single-party government since October 1974. Yet, to MPs at the Tory conference in Manchester, it felt like “2001 in reverse”: the year of Tony Blair’s second election victory. Then, as now, the opposition responded to defeat by selecting a leader, Iain Duncan Smith, who was immediately derided as unelectable. Just as Labour knew then that it would win in 2005, so the Conservatives believe that they have been gifted victory in 2020. David Cameron has predicted that the party’s vote share could rise from 37 per cent to a Thatcherite 43 per cent.

For Cameron and George Osborne, who entered parliament in 2001, this moment is revenge for New Labour’s electoral hegemony. They believe that by applying Blair’s lessons better than his internal successors, they can emulate his achievements. The former Labour prime minister once spoke of his party as “the political wing of the British people”. In Manchester, Cameron and Osborne displayed similarly imperial ambitions. They regard Jeremy Corbyn’s election as a chance to realign the political landscape permanently.

Seen from one perspective, the Tories underperformed on 7 May. They consistently led by roughly 20 points on the defining issues of the economy and leadership but defeated Labour by just 6.5 overall. It was their enduring reputation as the party of the plutocracy that produced this disparity. Those who voted for Labour in spite of their doubts about Ed Miliband and the party’s economic competence may not be similarly forgiving of Corbyn. To maximise their gains, however, the Tories need to minimise their weaknesses, rather than merely exploit Labour’s.

This process began at conference. At a dinner organised by the modernising group the Good Right, Duncan Smith, Michael Gove and the Scottish Tory leader, Ruth Davidson, affirmed their belief that, contrary to Thatcherite orthodoxy, inequality is a problem. Only the Business Secretary, Sajid Javid, an admirer of the libertarian heroine Ayn Rand, insisted that equality of opportunity was the defining metric.

George Osborne’s assured speech was most notable for his sustained appeal to Labour voters. Several opposition MPs told me how unsettled they were by the Chancellor’s declaration that Labour’s new leadership calls “anyone who believes in strong national defence, a market economy and the country living within its means” a Tory. He added, “It’s our job to make sure they’re absolutely right. Because we’re now the party of work, the only true party of labour.” The shadow minister Jonathan Reynolds told me: “We’ve got to be extremely clear that this is not business as usual. This is a real attempt by the Tories to put us out of business – possibly for ever.”

The Conservatives’ aim is to contaminate Labour to the point where, even if Jeremy Corbyn were deposed, the toxin would endure. For those opposition MPs who emphasise being a government-in-waiting, rather than a protest movement, the contrast between the high politics of the Tory conference and Corbyn’s rally appearance in Manchester was painfully sharp. They fear guilt by association with the demonstrators who spat at and abused journalists and Tory delegates. The declaration by a rally speaker, Terry Pullinger, the deputy general secretary of the Communication Workers Union, that Corbyn’s election “almost makes you want to celebrate the fact that Labour lost” was regarded as confirmation that some on the left merely desire to run the party, not the country.

But few Tory MPs I spoke to greeted Corbyn’s victory with simple jubilation. “It’s a great shame, what’s happened to Labour,” one said. “We need a credible opposition.” In the absence of this, some fear the Conservatives’ self-destructive tendencies will reassert themselves. The forthcoming EU referendum and leadership contest are rich in cannibalistic potential. Tories spoke forebodingly of the inevitable schism between European Inners and Outers. As the Scottish experience demonstrated, referendums are almost never definitive. In the event of a close result, the party’s anti-EU wing will swiftly identify grounds for a second vote.

Several cabinet ministers, however, spoke of their confidence in Cameron’s ability to navigate the rapids of the referendum and his pre-announced departure. “More than ever, he’s the right man for these times,” one told me. By this December, Cameron will have led his party for ten years, a reign exceeded in recent history only by Stanley Baldwin, Winston Churchill and Margaret Thatcher. That the Conservatives have so far avoided cataclysm is an underappreciated achievement.

Yet there are landmines ahead. An increasing number of MPs fear that the planned cuts to tax credits could be a foul-up comparable to Gordon Brown’s abolition of the 10p tax rate. Despite the appeals of Boris Johnson and the Sun, Cameron and Osborne have signalled that there will be no backtracking. At such moments of reflection, the Tories console themselves with the belief that, although voters may use Corbyn as a receptacle for protest (as they did Michael Foot, Neil Kinnock and Ed Miliband), they will not elect him. They also acknowledge that the current Labour leader may not be their opponent in 2020. The former paratrooper Dan Jarvis is most often cited as the successor they fear. As with Cameron and Blair, his relative lack of ideological definition may prove to be a strength, one MP suggested.

William Hague is fond of joking that the Tories have only two modes: panic and complacency. If the danger before the general election was of the former, the danger now is of the latter. 

George Eaton is political editor of the New Statesman.