Tag Archives: justification narrative

Osborne’s big plan: falsify unemployment figures under the Workfare banner

A swivel-eyed loon, earlier today. [Picture: Left Foot Forward]

A swivel-eyed loon, earlier today. [Picture: Left Foot Forward]

So Gideon wants the long-term unemployed to go on Workfare indefinitely, does he?

Forgive me if I’m mistaken, but doesn’t this mean the Chancellor of the Exchequer’s big announcement – at this year’s Conservative Party Conference – is a tawdry plan to massage the unemployment figures?

I’m indebted to The Void blog for the following information, which I recalled while reading reports of Osborne’s drone to the swivel-eyed masses. An article from May stated that the Department for Work and Pensions (DWP) had been forced to admit a rise in unemployment was down to a fall in the number of people on Workfare.

“According to the Department, the number of people in work fell by over 47,000 over the last three months – which they say ‘reflects’ amongst other things a drop of 16,000 in the numbers on Government employment schemes,” the article states. As far as I know, this is still correct – if a person is put on Workfare, they are removed from unemployment statistics, even though they only receive social security payments for the work they do.

Putting the long-term unemployed on Workfare indefinitely, therefore, will effectively wipe long-term unemployment from the national figures. This will make Osborne’s administration look very good indeed – despite having done nothing to improve anyone’s chances of finding a job. In fact, those prospects will have worsened because every Workfare place removes a paying job from the market.

And what will this do for the Bank of England’s scheme to raise interest rates only if unemployment drops below seven per cent?

Wait – it gets worse. We can also see a now-traditional Tory ‘bait-and-switch’ going on, supported by a justification narrative based on a bit of voodoo polling. This one pushes lots of our favourite buttons!

Osborne’s rationale for imposing the scheme – the justification narrative – is simply that people want it. He’s basing his reasoning for this on a voodoo poll by the right-wing Policy Exchange, as described on The Void today.

“The general public’s opinions on workfare have been grossly distorted by the nature of the questions asked in this survey – of which there were only two,” the article states.

“The first question asked whether people thought ‘The government should require people who are unemployed for 12 months or more to do community work in return for their state benefits.’ The truth is that only just over half agreed at 56%. But the public were not asked if this workfare should be full time. In fact it does not even specify that the work should be unpaid – previous workfare schemes have come with a top up payment to benefits attached. Whilst those engrossed in welfare policy might assume workfare to mean 30 hours a week, every week, without pay, there’s no reason a survey respondent would think that. They might think yes, they should volunteer in an old people’s home for an afternoon a week, or do a couple of days a month helping out in the local park, for reasonable expenses. This 56% in no way gives a mandate for full time unpaid workfare.”

It continues: “The second question is even more dubious. The Policy Exchange are attempting to use the answers to this question to claim that only 22% of the public support disabled people being exempt from workfare. That incidentally is disabled people “who are capable of working” – another devious phrase as who is and isn’t capable of working is clearly open to debate as the Atos scandal has shown. The obvious inference from the from this figure is that 78% of the public support workfare for disabled people. Yet in question 1 only 56% of people support workfare for anyone at all. There must be something in the going on to explain this bizarre discrepancy.

“Question 2 asks respondents to imagine that compulsory workfare exists and then questions who should be exempt. Now a disabled person completing this survey may think well if I have to do workfare then why shouldn’t a lone parent, and vice versa. That doesn’t mean they support workfare, it means they support equality, of a sort.

“There is no option available for those who think that everyone should be exempt from workfare, although it is possible to answer that every group of claimants given should undertake unpaid work.”

So: Extremely dubious findings, used to support a dubious claim that the public supports increasing Workfare and this is why the Coalition is doing so. In fact, this is a thinly-veiled attempt to falsify unemployment statistics and trigger an interest rate rise.

The swivel-eyed loons must have lapped it up.

Now, why wasn’t Vox Political‘s best friend, Iain Duncan Smith, making this announcement?

Get a clue, George! (Or: Saving the economy, part two)

What a lot of twaddle Gideon George Osborne was peddling to Andrew Marr yesterday!

