Tag Archives: workless

Iain Duncan Smith’s new plan to prolong child poverty

130617childpoverty

Iain Duncan Smith wants to talk about child poverty – but how can we take him seriously when he starts the discussion with a lie?

“Recent analysis reveals that children are three times as likely to be in poverty in a workless family and there are now fewer children living in workless households than at any time since records began, having fallen by 274,000 since 2010,” according to the Department for Work and Pensions’ press release on the new consultation.

Oh really?

According to the Joseph Rowntree Foundation (JRF), child poverty will rise from 2.5 million to 3.2 million during the 2010-2015 Parliament – around 24 per cent of all the children in the UK. By 2020, if the rise is not stopped, it will increase to four million – around 30 per centof all children in the UK.

Under the Coalition government, the number of people in working families who are living in poverty – at 6.7 million – has exceeded the number in workless and retired families who are in poverty – 6.3 million – for the first time.

The Joseph Rowntree Foundation has measured poverty, using several indicators, for more than 15 years; its figures are far more likely to be accurate than those of the government, which is still defining poverty as an income of less than 60 per cent of median (average) earnings. Average earnings are falling, so fewer people are defined as being in poverty – but that doesn’t make the money in their pockets go any further.

“The previous government’s target to halve child poverty by 2010 was not achieved,” states the DWP press release. Then it comes out with more nonsense: “The government is committed to ending child poverty in the UK by 2020 and the draft child poverty strategy sets out the government’s commitment to tackle poverty at its source.” From the JRF figures alone, we know that government policy is worsening the situation – or has everyone forgotten that 80,000 children woke up homeless last Christmas morning?

shame

Let’s look at the government’s plans.

The DWP claims “reforming the welfare system through Universal Credit… will lift up to 300,000 children out of poverty, and cover 70 per cent of childcare costs for every hour worked”. But we know that Universal Credit is effectively a benefit cut for everyone put onto it; they won’t get as much as they do on the current benefits, and the one per cent uprating limit means falling further into poverty every year. Also, we found out this week that the housing element will be subject to sanctions if people in part-time jobs cannot persuade their employers to give them more hours of work. The claim is ridiculous.

The DWP claims the government will will increase investment in the Pupil Premium, provide free school meals for all infant school children from September this year, improve teacher quality, fund 15 hours of free early education places per week for all three- and four-year-old children and extend 15 hours of free education and care per week to two-year-olds from low income families. None of these measures will do anything to “tackle poverty at its source”. Tackling poverty at its source means ending the causes of poverty, not putting crude metaphorical sticking-plasters over the effects – which could be removed at any time in the future.

The DWP claims the government will cut tax for 25 million people by increasing the personal tax allowance, and cut income tax for those on the minimum wage by almost two-thirds. This means people will have more money in their pocket – but will it be enough, when benefit cuts and sanctions are taken into account? Will their pay increase with the rate of inflation? There is no guarantee that it will. And this move means the government will collect less tax, limiting its ability to provide services such as poverty-reduction measures.

The DWP claims the government will reduce water and fuel costs, and attack housing costs by building more homes. The first two measures may be seen as responses to aggressive policy-making by the Labour Party, and the last will only improve matters if the new dwellings are provided as social housing. Much of the extra spending commitment is made for 2015 onwards, when the Conservative-led Coalition may not even be in office.

These are plans to prolong poverty, not end it.

It is notable that the DWP press release repeats many of the proposals in an attempt to pretend it is doing more. Take a look at the list and count for yourself the number of times it mentions fuel/energy bills (three times) and free school meals (twice).

In fact, the only measures that are likely to help reduce the causes of poverty are far down the list: Increasing access to affordable credit by expanding credit unions and cracking down on payday lending (at the very bottom – and we’ll have to see whether this really happens because payday lenders are generous donors to the Conservative party); and reviewing – mark that word, ‘reviewing’ – the national minimum wage, meaning that the government might increase the minimum wage in accordance with Low Pay Commission recommendations.

