‘For a decent standard of living, we all need security and stability in our lives – secure housing, a reliable income and support when things get difficult. For too many there is no such security. Millions of people in the UK are struggling to get by, leading insecure and precarious lives. It’s time to take action on poverty and put this right.
Joseph Rowntree Foundation
UK Poverty Report 2019/20
Warning…warning…black hole ahead! No, not of the dense matter variety but one of the financial kind. That is, of course, if we are to believe the doom-mongering headline in the Financial Times this week that ‘Javid is set to miss his surplus target as finances head for £12bn black hole’. It suggested that if the economy followed the Bank of England’s economic forecast, it would leave the Chancellor with a £12bn deficit by 2022-3 instead of the surplus he is aiming for and he might have to consider tax rises or more austerity to fill this ‘black hole’.
On the one hand, we have some in the government promising to splash some cash on our decaying school, hospital and other public infrastructure, a situation which has arisen as a result of a decade of government deliberately harmful austerity policies. And on the other, a Chancellor promising fiscal prudence having previously, it must be said, declared an end to austerity. There seems to be some internal conflict on the subject! Oh, to be a fly on the wall in the conversations between No 10 and No 11!
While the planet continues to burn, and our public and social infrastructure further decays, the head bean counters in the Treasury and other public institutions are still tallying the public accounts on their abacuses. One hopes that we are starting to move away from such narratives, but equally one wonders whether the usual economic mantras will again kick back in? The Conservatives have dined out for decades on their reputation of economic competence and fiscal rectitude. They have used it successfully to mount attacks on the previous Labour government with the message that they had to sort out its mess (when the banks were to blame), and to justify dismantling the public and social infrastructure.
It has given them the perfect opportunity to deliver their ideological agenda of reduced state intervention, but at the time pour public funds into private profit. It has sold the public the incorrect narrative that our public services depend on collecting sufficient taxes which, in turn, they say depends on a healthy economy which, in turn, depends on businesses being able to make money with the least regulation possible.
The public has largely gone along with this narrative since understandably it measures the public accounts in the same way as its own. Of course, private households – that includes you and me – ARE bean counters. We get an income, out of which we must pay our bills and settle any borrowing repayments with anything left over being used for discretionary spending or saving. If there is anything left over, that is.
The same goes for local government, which relies on government funding and local tax collection to fund its services. It also applies to businesses and corporations whose success, or otherwise, depends on their profit and loss sheets. We are all users of the currency and as such dependent on the whims of government and its ideological agenda. Neither businesses nor local government have currency-issuing powers and nor do individual citizens unless, of course, they are breaking the law!
We have been led to believe that the health of the economy is measured in whether a government can balance its budget or save for a rainy day. We’ve gone down Alice’s rabbit hole and supped the ‘drink me’ potion with dire results. We need to rethink this accounting model which puts financial health above the health of the nation and the economy and does not represent actual monetary realities.
If we haven’t already, we should start by casting an eye over the consequences of the economic orthodoxy which has led to austerity and cuts to public spending. Only this week the Joseph Rowntree Foundation published its report UK Poverty 2019/20 which provides a stark reminder of the dire effects of both the Conservative ideologically driven policies and its austerity agenda. The CEO of the JRF Claire Ainsley described the new government as having a ‘historic opportunity [..] to loosen the grip of poverty among those most at risk’ although its criticism fails to point the finger directly at government policies which have led to rising poverty and reinforced the gap between the rich and working people. It also fails to acknowledge an understanding of the long-term agenda that austerity has been – a cover for reduced state intervention, less democratic accountability and the promotion of the notion of self-reliance and personal responsibility.
The statistics should shock us:
- The poverty rate is at 22% with little change in recent years
- 5m people were destitute at some point during 2017 including more than a third of a million children.
- Seven per cent of individuals have been in poverty for more than two years
- Around 14 million people are in poverty in the UK, more than 1 in 5 of the population made up of 8 million working-age adults, 4 million children and 2 million pensioners.
- In-work poverty has risen from 9.9% in 97/98 to 12.7%.
- Around 56% of people in poverty are in a working family compared to 39% 20 years ago.
- Seven in 10 children in poverty are now in a working family
- In 2017/2018 31% of the 13m people with disabilities in the UK lived in poverty; that is around 4 million people.