Speaking in advance of his Autumn Statement (or mini-budget) on Wednesday, Gideon told us all that cutting the UK’s financial deficit was “taking longer” than planned. This is because his government hasn’t invested in any infrastructure projects worth mentioning, or created jobs any other way. Where projects have been identified (HS2, new airport/runway), his political party has descended into squabbles over price and place.

He said “to turn back now would be a complete disaster”, which is true but pointless, as nobody is contemplating it. If Labour were to take over in 2015, they would have to look at the situation then and find a way to progress from there – they wouldn’t try to turn back the clock; that’s not possible.

He said richer people would “pay their fair share”, which means nothing when we don’t know what Mr Osborne considers is fair to richer people. What we’ve seen so far would suggest he likes to hammer the poor while handing richer people a tax rebate. Do you think that’s paying their fair share?

But I’ve already tackled what I would do with taxation.

He said the deficit was down by a quarter. This is a statistic that the Tories like to peddle but it is utterly meaningless when you see that borrowing for October hit £8.6 billion – £2.7 billion more than in October 2011. How is this an improvement?

He did show one flash of wisdom; he wisely refused to divulge any of the Office for Budget Irresponsibility’s economic forecasts in advance of Wednesday’s Statement. This is an organisation that has been consistently wrong, ever since it was set up. I wouldn’t trust it to speak my weight.

His worst transgression, though, was this: “To go back to the borrowing and the debt and the spending that Ed Balls represents would be a complete disaster for our country.”

Get a grip, Gideon! Borrowing during the Labour years was around 2 per cent LESS than during any preceding Conservative administration over the last 40 years! As for debt, even after the financial crisis and the bank bailout, the UK’s debt was a lower percentage of GDP than it had been for most of the 20th century! You are peddling an infantile justification narrative that even a child can see is nonsense!

I think the biggest problem here is one of perception. Gideon‘s idea of borrowing and spending involves borrowing money to give to his party’s fatcat business friends through government schemes like the work programme (don’t let them tell you it’s payment by results – even the DWP has admitted it isn’t). If he actually got down to proper investment, in proper infrastructure projects, the economy would start to rally.

Government investment of this kind would, in fact, pay for itself – and help pay off the deficit.

Any spending has a greater impact on the rest of the economy than the initial outlay; this is known in the jargon as the ‘multiplier effect’. There are a variety of multipliers depending on the sector. The highest multiplier is attached to construction at 1:2.06, meaning that every £1bn invested in construction will actually generate £2.06bn in new activity.

The government could, for example, embark on a massive programme of publicly-owned housing, to help reduce the deficit. It can do so much more efficiently than the private sector for three reasons: First, government has a return in the form of taxes; secondly, welfare spending falls as people are brought into work; thirdly, government borrows at much lower interest rates.

For these reasons, government can actually build the same house for a much lower net outlay than the developer and so offer affordable housing which contributes to reducing the deficit.

Also, there are 1.8 million families (representing over five million people) on council house waiting lists. There is an urgent need to build affordable housing for these people, which would also help reduce housing benefit payments.

There is no obstacle to increasing borrowing in order to fund investment. The interest rate on 10-year government borrowing is currently well below the level of inflation – meaning the government can borrow at interest rates that are less than zero in real terms. Why doesn’t anyone ask Gideon why he isn’t taking full advantage of these amazingly favourable opportunities?

This is the kind of investment that creates real jobs. You don’t create jobs by bullying people on benefits into work that doesn’t exist, Gideon! Here are a few more examples of where public sector jobs would benefit the economy as a whole:

It has been estimated that over a million ‘climate jobs’ could be created if the government was serious about tackling both climate change and unemployment – these would include areas like housing, renewable energy and public transport investment including high speed rail, bus networks and electric car manufacture.

Much of the country outside of London also needs huge investment in bus services – and, just as we should invest in electric car technology, we should also invest in electric buses and tram networks.

Only 2.2% of UK energy comes from renewable sources compared with 8.9% in Germany, 11% in France, and an impressive 44.4% in Sweden. If we are committed to tackling climate change and ensuring domestic energy security there needs to be investment in renewable energy technology.

Are you going to mention any of those in your Autumn Statement, Gideon?

I think not.