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Osborne doesn’t see that voters can love the idea of benefit cuts but end up hating the cutters

The Chancellor should not assume that there is no political limit to how deep his welfare cuts can go.

It is the noisy, knife-edge votes in parliament that furnish the drama. As a piece of theatre, the vote on 21 November on a statutory instrument filling gaps in the Welfare Reform Act will be a non-event. It is a “deferred division”, a bit of legislative housekeeping that allows MPs to indicate their preferences without debate. Results are published without fanfare.

Yet this shuffling of regulations into law is momentous for hundreds, possibly thousands of families. It finalises the conditions that mean, after April 2013, they could be evicted from their homes. That is when the “benefits cap” comes into force, limiting the amount any household can receive to £500 per week; £350 for childless singles.

The level is set to match the average wage, which is what makes the cap politically effective. The view that work should be more lucrative than inactivity and that state handouts must have a limit is, for most voters, irresistible. The most common public objection is that the cap is too generous.

Few households are technically in receipt of benefits above the capped level – around 20,000, mostly in London. None of them feels it as disposable income. The numbers are inflated by housing benefit (already subject to a separate cap), which has run out of control chasing the capital’s exorbitant rents. Yet outrage at perversities in the current system is greater than attention to the detail of who is affected by coalition policy. That anger has been successfully exploited by Conservatives, painting Labour as the party for handing public money to wastrels.

Passing the mirror test

Defenders of the cap point out that its effects can be avoided by the acquisition of a job. Besides, they ask, why should unemployed families have privileged access to expensive postcodes when low-paid workers have to rent within their means? The argument resonates with anyone weighed down by housing costs.

The problem is that evicted families, most with a few children since the cap makes no allowances for fecundity, will end up being rehoused in areas where there is no guarantee of work or a spare school place. Hundreds could end up homeless. When the costs of dislocation are factored in, the saving for the Exchequer will be nil.

While some of the coalition’s welfare policies might be honourably motivated, the function of this particular change is neither budget consolidation nor reform. It is a gesture of pure political positioning by George Osborne that happens, as a side effect, to turn some of London’s poorest families out of their homes.

So far, it is working. The Tories taunt Labour for their refusal to back the cap. Ed Miliband is torn between honouring his party’s historic obligation to defend the destitute and courting voters for whom welfare iniquities were a reason for deserting Labour in 2010.

The Liberal Democrats have a different dilemma. They want to look fiscally responsible while retaining their self-image as socially conscientious objectors. One party strategist talks about calibrating compromise with the Tories in terms of “passing the mirror test” – can Lib Dems look themselves in the eye believing they have done what they can to mitigate the harshest consequences of austerity?

There are those who think that the benefits cap fails that test. “It exists purely to divide society,” says one prominent Lib Dem. “It is politically motivated and it is immoral.” Many more are reconciled to the cuts they have already backed but squeamish about the next wave. Senior figures in the party query the Conservatives’ capacity to grasp the social implications of benefit-bashing. “On the whole, they have no understanding of the people who are affected by this stuff,” says a Lib Dem cabinet minister.

That mood conditions Nick Clegg’s stance in negotiations over the Autumn Statement on 5 December, when the Chancellor must announce new devices for containing the deficit. The Tories are targeting the benefits bill for billions more in cuts. The Lib Dems accept that welfare spending will face another squeeze but demand tax rises on the rich – specifically a levy on expensive property – to spread the burden of pain.

Underpinning the whole process is Osborne’s strategic judgement that there is no limit to how deep the axe can be planted in welfare entitlements because voters think that they are mostly a scam. It is a view largely supported by opinion polls. Labour strategists concede that hostility to welfare “scroungers” remains fierce. There isn’t even much evidence of solidarity between different categories of benefit claimant.

Blind spot

That doesn’t mean there is no compassion threshold in British society – a line beyond which the public suddenly recoils from the consequences of a policy, regardless of its advertised economic necessity. Fickle voters can demand welfare cuts and still see them as reinforcing the Conservatives’ reputation for heartlessness. “[The Tories] need to be careful,” says one Clegg adviser. “It is entirely possible to do a lot of things that poll favourably and then find that the cumulative effect is to make you very unpopular.”

