Category Archives: Unemployment
Theresa May: “the government wants people to be able to manage their own (universal credit) budgets”
Yet again, the vulnerable suffer. Due to successive governments many now in need have been ill-educated, ill-nourished and under stress because they could not find work. In similar circumstances Mrs May and few of her colleagues would be managing their budgets well.
The introduction of universally paying housing benefit direct to landlord (stopped in 2008) was extremely helpful to those not able (or willing) to budget. It has been retained under universal credit and actually adds to the problems of landlords and tenants alike.
Quoting from a letter circulated by GAP Property during PMQs, Jeremy Corbyn said: “Will the prime minister pause universal credit so it can be fixed? Or does she think it is right to put thousands of families through Christmas in the trauma of knowing they are about to be evicted because they are in rent arrears because of universal credit?”
GAP Property said the introduction of universal credit would affect the vast majority of its tenants and it needed to take action to avoid a slew of rent arrears, which could put it out of business.
The company’s owner, Guy Piggott, said the letter was not intended to be threatening and he was pleased it had been highlighted by Corbyn at Prime Minister’s Questions on Wednesday.
“We are not planning to throw people out, but the prime minister should read this and recognise the problems . . . the majority of his tenants were on an average household income of about £17,000 a year. “People are already living hand to mouth . . . At best, if they need to wait six weeks to be paid, it will be the end of February before it comes, and by then they might have spent the money they had on feeding their families or heating their homes”.
Paragraphs from a snapshot of the letter:
Piggott said many landlords would soon refuse to take people who were on universal credit. “A lot of landlords are now saying enough is enough”.
Jeremy Corbyn said: “Will the prime minister pause universal credit so it can be fixed? Or does she think it is right to put thousands of families through Christmas in the trauma of knowing they are about to be evicted because they are in rent arrears because of universal credit?”
Mrs May replied that she wanted to “look at the issue of this particular case” but said the government wanted people to be able to manage their own budgets and expressed less than impressive hopes that the government could act next week to cut the six-week wait for payments to five.
A reader from Bournville draws attention to an article by Jules Birch in Inside Housing, a weekly magazine for housing professionals. He focusses on a recent TV Panorama programme about the benefit cap that now leaves thousands of people with 50p a week towards their rent.
He noticed that roughly 95% of tweets with the hashtag #benefitcap (scroll down to April 7) were hostile to the people featured in the programme rather than the policy. The majority of people commenting on Twitter were seeing the undeserving individual instead: the stroppy single mother with a mobile phone and the couple with many children. He notes that exactly the same thing happened with Benefits Street, How to Get a Council House and a Dispatches documentary on the cap last month.
Part of the problem, he believes, lay with the way Panorama framed the issue. As Joe Halewood was quick to point out, the programme and its advance publicity seemed to assume that most people capped are unemployed and on Jobseeker’s Allowance, when in fact just 13% are.
The fact that the vast majority of people capped are either unable to work or not required to work was only raised tentatively halfway through the programme. Most of those capped are lone parents with young children who are not required to look for work, or people on Employment and Support Allowance who do not qualify for an exemption but are still not fit for work.
David Pipe explained the effects in a piece following the Dispatches documentary last month. 7,500 households across 370 local authority areas have lost their housing benefit and are now receiving just 50p a week to pay their rent. The cap leaves a nominal amount for housing benefit or Universal Credit once someone’s benefits total more than £20,000 (£23,000 in London). In effect it is imposed on top of the rest of the benefits system.
The latest budget highlighted cuts for the poorest 18-21-year-olds, who will no longer be entitled to help with their rent through Universal Credit from April 1.
For many, Discretionary Housing Payments (DHPs) are the only thing keeping them in their home and the effect over time will be rising rent arrears and evictions and allocations policies that make it less likely that people on benefits will get a tenancy in the first place. So where and how can the poorest people live? Even people in caravans are being capped, and what will the knock-on costs be in terms of homelessness and the impact on the children?
Meanwhile in Broken Britain, the May government continues the policies of its predecessors and makes decisions which seriously afflict the poorest and greatly benefit the richest: the arms traders, Big Pharma, the privatised utilities, large developers, car manufacturers, private health companies and expensive, inefficient outsourcers – Serco, G4s and Capita.
There was an outcry when the Chancellor Philip Hammond unveiled a National Insurance hike for self-employed workers in the Budget – now postponed. Some 4.6 million people, around 15% of the workforce, are now self-employed and data from the Office for National Statistics show that two thirds of new jobs in the UK created in recent years are down to self-employment.
