Full employment and rising wages are the key to welfare reform

Iain Duncan Smith was once right about the need for drastic change - then he got everything else wrong.

When Iain Duncan Smith starting visiting to Easterhouse and steered the new Centre for Social Justice (CSJ) towards a Tory-analysis of poverty, he was hailed by many as a prophet. Finally, wrote breathless commentators, the ‘nasty party’ had found a route-map to Compassionate Converatism. Five years later, IDS is part of a government that is plunging one million children into poverty and is ramming through the House of Lords new laws that will cut help for 3.5 million disabled people. The Saint of Easterhouse has become the punch-bag of the Treasury. The route-map, is turns out, was a chimera.

But IDS is still standing in part because he stands on the foundations of the CSJ’s study. I might disagree about lots of their conclusions but I can respect the fact that they actually bothered to look at the problem. Reform of social security – currently one-third of public spending – is a big question. It demands and deserves deep thinking not a casual look. And that’s why the launch on 14 February of the Commission on the Condition of Britain is so welcome, and why I’ll be following its work so closely. Back in the 1990s, the Commission on Social Justice at the IPPR was critical to Labour’s social security reforms in office. I hope we’ll learn just as much from the IPPR’s second big look two decades later.

The truth is major reform of the welfare state is mission critical to rebuilding Britain after the global financial crash; it’s crucial to creating a country where we end the trauma of the living standards crisis, and it’s crucial to renewing a shared sense that we really are all in this together. This is the frame that Jon Cruddas set out for One Nation Labour in an important speech at the Resolution Foundation this week; ‘earning and belonging’.

When the Beveridge Report was published seventy years ago in the middle of World War Two, it was swept off the shelves by a British public thirsty for a vision of what would come when peace was won. At the heart of Beveridge’s argument was the idea we needed social insurance to help working families deal with the exigencies of life that caused new pressures (like the costs of children) or caused a loss of earnings , like the mass unemployment of the 1930s.

Today, the challenge for social security is not simply to minimise disruption to earnings, it is to help families maximise the potential of earnings. Beveridge’s world-view was set during the Devil’s Decade of the 1930s. Our world-view must be shaped by the gigantic squeeze on earnings that means living standards for ordinary working families might not recover, according to the Resolution Foundation, until the 2020s.

The reality for Britain today is that right now, productivity is going up; corporate profits are going up; companies are piling up cash in their bank accounts at a rapid rate of knots. Yet real wages are falling. In other words, workers are producing more and earning less. If we’re to reverse this giant trend, we are going to need new strategies for full employment – because full employment is the best guarantee of rising wages. We’re going to need new strategies to help working parents – especially mums – juggle childcare and sustain their careers. We need new ways to help the over 50s stay in work. And we need a radically new approach to disability policy so that government actually puts a team behind disabled people helping them get on in life, not a bureaucracy against them locking away help.

The IPPR’s work couldn’t come at a better time. Half way through the Parliament it’s now clear, the Conservatives so-called welfare revolution is collapsing in chaos. It doesn’t help working families get on. Its making poverty worse. The DWP is no longer even able to organise work experience in Poundland, never mind complex change like Universal Credit. We’re determined to offer a bold alternative, that staunches the cost of failures and puts social security once more, back on the side of working people.

The Easterhouse estate, Glasgow. Source: Getty

Liam Byrne is Labour MP for Birmingham Hodge Hill, cofounder of the UK-China Young Leaders Roundtable and author of Turning to Face the East: How Britain Prospers in the Asian Century.

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How will British science survive Brexit?

What the future of science and tech looks like in the UK, without the European Union.

Science and tech are two industries most likely to be affected by Brexit. British science and tech companies were overwhelmingly in favour of remaining. A Brexit survey run in March by Nature found that of the 907 UK researchers who were polled, around 83 per cent believed the UK should remain in the EU.