This is a blind spot for David Cameron and Osborne. They know all about the problems with the Tory brand. They have heard the focus groups and studied the polls. Yet, by definition, they cannot identify with the strain in British culture that instinctively ascribes the worst possible motive to Conservatives. As members of the party, how could they? They can read about a suspicion that Tories ultimately always side with their rich friends and neglect the poor but they cannot inhabit the prejudice in a way that would tune their political antennae to what seems fair to the non-aligned voter.

That makes it a perverse kind of blessing to be in coalition with a party full of people with wariness of Tories in their bones and a strategic plan to monopolise the credit for anything that looks compassionate in the government programme. So when Lib Dems say that a line is being crossed, that welfare cuts are starting to look vindictive and that they must be offset with tax rises for the wealthy, the Prime Minister and the Chancellor might think it a negotiating ploy by political rivals. It is. They should nonetheless seriously consider the possibility that it is also true.

Rafael Behr is political columnist at the Guardian and former political editor of the New Statesman

This article first appeared in the 19 November 2012 issue of the New Statesman, The plot against the BBC

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What's to be done about racial inequality?

David Cameron's words on equal opportunities are to be welcomed - now for some action, says Sunder Katwala.

David Cameron made the strongest, clearest and most high profile statement about ethnic inequalities and the need to tackle discrimination ever yet offered by a British Prime Minister in his leader’s speech to the Conservative Party conference in Manchester.
“Picture this. You’ve graduated with a good degree. You send out your CV far and wide. But you get rejection after rejection. What’s wrong? It’s not the qualifications or the previous experience. It’s just two words at the top: first name, surname. Do you know that in our country today: even if they have exactly the same qualifications, people with white-sounding names are nearly twice as likely to get call backs for jobs than people with ethnic-sounding names? … That, in 21st century Britain, is disgraceful. We can talk all we want about opportunity, but it’s meaningless unless people are really judged equally”, said Cameron.
While the proof of the pudding will be in the eating, this was a powerfully argued Prime Ministerial intervention – and a particularly well-timed one, for three reasons.

Firstly, the Prime Minister was able to root his case in an all-but-universally accepted appeal for equal opportunities. It will always prove more difficult in practice to put political energy and resources behind efforts to remedy discrimination against a minority of the population unless a convincing fairness case is made that values cherished across our whole society are at stake. Cameron’s argument, that any party which tells itself that it is the party of the ‘fair chance’ and ‘the equal shot’ must have a response when there is such clear evidence of discrimination, should prove persuasive to a Conservative Party that has not seen race inequalities as its natural territory. Cameron argued that the same principles should animate responses to discrimination when it comes to race, gender and social class. Put like that, wanting job interviews to be fair – by eradicating conscious and unconscious patterns of bias wherever possible – would strike most Britons as offering as clear a case of the values of fair play as wanting the best baker to win the Great British Bake-Off on television.
Secondly, Cameron’s intervention comes at a potential "tipping point" moment for fair opportunities across ethnic groups. Traditionally, ethnic discrimination has been discussed primarily through the lens of its impact on the most marginalised. Certainly, persistent gaps in the criminal justice system, mental health provision and unemployment rates remain stark for some minority groups. What has been less noticed is the emergence of a much more complex pattern of opportunity and disadvantage – not least as a consequence of significant ethnic minority progress.

Most strikingly of all, in educational outcomes, historic attainment gaps between ethnic minorities and their white British peers have disappeared over the last decade. In the aggregate, ethnic minorities get better GCSE results on average. Ethnic minority Britons are more likely, not less likely, to be university graduates than their fellow citizens. 