Self employment, often insecure, low-paid, with no access to holidays, sick pay, maternity and paternity leave
Now sometimes known as ‘the precariat’, the self-employed, often work in service industries such as fast food, for security firms on temporary, even zero-hours contracts, or in the so-called ‘gig economy’. The precariat includes many workers who used to have skilled or semi-skilled but relatively well-paid and secure jobs, under-employed graduates, often working in insecure jobs requiring a much lower education level, migrant workers, and people from ethnic minority communities.
Well-informed readers explain that – as long as the self-employed have a contribution record established – they get the standard state retirement pension and older self-employed workers attaining pension age today have, in many cases, some pension accrued as employees for a number of years of their life which the present generation will not have. Benefits the self-employed cannot access relate to holidays, sick pay, maternity and paternity leave.
Earlier this month it was reported that Labour is to convene a summit to develop a new deal for self-employed workers and small businesses to develop Labour’s policy on self-employment. – recognising “that the world of work itself is changing”. John McDonnell, the shadow chancellor, said.
“The labour movement has risen to challenges like this in the past. It was born out of the struggle for decent pay and conditions when new technologies were ripping up existing ways of working . . . We need that same spirit and vision again. So I’ll be convening a summit next month of unions, the self-employed, and small businesses to develop Labour’s policy on self-employment”.
Some have been in the forefront, pressing for such action, including Pat Conaty, David Hookes and – for many years – Guy Standing. Pat writes: “The work of Professor Guy Standing at UCL SOAS and formerly at the ILO for 36 years on the Precariat Charter is superb”. See the links at the foot which include Standing’s 2011 Policy Network article.
Pat Conaty, Alex Bird and Philip Ross produced the Not Alone report that Co-operatives UK and the Wales Co-operative Centre have published with Unity Trust Bank – the trade union bank. It focusses on the needs of people in self-employment who face low income and social and economic insecurity – the ‘self-employed precariat’.
The executive summary records that there are now more self-employed workers than at any time since modern records began. Some 4.6 million people, around 15% of the workforce, are now self-employed and data from the Office for National Statistics show that two thirds of new jobs in the UK created in recent years are down to self-employment.
Many of the self-employed are among the lowest-paid workers in the country; their potential income is eroded by other costs such as agency fees and additional challenges relate to difficulties in not being paid on time and not having the right to a contract.
The report calls for the ‘cousins of the labour movement’ – co-operatives, trade unions and mutual organisations – to come together and help form cohesive institutions to unite the self-employed precariat, as illustrated in the model of a ‘solidarity economy’ partnership.
As Conaty says in correspondence: “God knows something has to be done for zero hour workers, growing ranks of exploited self-employed and those working all hours of the week in the gig economy to make ends meet”.
David Hookes: http://pcwww.liv.ac.uk/~dhookes/IWFA.pdf
Wolf: Theresa May’s policies ’make a mockery of her rhetoric’. Are they also provoking ‘generational jihad’?
Martin Wolf (FT) reminds readers of the words of Theresa May, the prime minister, in her speech to the Conservative party conference last year: “Our economy should work for everyone, but if your pay has stagnated for several years in a row and fixed items of spending keep going up, it doesn’t feel like it’s working for you.” She earnestly promised that this would change.
He continues: “Was Mrs May’s speech hypocritical? Yes”.
The work of the increasingly high-profile Resolution Foundation, a charity funded by Resolution, a successful insurance investment firm founded by Clive Cowdery, focusses on low earners and the policy responses required to lift their living standards. Cowdery was knighted in the 2016 New Year Honours for services to children and social mobility
However, Resolution’s new ‘Executive Chair’ is David Willetts, a former Tory minister, described as a pioneer of generational jihad – revealing “a country that is choosing to give priority to the well-off over the poor, and the old over the young” (see https://twitter.com/resfoundation)
Wolf comments that whatever such a country might be, it is not one that, in the prime minister’s own words, acts “to correct unfairness and injustice and put government at the service of ordinary working people”.
Willetts should heed Richard Smerdon (Letters, FT):
As I and many others can testify, millions of ageing men and women in this country are supporting their struggling children (themselves in their 30s and 40s but struggling nevertheless) in a huge variety of ways: childcare, money (in lump sums, guarantees and regular payments) and accommodation. This at a time (since the banking collapse) when returns on one’s savings have been negligible. We’ve been clobbered as well! The mess the government has got itself into over the crass handling of the tax credit issue (reform, yes, but wholesale impoverishment, no) is entirely its own fault, but many pensioners will be bracing themselves to help out yet again — which we do out of love for our children of course — but it seems an unfair additional penalty to pay for government incompetence.