The DWP press release quotes Iain Duncan Smith, who said the consultation re-states the government’s commitment to tackle poverty at its source, “be it worklessness, family breakdown, educational failure, addiction or debt”.

The measures he has proposed will not improve anybody’s chance of finding a job, nor will they prevent family breakdown, or addiction. The plans for education have yet to be tested and may not work. The plan for debt involves annoying Conservative Party donors.

The JRF has responded to the consultation diplomatically, but there can be no mistaking the impatience behind the words of Chris Goulden, head of poverty research. He said: “Given that it has been over a year since the initial consultation on child poverty measures, we are disappointed that the government is now going to take even longer to agree what those indicators will be.

“With one in four families expected to be in poverty by 2020, a renewed strategy to address child poverty is vital. Any effective strategy should be based on evidence and contain measures to reduce the cost of living and improve family incomes. However, until those measures are agreed, it is difficult to see how the government can move forward.”

Don’t be too concerned about moving forward, Chris.

This government is backsliding.

Follow me on Twitter: @MidWalesMike

Join the Vox Political Facebook page.

Vox Political needs your help!
This independent blog’s only funding comes from readers’ contributions.
Without YOUR help, we cannot keep going.
You can make a one-off donation here:

Donate Button with Credit Cards

Alternatively, you can buy Vox Political books!
The second – Health Warning: Government! is now available
in either print or eBook format here:

HWG PrintHWG eBook
The first, Strong Words and Hard Times
is still available in either print or eBook format here:

SWAHTprint SWAHTeBook

The benefit debate is a diversion – that’s why it will go on and on

140218benefitstreet

How many of you tuned into the last episode of Benefits Street on Channel 4, and stayed on for the debate that followed?

Quite a few, I reckon.

They were worth watching, but the feeling that was left with this viewer (and I’ve been reviewing television for 20 years or more) is that we are talking ourselves around in circles – led by politicians with a vested interest in perpetuating the discussion.

They don’t want a solution. They want us to keep going over the same ground – which they have laid out for us with very specific limits – and they want to concentrate our anger about this issue so that we blame, not the people responsible – the tax dodgers who put money into tax havens that could be invested in British industry, the private landlords and low-paying bosses who are subsidised by the benefit system and the bankers who caused the economic crisis a few years ago – but the people who have been forced onto benefits through no fault of their own and are being persecuted for it by a punitive system that penalises them for failing to find jobs that really do not exist.

Look at the way David Cameron leapt forward with fistfuls of cash to pay for flood relief when Tory heartlands were affected, saying that money was no object and Britain is a rich country. We’re rich enough to look after the playing fields of Eton, but not our poorest citizens, according to his mentality. Property is worth more to him than people.

Why? Because the people who send their children to Eton are the people Cameron hopes will elect him (he can’t be re-elected; he didn’t win the 2010 election) in 2015. The unemployed are less likely to vote for him – in fact they are less likely to vote at all. It seems there is something about being rejected by society that instils a sense of listlessness and despair in the human psyche. People ask themselves: Why bother?

There are solutions, but it is cause for concern that we are not hearing about them from our MPs and politicians. Journalist Owen Jones came out with the clearest plan during the debate on Channel 4 last night, and it is well worth quoting in full.

He said: “Firstly let’s make it clear – work does not pay in this country. We hear that as a mantra, when most people in poverty get up in the morning and earn that poverty.

“We’re talking about people milking the system. Let’s talk about the low-paying bosses who are being subsidised with in-work benefits because, in the seventh-richest country on Earth, they won’t pay.

“If we’re talking about getting people into jobs I actually think we need to talk about solutions here. One in six workers in the last two years have claimed Jobseekers’ Allowance at some point; that’s a lack of security.

“What we need firstly is a massive house-building programme that would reduce the amount spent on Housing Benefit which, by the way, is not going into the pockets of these tenants – it’s lining the pockets of private landlords charging rip-off rents. If we build housing, it would create jobs and we would stimulate the economy as well.