As a result of that progress, Cameron’s intervention comes at a moment of significant potential – but significant risk too. Britain’s ethnic minorities are the youngest and fastest-growing sections of British society. If that educational progress translates into economic success, it will make a significant contribution to the "Great British Take-Off" that the Prime Minister envisions. But if that does not happen, with educational convergence combined with current ‘ethnic penalties’ in employment and income persisting, then that potential could well curdle into frustration that the British promise of equal opportunities is not being kept.  Cameron also mirrored his own language in committing himself to both a ‘fight against extremism’ and a ‘fight against discrimination’: while those are distinct challenges and causes, actively pursuing both tracks simultaneously has the potential, at least, depolarise some debates about responses to extremism  - and so to help deepen the broad social coalitions we need for a more cohesive society too.

Thirdly, Cameron’s challenge could mark an important deepening in the political competition between the major parties on race issues. Many have been struck by the increase in political attention on the centre-right to race issues over the last five to ten years. The focus has been on the politics of representation. By increasing the number of non-white Conservative MPs from two to seventeen since 2005, Cameron has sent a powerful signal that Labour’s traditional claim to be ‘the party of ethnic minorities’ would now be contested. Cameron was again able to celebrate in Manchester several ways in which his Cabinet and Parliamentary benches demonstrate many successful journeys of migrant and minority integration in British society. That might perhaps help to ease the fears, about integration being impossible in an era of higher immigration, which the Home Secretary had articulated the previous day.

So symbolism can matter. But facial diversity is not enough. The politics of ethnic minority opportunity needs to be about more than visits to gurdwaras, diversity nights at the party conference fringes and unveiling statues of Mahatma Gandhi in Parliament Square. Jeremy Corbyn’s first speech as Labour leader did include one brief celebratory reference to Britain’s ethnic diversity – “as I travelled the country during the leadership campaign it was wonderful to see the diversity of all the people in our country” – and to Labour bringing in more black, Asian and ethnic minority members - but it did not include any substantial content on discrimination. Tim Farron acknowledged during his leadership campaign that the Liberal Democrats have struggled to get to the starting-line on race and diversity at all. The opposition parties too will no doubt now be challenged to match not just the Prime Minister’s rhetorical commitment to challenging inequalities but also to propose how it could be done in practice.

Non-white Britons expect substance, not just symbolism from all of the parties on race inequalites.  Survation’s large survey of ethnic minority voters for British Future showed the Conservatives winning more ethnic minority support than ever before – but just 29 per cent of non-white respondents were confident that the Conservatives are committed to treating people of every ethnic background equally, while 54 per cent said this of Labour. Respondents were twice as likely to say that the Conservatives needto do more to reach out – and the Prime Minister would seem to be committed to showing that he has got that message.  Moreover, there is evidence that ethnic inclusion could be important in broadening a party’s appeal to other younger, urban and more liberal white voters too – which is why it made sense for this issue to form part of a broader attempt by David Cameron to colonise the broad centre of British politics in his Manchester speech.

But the case for caution is that there has been limited policy attention to ethnic inequalities under the last two governments. Restaurateur Iqbal Wahhab decided to give up his role chairing an ethnic minority taskforce for successive governments, unconvinced there was a political commitment to do much more than convene a talking shop. Lib Dem equalities minister Lynne Featherstone did push the CV discrimination issue – but many Conservatives were sceptical. Cameron’s new commitment may face similar challenges from those whose instinct is to worry that more attention to discrimination or bias in the jobs market will mean more red tape for business.

Labour had a separate race inequalities manifesto in 2015, outside of its main election manifesto, while the Conservative manifesto did not contain significant commitments to racial inequality. The mid-campaign launch in Croydon of a series of race equality pledges showed an increasing awareness of the growing importance of ethnic minority votes - though the fact that they all involved aiming for increases of 20 per cent by 2020 gave them a slightly back-of-the-envelope feel. 

Prime Ministerial commitments have an important agenda-setting function. A generation ago the Stephen Lawrence case opened the eyes of middle England to racist violence and police failures, particularly through the Daily Mail’s persistent challenging of those injustices. A Conservative Prime Minister’s words could similarly make a big difference in the mainstreaming of the issue of inequalities of opportunity. What action should follow words? Between now and next year’s party conference season, that must will now be the test for this Conservative government – and for their political opponents too. 

Sunder Katwala is director of British Future and former general secretary of the Fabian Society.