Using the latest forecasts from the Office for Budget Responsibility to project household incomes up to 2020, the picture is one of rising inequality. Wolf asks, “Why is this happening?” He gives several reasons, including the impact of Brexit and the tax and benefit plans inherited and maintained by Mrs May.
Theresa May, as the Resolution Foundation puts it, is “actively choosing to increase inequality”. To those who have, the government has decided to give
The significant cuts in benefits for those of working age, notably the freeze on most benefits in cash terms are being exacerbated by the rising post-referendum prices. Also important are substantial tax cuts for the relatively well-off. FT View (editorial) adds: “By pressing ahead with these inherited policies Theresa May, prime minister, as the Resolution Foundation puts it, is “actively choosing to increase inequality”.
Wolf states: “This outcome makes a mockery of the government’s inclusive rhetoric”.
Mary Dejevsky refutes the Resolution assertions (echoed by MSM) that government is prioritising the old over the young
Wolf writes: “The government is giving priority to the well-off and the old over the poor and young”, but Mary points out that the average pensioner still has an income 25% below the average worker, adding: “You wouldn’t guess that from the media”. She points out:
“The state pension is one of the last truly contributory payments. To present it as just another handout and part of a ballooning benefits bill is an invitation to the young to resent the amount spent even more — and to the recipients to feel that they are being patronised. The state pension should be separated from the overall benefits bill forthwith”.
A graph compiled by Aegon Insurance shows that though the income gap has narrowed substantially, working households still have a higher disposable weekly income than pensioner households.
The Foundation’s latest report includes housing costs to back up its announcement that pensioner incomes (most mortgages paid) have overtaken working-age households (paying rent or mortgage charges).
A year after Mary wrote this article, the Western Daily Press reported on a study published in the Journal of the Royal Society of Medicine
“The elderly are dying from heart attacks and strokes because of the stress of cuts in their pensions, according to new research. Rising mortality rates among over 85s has been linked to reductions in spending on income support for the worst off. The study published in the Journal of the Royal Society of Medicine suggests some vulnerable older people have paid the ultimate price for austerity measures in England. Almost nine in ten of the 4.6 per cent increase in deaths in 2012 can be explained by the decline in pension credit beneficiaries, say scientists. In England, total spending on Pension Credits, income support payments for low-income pensioners, reduced by 6.5 per cent in 2012”.
Wolf concludes that the UK confronts huge challenges. Not only is productivity stagnant, it must also navigate Brexit: “It is hard to believe wise choices are being made for a country that wishes to secure a better future for its people. It is still harder to believe these are moral choices for a country forced to share out losses imposed by a massive financial crisis and weak subsequent growth” ending:
“The government may be brazenly hypocritical. But it also seems likely to get away with it”.
But the FT editorial adds a stark warning:” There is little chance of Philip Hammond, chancellor, reversing his predecessor’s regressive policies in next month’s Budget. Yet he should keep them under review. If the outlook darkens, a combination of falling living standards and rising inequality would be an extremely dangerous one in today’s febrile (Collins: intense, nervously active) politics”.
In other words: a roused public might rock
the corporate/political boat.
Much of the media is taking its usual stance referring to Jeremy Corbyn’s ‘handlers’ as though he were a pit bull terrier. The Times has determined that he was making a bid to relaunch his leadership which has been derailed and Jim Pickard in the FT, author of many hostile articles, focusses on pay caps but not pay ratios.
It is good to turn to sane and rightminded commentators such as Peter Burgess (Times comments) and Maisie Carter (recent article). Peter spells out the Corbyn message with absolute clarity and rather more bluntly than JC:
- It is very clear he wants top execs pay to reflect that of the lowest paid worker for them to earn more and not rely on tax payers to boost their salaries and for the top execs to earn a decent salary but nor one that is obscene (sadly so many Tories want to see the poor get poorer and the rich richer).
- He also wants to ensure that we continue to bring in workers when needed but ensure they don’t depress wages for British workers.
- Of course those at the top getting obscene salaries want to disgrace Corbyn because the last thing they want is for their salaries to fall under £500,000 a year.
- There’s big and there’s obscene especially when they are telling others to tighten their belts, can’t afford to pay you more then handing themselves 7 and 8 figure salaries and bonuses.
- What shows double standards are all those commenting on here who think salaries of over £100,000 a year are too much if somebody is running the NHS, a local authority or running a Union.