“It goes the same with the need for an industrial strategy because what successive governments have done, and it started in the eighties, is let the secure jobs go to rot, if you like. Now, other countries like Germany, what they’ve done is had an industrial strategy. Instead of saying, ‘Hands off, let the market decide,’ they’ve said, ‘Actually we want to create jobs in renewable energy.’ Now we’ve just seen the floods; we’re going to have a lot more extreme weather, so let’s have an industrial strategy to go and create renewable energy jobs, giving people secure, dignified jobs, taking on the environmental crisis.

“These are solutions… We’ve got to change the debate we have at the moment where the real villains of the piece, like the tax dodgers who get away with not paying £25 billion a year in tax, like the private landlords and the low-paying bosses milking our welfare state, like the bankers who caused the economic disaster – they get away with it, but all we ever hear about is kicking people at the bottom.”

Absolutely right. And that’s all we’ll hear about it for the foreseeable future, as well. We won’t hear about returning to a full-employment society (which is perfectly possible), because that means the greedy rich will have less money for themselves in the short term.

In the long term, ensuring that there are properly-paid jobs for the most people, so they do not have to claim benefits, means that there is more money moving around the economy – and money makes money. The parasites – who are making a fortune unsustainably by working people hard and paying them poverty rations – would be just as rich in the long run, but they cannot bear to consider the possibility.

One has to consider whether they want to force people into poverty, just to make their own wealth seem more remarkable – the poverty trap as ego-trip, if you like.

But we won’t hear about that because it is politically inflammatory. Far better to set the lower classes against each other, laying blame on each other for problems that are caused by different people entirely – and laugh all the way to the offshore bank.

If I had to describe Britain to a foreigner, I would ask them to imagine a person being robbed outside a public lavatory, by the mayor of his town, while council workers started demolishing the building; the rich are destroying our public services and mugging us at the same time.

Very soon, the same people who are mugging you will be asking for your vote…

… while blaming you for problems they have done nothing to solve.

Follow me on Twitter: @MidWalesMike

Join the Vox Political Facebook page.

Vox Political strives to stand on its own merits.
But the site needs funds if it is to carry on.
Vox Political cannot continue without YOUR help.
You can make a one-off donation here:

Donate Button with Credit Cards

Alternatively, you can buy the first Vox Political book,
Strong Words and Hard Times
in either print or eBook format here:

SWAHTprint SWAHTeBook

Divisions in Coalition as MPs demand independent inquiry on poverty

130617childpoverty

Calls for a ‘commission of inquiry’ into the impact of the government’s changes to social security entitlements on poverty have won overwhelming support from Parliament.

The motion by Labour’s Michael Meacher was passed with a massive majority of 123 votes; only two people – David Nuttall and Jacob Rees-Mogg – voted against it.

The debate enjoyed cross-party support, having been secured by Mr Meacher with Sir Peter Bottomley (Conservative) and John Hemming (Liberal Democrat).

Introducing the motion, Mr Meacher said: “It is clear that something terrible is happening across the face of Britain. We are seeing the return of absolute poverty, which has not existed in this country since the Victorian age more than a century ago. Absolute poverty is when people do not have the money to pay for even their most basic needs.”

He said the evidence was all around:

  • There are at least 345 food banks and, according to the Trussell Trust, emergency food aid was given to 350,000 households for at least three days in the last year.
  • The Red Cross is setting up centres to help the destitute, just as it does in developing countries.
  • Even in prosperous areas like London, more than a quarter of the population is living in poverty.
  • According to the Joseph Rowntree Foundation, for the first time, the number of people in working families who are living in poverty, at 6.7 million, is greater than the number of people in workless and retired families who are living in poverty, at 6.3 million.
  • Child poverty will rise from 2.5 million to 3.2 million during this Parliament, around 24 per cent of children in the UK. By 2020, if the rise is not stopped, it will increase to four million – around 30 per cent of children in the UK.
  • The use of sanctions depriving people of all their benefits for several weeks at a time, had increased by 126 per cent since 2010 and 120 disabled people who had been receiving jobseeker’s allowance had been given a three-year fixed duration sanction in the previous year.
  • There are now more than 2,000 families who have been placed in emergency bed-and-breakfast accommodation after losing their homes.
  • The per cent rise in the overall homelessness figures last year included nearly 9,000 families with children, which is the equivalent of one family losing their home every 15 minutes.
  • A third of families spent less than £20 a week on food and that the average spend on food per person per day was precisely £2.10. That is a third less than those families were able to afford three months before that.
  • The proportion of households that had to make debt repayments of more than £40 a week had doubled and the average level of debt was £2,250.
  • A third of families had council tax debt.
  • 2.7 million people had lost out through the Government’s changes to council tax benefit – many of them disabled people, veterans and some of the most vulnerable in our communities.
  • Households were having to spend 16 per cent more on gas and electricity.
  • There are 2.5 million people who have been unemployed for the best part of two years, and there were 562,000 vacancies when the debate took place (Monday), so four out of five of those who are unemployed simply cannot get a job whatever they do.
  • Cuts to local authorities mean many home care visits are limited to 15 minutes.
  • The 10 per cent of local authorities that are the most deprived in the country face cuts six times higher than those faced by the 10 per cent that are the most affluent.
  • 60 per cent of benefit cuts fall on those who are in work.

Mr Meacher said the biggest cause of absolute poverty was the huge rise in sanctioning, often for trivial reasons such as turning up five minutes late for a job interview or the Work Programme:

  • A dyslexic person lost his Jobseekers Allowance because his condition meant that in one fortnightly period he applied for nine jobs, not 10. He was trying to pay his way and already had work, but it provided only an extremely low income.
  • The jobcentre didn’t record that a claimant had informed them that he was in hospital when he was due to attend an appointment and he was sanctioned.
  • A claimant went to a job interview instead of signing on at the jobcentre because the appointments clashed – and was sanctioned.
  • A claimant had to look after their mother who was severely disabled and very ill – and was sanctioned.
  • A Job Centre sent the letter informing a claimant of an interview to their previous address, despite having been told about the move. The claimant was sanctioned.
  • A claimant was refused a job because she was in a women’s refuge, fleeing domestic violence and in the process of relocating, but I was still sanctioned.

Mr Meacher also quoted what he called a classic: “I didn’t do enough to find work in between finding work and starting the job.”

The latest DWP figures suggest that more than one million people have been sanctioned in the past 15 months and deprived of all benefit and all income. “Given that the penalties are out of all proportion to the triviality of many of the infringements, and given that, as I have said, four out of five people cannot get a job whatever they do, the use of sanctioning on this scale, with the result of utter destitution, is — one struggles for words — brutalising and profoundly unjust,” said Mr Meacher.

Other reasons for the rise in absolute poverty included:

  • Delays in benefit payments.
  • The fact that it is impossible for many poor and vulnerable people to comply with new rules – for example a jobseeker who asked to downsize to a smaller flat who was told he must pay two weeks’ full rent upfront before getting housing benefit. He does not have the funds to do so and is stuck in a situation where his benefits will not cover his outgoings due to the Bedroom Tax.
  • The Bedroom Tax, which applies to around 667,000 households, and two-thirds of those affected are disabled. More than 90 per cent of those affected do not have smaller social housing to move into.
  • The Benefit Cap, imposed on a further 33,000 households.
  • Mistakes by the authorities; up to 40,000 working-age tenants in social housing may have been improperly subjected to the Bedroom Tax because of DWP error (although Iain Duncan Smith claims a maximum of 5,000).

Mr Meacher said: “The Chancellor’s policy of keeping 2.5 million people unemployed makes it impossible for them to find work, even if there were employers who would be willing to take them, and the 40 per cent success rate of appeals shows how unfair the whole process is.”

Responding to a comment from David TC Davies (Conservative) that those who are not looking for work must realise there will be consequences, particularly when a million people have been able to come to the UK from eastern Europe and find work, Mr Meacher said, “Those who come to this country are more likely to be employed and take out less in benefits than many of the indigenous population.”