UK scientists receive close to £1bn annually for research from the EU – a testament to the quality and influence of the work done on British soil. Between 2007 and 2013, the UK sector supported EU projects by spending €5.4bn, and was rewarded in return with funds of around €8.8bn; it’s a give and take relationship that has seen growth for both.

The combined science and tech sector has laid down the framework and investment for some of the most important research projects in the world. To date, the brightest minds in the UK and Europe have combined to work on highly influential projects: the Large Hadron Collider headed by CERN discovered the Higgs Boson particle, the Human Brain Project set itself the gargantuan goal of unravelling the mysteries of the human brain, and the European Space Agency has helped expand space exploration as European and British astronauts have headed into the ether.

In May 2016, chairman of the Science and Technology Facilities Council Sir Michael Sterling announced that UK scientist Professor John Womersley will lead Europe's next major science project – the European Spallation Source  which is a "multi-disciplinary research centre based on the world's most powerful neutron source." It's the type of project that creates openings and opportunities for researchers, in all fields of science, to really materialise their most ingenious ideas.

The organisation techUK, which according to their website represents more than 900 companies, said in a statement that the result has created many uncertainties but has attempted to appease concerns by declaring that the UK tech sector “will play its part in helping the UK to prepare, adapt and thrive in a future outside the European Union.”

BCS, the Chartered Institute for IT, has reinforced techUK’s concerns surrounding uncertainty, highlighting areas which need to be addressed as soon as possible. The institute believes that discussions with the EU should focus on ensuring access to digital markets, freedom to innovate and growth of “our academic research base and industrial collaborations in computing . . . to shore up and build on a major driver of UK economic success and international influence in the digital sphere”.

Confusion over the UK’s position in the EU single market has prompted questions about the freedom of movement of labour, raising concerns among researchers from Europe about their future role in UK-based projects. The naturally collaborative nature of STEM research, the cross-breeding of ideas which foster scientific and technological advancement, could be severely hampered if limitations are imposed as a result the UK’s separation from the single market.

Speaking to the BBC, Sir Paul Nurse, Nobel Prize winner and director of The Francis Crick Institute said: “Being in the EU gives us access to ideas, people and to investment in science." The Royal Society reports that researchers at UK universities house more than 31,000 researchers of EU origin. The danger of losing much of that support is now imminent.

Many other leading voices in the community chimed in too. Paul Drayson, former Minister of Science in the Department for Business, told Scientific American: “The very idea that a country would voluntarily withdraw from Europe seems anathema to scientists.” Remain advocate Jo Johnson, the Minister of State for universities and science (and brother to the leave campaign’s front man, Boris Johnson), stated his concerns to a House of Lords committee of there being very little means to make up for severed EU finances. The referendum result means that a solution to replace that money from a different source must now be sought. He also tweeted:

Despite the science and tech sector favouring a Remain vote, there were some who were leaning towards Brexit pre-referendum. Scientists for Britain, a group of UK scientists who, according to their website were “concerned that pro-EU campaigners are misusing science for political gain”, issued a statement after the referendum. They thanked leave voters for sharing their vision of the UK “outside the political structures of the European Union.”

Though there are many new policies which will need to be drawn up, it is evident that the UK’s requirement to prop itself up once outside the EU will only serve to hinder science and tech growth. The industries best served through European and global outreach are now at risk of being marginalised.

Currently in place is “Horizon 2020” – an enterprise touted as “the biggest EU Research and Innovation programme ever” as almost €80 million is available to researchers seeking to take their ideas “from the lab to the market”. Once Article 50 is invoked, it is crucial that any negotiations that take place ensure the UK’s spot within the programme is maintained.

There are options to maintain some European integration; gaining an “associated country” status like Switzerland could continue to strengthen the STEM sector, for example. But prioritisation of science and tech seems bleaker by the day. As a new landscape takes shape post-Brexit, we must work tirelessly to prevent our most progressive and forward-thinking frontiers caving in.