The twisted logic of making the poor poorer

Ministers seem genuinely to believe that fear and stress are the keys to lifting people out of poverty.

Lord Freud thinks we have a “dreadful welfare system”. No surprise there – the peer has been trying to tinker with, pull apart and generally undermine the benefits system since the partially-implemented 2007 Freud Report – but this time, he’s getting his way with the introduction of Universal Credit. Freud’s answer to the problem of those who don’t have enough is in reach, and it’s a counterintuitive one: what those who already have little need is … even less.

Sound confusing? I’ll let Freud explain in his own words to House magazine: “We have, through our welfare system, created a system which has made [people who are poorer] reluctant to take risks.” Single parents, those with disabilities, the long-term sick – according to Freud, you’ve all just got too comfortable in the “lifestyle” that welfare has afforded you. But lucky for you, Freud’s going to help you hit rock bottom so you can bounce right back up again.

Thanks to Freud’s comments, the incoherence of Universal Credit starts to look like some sort of plan. Over the last few weeks, organisations including the Chartered Institute of Housing and the Joseph Rowntree foundation have issued warnings about what they politely suggest might be the unintended consequences of Universal Credit.

According to the CIH, Universal Credit will leave 400,000 of the UK’s poorest worse off in 2015 than they were in 2010. Families with a weekly household income of £247 will have less; lone parents, whatever their income, lose out.

Meanwhile, the JRF points out that small financial gains will be wiped out by transport and childcare costs under UC, and the withdrawal of benefits such as free school meals and free prescriptions creates a “cliff edge” – incomes will simply drop off once they pass a certain point. And all that assumes the system even works, which seems optimistic given the disaster that accompanied the roll out of Working and Family Tax Credits. With no clear plans for stand-by arrangements in case of failure, the JRF warns that recipients will be forced to start their UC claims in debt.

One might suspect that this financial hammering of those least able to take it is a clerical error, the sort of terrible disaster inflicted by careless meddling in a complex system. But Freud makes it sound as if this is exactly what he planned in the first place. The more stretched your resources, the more Freud sees a moral imperative to thin them down still further until, with nothing left to lose, you might as well risk it all. 

It’s hard to imagine what kind of “risks” Freud imagines a household with less than £247 a week should take. Moving away from established support networks of families, school, friends and social workers to live wherever the council decides you can be cheaply shuffled is one risk. Moving back in with a violent ex because you can’t sustain your children alone? That’s another risk Universal Credit will force people into making. Sofa-surfing, shoplifting, streetwalking: all these are the kind of risks open to a person with nothing to rely on. Risk taking (the positive, speculate-to-accumulate kind that Freud wants you to think of when he says “risk”) is something you do when you have a surplus.

If you have barely enough, of course you live cautiously - not because your luxurious £247 a week has pampered your capitalist instincts into submission, but because if any chunk of that £247 goes to the wrong place or fails to arrive one week, you and your family go under. It’s almost as if Freud doesn’t understand the economics of risk at all; and given that he previously worked in the City, making him an industrial affiliate of those bankers whose desperate miscalculation of risk helped to demolish the world economy, it’s entirely plausible that he really doesn’t.

But there’s at least one person who won’t be risking anything under Universal Credit: Lord Freud. He promises that he’s been listening to feedback, taking advice, keeping himself covered. “I don’t skinny dip, I always have my trunks on,” he promises, summoning a hideous image of him diving into a pool full of benefit claimants and rubbing his Speedo area all over them. You can be certain that many of the worst off will do worse still under Freud’s Universal Credit: they’re the ones being left to take their chances.

The benefits 'lifestyle' is holding people back, says the architect of government welfare reforms. Source: Getty Images

Sarah Ditum is a journalist who writes regularly for the Guardian, New Statesman and others. Her website is here.

Ukip's Nigel Farage and Paul Nuttall. Photo: Getty
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Is the general election 2017 the end of Ukip?

Ukip led the way to Brexit, but now the party is on less than 10 per cent in the polls. 

Ukip could be finished. Ukip has only ever had two MPs, but it held an outside influence on politics: without it, we’d probably never have had the EU referendum. But Brexit has turned Ukip into a single-issue party without an issue. Ukip’s sole remaining MP, Douglas Carswell, left the party in March 2017, and told Sky News’ Adam Boulton that there was “no point” to the party anymore. 

Not everyone in Ukip has given up, though: Nigel Farage told Peston on Sunday that Ukip “will survive”, and current leader Paul Nuttall will be contesting a seat this year. But Ukip is standing in fewer constituencies than last time thanks to a shortage of both money and people. Who benefits if Ukip is finished? It’s likely to be the Tories. 

Is Ukip finished? 

What are Ukip's poll ratings?

Ukip’s poll ratings peaked in June 2016 at 16 per cent. Since the leave campaign’s success, that has steadily declined so that Ukip is going into the 2017 general election on 4 per cent, according to the latest polls. If the polls can be trusted, that’s a serious collapse.

Can Ukip get anymore MPs?

In the 2015 general election Ukip contested nearly every seat and got 13 per cent of the vote, making it the third biggest party (although is only returned one MP). Now Ukip is reportedly struggling to find candidates and could stand in as few as 100 seats. Ukip leader Paul Nuttall will stand in Boston and Skegness, but both ex-leader Nigel Farage and donor Arron Banks have ruled themselves out of running this time.

How many members does Ukip have?

Ukip’s membership declined from 45,994 at the 2015 general election to 39,000 in 2016. That’s a worrying sign for any political party, which relies on grassroots memberships to put in the campaigning legwork.

What does Ukip's decline mean for Labour and the Conservatives? 

The rise of Ukip took votes from both the Conservatives and Labour, with a nationalist message that appealed to disaffected voters from both right and left. But the decline of Ukip only seems to be helping the Conservatives. Stephen Bush has written about how in Wales voting Ukip seems to have been a gateway drug for traditional Labour voters who are now backing the mainstream right; so the voters Ukip took from the Conservatives are reverting to the Conservatives, and the ones they took from Labour are transferring to the Conservatives too.

Ukip might be finished as an electoral force, but its influence on the rest of British politics will be felt for many years yet. 

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