- I do find it difficult to understand how anybody can find the policies which have allowed so many workers to have their wages and working conditions deteriorate whilst CEO’s are paying themselves up to 700x the salary of their employees as being fair and something they’d support.
- I would add that labour to their shame played an important part in allowing these obscene differentials since Maggie was in office. Some of them thought £500,000 a year for them and their friends was not enough.
- Yes Corbyn needs to keep shaming all those, including some labour MP’s who’ve happily supported the policy of “austerity” that have hit the poorest whilst allowing the richest to continue to get richer.
- I’d support a return to the differentials back in the days of Maggie. Top execs back then were hardly struggling. 20x / 30x acceptable 700x isn’t!
Endnote: Maisie Carter’s appeal
“Unite around Jeremy Corbyn’s ten point programme, which proposes the building of one million homes in five years, a free national education service, a secure, publicly provided NHS, with an end to health privatisation, full employment, an end to zero hours contracts, security at work, action to secure an equal society, a progressive tax system, shrink the gap between highest and lowest paid; aim to put conflict resolution and human rights at the heart of foreign policy. On the last point, as the wars waged or aided by the West are the cause of mass immigration, we must step up foreign aid and instead of spending £37bn a year on foreign wars as our government does, invest in helping to rebuild these war torn countries”.
Read Maisie’s article in full here.
On 14th July a Moseley reader emailed to say “Theresa May’s speech yesterday sounded more left wing than your mate JC!”
My reply was a one year snapshot of her actions in office which belied this humanitarian stance, published earlier on this site:
- In 2010 she suspended the registration scheme for carers of children and vulnerable people.
- On 4 August 2010 it was reported that May was scrapping the former Labour Government’s proposed “go orders” scheme to protect women from domestic violence by banning abusers from the victim’s home.
- This was followed on 6 August 2010 by the closure of the previous Government’s “ContactPoint” database of 11 million under-18-year olds designed to protect children in the wake of the Victoria Climbiéchild abuse scandal.
“Rewarding hard-working people with higher wages”.
This is another of Ms May’s Corbyn-like soundbites made shortly after Corbyn’s description of what he saw as the difference between the Conservative and Labour offerings, in the form of a question:
“Do you want to be bargain-basement Britain on the edge of Europe, cutting corporate taxation, having very low wages, having grotesque inequalities of wealth? Or do you want to be a high-wage, high-investment economy that actually does provide decent chances and opportunities for all?”
We read that Theresa May has launched a cabinet committee on the economy and industrial strategy, which she is to chair; it will bring together the heads of more than ten departments and focus on “rewarding hard-working people with higher wages”.
Is Corbyn the most powerful, though least acknowledged of Theresa May’s advisers on the political economy?
If only she would heed him on nuclear and foreign policy issues.
With thanks to the reader working in Uganda who sent this link from which we give extracts:
It will be good for Britain if Jeremy Corbyn wins his fight to stay as leader of the Labour Party. I agree with the late Queen Mother that the best political arrangement for this country is a good old-fashioned conservative government kept on its toes by a strong Labour Opposition.
There’s no sign of a good old-fashioned conservative government. But Mr Corbyn speaks for a lot of people who feel left out of the recovery we are supposed to be having, and they need a powerful voice in Parliament.
There is nothing good (or conservative) about low wages, insecure jobs and a mad housing market which offers nothing but cramped rooms and high rents to young families just when they need space, proper houses with gardens, and security.
I wish the voiceless millions of conservative patriots had a spokesman as clear and resolute as Mr Corbyn is for his side.
It hasn’t worked. In the USA it has failed so badly that the infuriated, scorned, impoverished voters of Middle America are on the point of electing a fake-conservative yahoo businessman as President.
So far we have been gentler with our complacent elite, perhaps too gentle. Our referendum majority for leaving the EU was a deep protest against many things. But it did not actually throw hundreds of useless MPs out on their ears, as needs to be done. They are all still there, drawing their pay and expenses . . .
If Mr Corbyn wins, our existing party system will begin to totter. The Labour Party must split between old-fashioned radicals like him, and complacent smoothies from the Blair age.
And since Labour MPs have far more in common with Mrs May than with Mr Corbyn, there is only one direction they can take. They will have to snuggle up beside her absurdly misnamed Conservative Party. And so at last the British public will see clearly revealed the truth they have long avoided – that the two main parties are joined in an alliance against them.
And they may grasp that their only response is to form an alliance against the two big parties. Impossible? Look how quickly this happened in Scotland.