He asked: “Is all this brutality towards the poor really necessary? Is there any justification in intensifying the misery, as the Chancellor clearly intends, by winding up the social fund and, particularly, by imposing another £25 billion of cuts in the next Parliament, half of that from working-age benefits?

“After £80 billion of public spending cuts, with about £23 billion of cuts in this Parliament so far, the deficit has been reduced only at a glacial pace, from £118 billion in 2011 to £115 billion in 2012 and £111 billion in 2013. Frankly, the Chancellor is like one of those first world war generals who urged his men forward, over the top, in order to recover 300 yards of bombed-out ground, but lost 20,000 men in the process. How can it be justified to carry on imposing abject and unnecessary destitution on such a huge scale when the benefits in terms of deficit reduction are so small as to be almost derisory?”

Suggested alternatives to the punitive austerity programme of cuts came thick and fast during the debate. Challenged to explain what Labour’s Front Bench meant by saying they would be tougher on welfare than the Tories, Mr Meacher said: “As the shadow Chancellor has made clear on many occasions, is that we need public investment. We need to get jobs and growth. That is the alternative way: public investment in jobs, industry, infrastructure and exports to grow the real economy, not the financial froth, because that would cut the deficit far faster than the Chancellor’s beloved austerity.”

He asked: “How about the ultra-rich — Britain’s 1,000 richest citizens — contributing just a bit? Their current remuneration — I am talking about a fraction of the top 1 per cent — is £86,000 a week, which is 185 times the average wage. They received a windfall of more than £2,000 a week from the five per cent cut in the higher rate of income tax, and their wealth was recently estimated by The Sunday Times at nearly half a trillion pounds. Let us remember that we are talking about 1,000 people. Their asset gains since the 2009 crash have been calculated by the same source at about £190 billion.

“These persons, loaded with the riches of Midas, might perhaps be prevailed upon to contribute a minute fraction of their wealth in an acute national emergency, when one-sixth of the workforce earns less than the living wage and when one million people who cannot get a job are being deprived of all income by sanctioning and thereby being left utterly destitute.

“Charging the ultra-rich’s asset gains since 2009 to capital gains tax would raise more than the £25 billion that the Chancellor purports to need. I submit that it would introduce some semblance of democracy and social justice in this country if the Chancellor paid attention to this debate and thought deeply about what he is doing to our country and its people.”

Ronnie Campbell (Blyth Valley, Lab) suggested that the Government might save a lot more if its members “showed the same energy and enthusiasm for getting those who evade their taxes and run to tax havens as they do for going after the poor, the sick and people on the dole”.

Against this, David TC Davies offered insults and distortions of the facts, quoting the Daily Mail as though it provided an accurate account of current events: “Members of the shadow Cabinet might need a boxing referee to sort out their disputes at the moment, as we read today in the Daily Mail.”

He said: “We took office with a deficit of £160 billion and a debt that was rising rapidly to £1 trillion. That was after years of overspending in good times, as well as in bad, by Labour, a cheap money supply and lax banking regulation under the former Government.” Labour’s spending, up until the financial crisis, was always less than that of the previous Conservative administration; Gordon Brown and Tony Blair both ran a lower deficit than John Major and Margaret Thatcher, and at one point actually achieved a surplus, which is something that the Conservatives had not managed in the previous 18 years. While Mr Davies here complained about the “lax banking regulation”, Conservatives supported it at the time and in fact demanded more DE-regulation, which would have made the financial crisis worse when it happened.

“We had disastrous economic decisions, such as that to sell gold at a fraction of its real rate,” said Mr Davies. Yes – the UK lost around £9 billion. But compare that with the disastrous economic decision by George Osborne to impose more than £80 billion worth of cuts to achieve a £7 billion cut in the national deficit. The UK has lost £73 billion there, over a three-year period.