- There are 4.5 million ‘informal’ carers in the UK, of which nearly a quarter were living in poverty. More than half were women and three-quarters of working age.
- Rates of poverty amongst Bangladeshi or Pakistani households is nearly 50%
This is but a small snapshot of the report which you can read in full here. Beneath these statistics lie the real lives of real people struggling on a daily basis to keep a roof over their heads, bills paid and food on their table whilst at the same time grappling with insecure employment in the low-paid, part-time, gig or zero-hours economy. And these things are no longer the burden of just working-class people, middle-class professionals, from nurses to teachers and academics, are now feeling the pinch as government has, over 10 years, cut its spending and made their jobs increasingly precarious.
Some would have us believe, like the political commentator Iain Dale, that cuts to spending were not responsible for the tragic death of the young French teenager at the Tate Gallery. Incensed, he stormed out of an interview on Good Morning Britain when Grace Blakely suggested that austerity had been at the heart of this terrible event and made the entirely valid point that our most vulnerable children have been failed by a government that is supposed to protect them.
And that is the nub of the question. What is the role of government? To balance its books or serve public purpose? We have been consistently failed by a government that has put bean-counting at the heart of its policies, not because it was essential to deliver a balanced budget, but to deliver its long-held belief in its political agenda, an agenda which has been pursued by successive governments on the right and left. The fact that it is promising to spend now (with caveats) should surely be a signal to ask why if there was no money yesterday there is today and why, when it suits, the government can always find the monetary wherewithal to spend? The next question we should ask is who will benefit from this increased government spending if it goes ahead?
While the wealthy carry on getting richer and businesses continue to benefit from public money, whether in the NHS (minus its National) or education, social care, local government or other public institutions, the public and social frameworks are decaying by the minute with no apparent let up despite all the wonderful promises. Time will tell, as will the next Chancellor’s budget in March.
In the meantime, the stories of those affected by government policy continue to cause concern. This week, ITV published Department of Housing figures which showed that the numbers of people with disabilities and medical conditions waiting for housing had risen by almost 11,000 in two years – a rise of more than 10%.
The National Audit Office, as a result of the concerns about links between welfare reforms and declining mental health, reported on its investigation of how government monitored suicides among benefit claimants, saying it was highly unlikely that the 69 cases investigated by the DWP over a five-year period represented the overall numbers of self-inflicted deaths. It criticised the government for not having any robust record of contact from coroners about such cases.
Furthermore, a report published by the Office for National Statistics earlier this week revealed that people’s life satisfaction fell in July-September 2019 compared to the year before and that anxiety remained high as concerns about the future economic outlook and employment prospects grew. It also revealed that real household spending per person had grown at its slowest rate since the end of 2016.
As northern cities face huge cuts to council funding, adding to the already dire financial situation being faced by councils and the prospect of more cuts or local tax rises, combined with a country facing the prospect of weak growth as a result of government’s 10 years of domestic policies and a global slowdown, the future is not looking bright right at this particular moment. We have been led down a dark alley with a dead-end at least for the majority of citizens.
But it didn’t, indeed doesn’t, have to be like this. With the knowledge to challenge the notion that money is scarce and that there is no alternative to the market-led dogma which has dictated government policies for too long, we could turn things around. We are fighting an ideological battle dressed up in household budget terms and as a result, the future of our public and social infrastructure, not to mention our planet, is at stake.
In the light of the confusion and uncertainty which currently prevails and a divided left wing which is tracking backwards, we need a conversation about where we go from here. What sort of society do we want to live in? A dystopian Mad Max society which favours large corporations over democracy and puts individuals at the top of the pyramid or one which understands that humans flourish best where there is cooperation, compassion and caring? It’s up to us. As Howard Zinn, the political activist wrote ‘You can’t be neutral on a moving train’.
The Gower Initiative was formed to begin that conversation and challenge the status quo. You can find out more here.
If you would like to be part of that conversation, we have four events coming up in February and March. Join us if you can! Follow the links for tickets.
London
20th February
https://www.eventbrite.co.uk/e/gower-initiative-for-modern-money-studies-seminar-tickets-88843075029
22nd February
https://www.eventbrite.co.uk/e/mmted-masterclass-tickets-88855464085
Manchester
21st February
https://www.eventbrite.co.uk/e/gower-initiative-for-modern-money-studies-seminar-tickets-88853917459
Northampton
28th March
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