Is such an alliance gathering now? See http://greenhousethinktank.weebly.com/uploads/4/8/3/2/48324387/green_house_progressive_alliance_july_2016.pdf
American blue collar workers are angry (The Times); Martin Wolf adds a growing and widespread sense that ‘elites are corrupt, complacent and incompetent’
Today the Times interprets unusual polling results in the United States. Like many American media commentators, it predicts that “blue-collar workers who are worried about the effects of globalisation on American jobs promise to shape the November election”.
In the Financial Times, analyst/economist Martin Wolf expresses a belief that the ‘native working class’ are seduced by the siren song of politicians who combine the nativism of the hard right, the statism of the hard left and the authoritarianism of both.
’A plague on both your houses’?
He writes: “The projects of the rightwing elite have long been low marginal tax rates, liberal immigration, globalisation, curbs on costly “entitlement programmes”, deregulated labour markets and maximisation of shareholder value. The projects of the leftwing elite have been liberal immigration (again), multiculturalism, secularism, diversity, choice on abortion, and racial and gender equality . . . As a recent OECD note points out, inequality has risen substantially in most of its members in recent decades. The top 1% have enjoyed particularly large increases in shares of total pre-tax income”.
David Cameron responds to church leaders’ attacks by saying that the reforms are part of a moral mission
Wolf continues: “In the process, elites have become detached from domestic loyalties and concerns, forming instead a global super-elite. It is not hard to see why ordinary people, notably native-born men, are alienated. They are losers, at least relatively; they do not share equally in the gains. They feel used and abused. After the financial crisis and slow recovery in standards of living, they see elites as incompetent and predatory. The surprise is not that many are angry but that so many are not”.
Wolf sees the electorate turning to ‘outsiders’ to clean up the system in Britain, the US and many European countries and advises ‘the centre’ how to respond:
- People need to feel their concerns will be taken into account, that they and their children enjoy the prospect of a better life and that they will continue to have a measure of economic security.
- They need once again to trust the competence and decency of economic and political elites.
- Disruptive mass immigration needs to be brought under control; refugees must now be the priority.
- There must be a fundamental questioning of its austerity-oriented macroeconomic doctrines: real aggregate demand is substantially lower than in early 2008.
- The financial sector needs to be curbed. It is ever clearer that the vast expansion of financial activity has not brought commensurate improvements in economic performance. But it has facilitated an immense transfer of wealth.
- Taxation must be made fairer. Owners of capital, the most successful managers of capital and some dominant companies enjoy remarkably lightly taxed gains.
- The doctrine of shareholder primacy needs to be challenged. With their risks capped, their control rights should be practically curbed in favour of those more exposed to the risks in the company, such as long-serving employees.
- And, finally, the role of money in politics needs to be securely contained.
Wolf concludes pragmatically: “western polities are subject to increasing stresses. Large numbers of the people feel disrespected and dispossessed. This can no longer be ignored”.
Self interest rules OK! The threat to the status quo is paramount – the ethical dimension totally ignored.
In Canada, Britain, Greece, Italy and Spain, ‘a sense of revulsion at the political elite’ is leading a popular vote for those seen as trustworthy candidates, who care for the 99%.
In the New Hampshire Democratic presidential primary, Senator Bernie Sanders has gained 60% of the vote, compared with Hillary Clinton’s 38%. As noted earlier on this site, Sanders has a Corbyn-like appeal for younger voters and is attracting far larger audiences than expected. He has assembled an online fundraising operation and ‘electrified’ the youth vote with promises of a “political revolution” that would bring Scandinavian-type policies to the US.
The Times reports that, in a speech to his supporters after the contest, Mr Sanders said the result marked a new era, adding: “What the people here have said is that given the enormous crises facing our country, it is just too late for the same old, same old establishment politics and establishment economics”.
“A message that will echo from Wall Street to Washington”
Sanders’ message that that the government of our great country belongs to all of the people and not just a handful of wealthy campaign contributors and their Super PACs [political action committees] and that the economy is rigged in favour of a “billionaire class” struck a chord among New Hampshire voters who did not trust Mrs Clinton and her ties to Wall Street, reference being made to the “1%”.
According to exit polls, income inequality and jobs – two central themes of the Sanders campaign – were the top issues for Democrat voters. More than half said they were dissatisfied with the current state of politics. Just as people in Britian cared more about a candidate’s trustworthiness than about experience or electability, the same ranking of priorities has favoured Bernie Sanders.
Corbyn and Sanders offer the hope of peace and justice to a divided people, currently exploited by the wealthy 1%.