And Mr Davies said: “Worst of all and most seriously, we had a welfare system that allowed people to get into a trap of welfare dependency, leaving them on the dole for many years, but at the same time filling the consequent gap in employment by allowing mass and uncontrolled immigration into this country, which completely undercut British workers.” The first assertion is simply untrue; the second is a legacy of previous Conservative administrations that agreed to the free movement of EU member citizens, meaning that, when the eastern European countries joined in 2004, citizens migrated to the UK in the hope of a better life. Labour has admitted it should have negotiated for a delay in free movement until the economies of those countries had improved, making such migration less likely, but the situation was created before Labour took office.

Challenged on the Coalition’s record, Mr Davies fell back on the Tories’ current trick question, which is to counter any criticism by asking: “Is he suggesting that we are not doing enough to pay down the national debt? Is he suggesting that we should cut further and faster? If so, and if we had the support of other Opposition Members, that is exactly what the Government could do and, indeed, possibly should do. I look forward to seeing that support for getting the deficit down.” This disingenuous nonsense was batted away by Labour’s Hugh Bayley, who said “investing in the economy, creating jobs and thereby getting people off welfare and into work” was the way forward.

Mr Davies’ Conservative colleague Jeremy Lefroy took a different view, agreeing that increasing numbers of people are finding it impossible to make ends meet, and that job creation and apprenticeships were a better way out of poverty than changing the social security system alone. He agreed that sanctions were applied to his constituents “in a rather arbitrary manner”. He spoke against George Osborne’s suggested plan to remove housing benefits from people aged under 25, saying this “would have a drastic impact on young people who need to live away from home and who have no support from their families”. He spoke in favour of councils increasing their housing stock. And he admitted that disabled people faced severe problems when unfairly transferred from ESA to JSA: “A lady in my constituency says, ‘I am simply not fit for work, but by signing on for JSA I have to say that I am available and fit for work.’ She does not want to tell a lie.”

Steve Rotheram (Liverpool Walton, Labour) spoke powerfully about the effect of being on benefits: “Lots of people in my city are on benefits for the very first time. Far from being in clover — it beggars belief what we read in the right-wing press — they are struggling to make ends meet, and the problem that thousands of Liverpudlians are facing is new to them. For many, the idea that they might miss a rent payment is totally alien. They have not done that in the past 20 years, but since May 2010, their individual household incomes have been on such a downward trajectory that they now find themselves in rent arrears, seeking advice on debt management and unable to afford the daily cost of travel, food and energy. Figures suggest that 40 per cent of the adult population in Liverpool are struggling with serious debt problems.”

And he said poverty had health implications, too: “David Taylor-Robinson of the University of Liverpool and his fellow academics have highlighted the doubling of malnutrition-related hospital admissions nationally since 2008.”

John Hemming (Birmingham Yardley, LD) raised concerns about “the interrelationship between the welfare cap and victims of domestic violence, and whether there are situations that need more attention. I believe that people can get discretionary housing payment to leave a violent home, but it is important that we ensure that there is a route out of domestic violence for women. I am worried about that issue, just as I am about some wrongful sanctioning that I have seen. That does not help at all, because it undermines the whole process.” He also called for “a substantial increase in the minimum wage, because as the economy is improving the Government should look at that, rather than maintain things as they are”.

The vote gave huge endorsement to the call for an independent inquiry into poverty under the Coalition.

But with an election just 15 months away, how long will we have to wait for it to report?

Show your support for Vox Political!
The site needs YOUR help to continue.
You can make a one-off donation here:

Donate Button with Credit Cards

Alternatively, you can buy the first Vox Political book,
Strong Words and Hard Times
in either print or eBook format here:

SWAHTprint SWAHTeBook

The benefit cap reveals the black centre of IDS’ mind

130715benefitcap

The long-feared roll-out of the benefit cap happened today. There has been a great deal of shouting about it from all sides, but it is possible to get a balanced view – by linking news articles from opposing sources such as, say, New Statesman, the BBC and the Daily Mail.

Yes, the Daily Mail. I’m serious.

