A fortnight is a long time in politics. Just 12 days ago Esther McVey branded reports of welfare cuts as “fake news”. Now she has publicly admitted that as it stands, some families will lose out when Universal Credit is rolled out. Not that that has stopped her department from making charities and private contractors that work with the DWP sign gagging orders preventing them from criticising McVey or damaging her reputation, according to a sensational story in today’s Times.
But no amount of gagging orders can resolve the government’s essential problem: that the cuts to in-work benefits George Osborne had to abandon in 2016 are alive, well and intended to be rolled out alongside Universal Credit. These are benefits that are claimed by many people who voted Conservative in 2010, 2015 and 2017.
It’s become customary to compare these cuts to the poll tax, but I think that they are in every way worse: in terms of the consequences for the people affected and the potential repercussions for the government. For the people involved, a poll tax bill you can’t pay is, for obvious reasons, several orders of magnitude less destructive than £200 less in your pocket every month. And from a political perspective, it is much harder to unpick than the poll tax, which could simply be replaced with another, less politically toxic revenue-raiser.
Added to that, the Conservative government in 1990 had a majority of 102. This government has a majority of 14, and arguably even that pretty thin majority doesn’t really exist anymore.
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One way out – which, according to today’s Telegraph the government is taking – is to mothball the planned tax cut for people earning between £46,530 and £50,000 and the rise in the taxable threshold from £11,500 to £12,350 and use the extra revenue to put more money into Universal Credit. That’s not politically pain-free by any means, but nervous Conservatives in marginal seats will take that if the alternative is pushing on with Universal Credit in its current form.
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