The benefit cap is one of the Coalition’s most popular policies – not the ONLY popular policy; believe it or not, a sizeable proportion of the population think Cameron and Co are doing a good job. New Statesman quotes a YouGov poll in which 79 per cent of people, including 71 per cent of Labour voters, support the cap – with just 12 per cent opposed. The Mail quotes Ipsos Mori, whose poll states 74 per cent support the cap.

We’ll start with the Statesman, which gives us the facts that Iain Duncan Smith – architect of the policy – won’t want people to know:

“1. An out-of-work family is never better off than an in-work family

The claim on which the policy rests – that a non-working family can be better off than a working one – is a myth since it takes no account of the benefits that an in-work family can claim to increase their income. For instance, a couple with four children earning £26,000 after tax and with rent and council tax liabilities of £400 a week is entitled to around £15,000 a year in housing benefit and council tax support, £3,146 in child benefit and more than £4,000 in tax credits.

“Were the cap based on the average income (as opposed to average earnings) of a working family, it would be set at a significantly higher level of £31,500. The suggestion that the welfare system “rewards” worklessness isn’t true; families are already better off in employment. Thus, the two central arguments for the policy – that it will improve work incentives and end the “unfairness” of out-of-work families receiving more than their in-work equivalents – fall down.

“Contrary to ministers’ rhetoric, the cap will hit in-work as well as out-of-work families. A single person must be working at least 16 hours a week and a couple at least 24 hours a week (with one member working at least 16 hours) to avoid the cap.

“2. It will punish large families and increase child poverty

The cap applies regardless of family size, breaking the link between need and benefits. As a result, most out-of-work families with four children and all those with five or more will be pushed into poverty (defined as having an income below 60 per cent of the median income for families of a similar size). Duncan Smith has claimed that “at £26,000 a year it’s very difficult to believe that families will be plunged into poverty” but his own department’s figures show that the poverty threshold for a non-working family with four children, at least two of whom are over 14, is £26,566 – £566 above the cap. The government’s Impact Assessment found that 52 per cent of those families affected have four or more children.

By applying the policy retrospectively, the government has chosen to penalise families for having children on the reasonable assumption that existing levels of support would be maintained. While a childless couple who have never worked will be able to claim benefits as before (provided they do not exceed the cap), a large family that falls on hard times will now suffer a dramatic loss of income. It was this that led the House of Lords to vote in favour of an amendment by Church of England bishops to exclude child benefit from the cap (which would halve the number of families affected) but the defeat was subsequently overturned by the government in the Commons.

“The DWP has released no official estimate of the likely increase in child poverty but a leaked government analysis suggested around 100,000 would fall below the threshold once the cap is introduced.

“3. It will likely cost more than it saves

“For all the political attention devoted to it, the cap is expected to save just £110m a year, barely a rounding error in the £201bn benefits bill. But even these savings could be wiped out due to the cost to local authorities of homelessness and housing families in temporary accommodation. As a leaked letter from Eric Pickles’s office to David Cameron stated, the measure “does not take account of the additional costs to local authorities (through homelessness and temporary accommodation). In fact we think it is likely that the policy as it stands will generate a net cost. In addition Local Authorities will have to calculate and administer reduced Housing Benefit to keep within the cap and this will mean both demands on resource and difficult handling locally.”

“4. It will increase homelessness and do nothing to address the housing crisis

“Most of those who fall foul of the cap do so because of the amount they receive in housing benefit (or, more accurately, landlord subsidy) in order to pay their rent. At £23.8bn, the housing benefit bill, which now accounts for more than a tenth of the welfare budget, is far too high but rather than tackling the root of the problem by building more affordable housing, the government has chosen to punish families unable to afford reasonable accommodation without state support.

“The cap will increase homelessness by 40,000 and force councils to relocate families hundreds of miles away, disrupting their children’s education and reducing employment opportunities (by requiring them to live in an area where they have no history of working).

“5. It will encourage family break-up

Duncan Smith talks passionately of his desire to reduce family breakdown but the cap will serve to encourage it. As Simon Hughes has pointed out, the measure creates “a financial incentive to be apart” since parents who live separately and divide the residency of their children between them will be able to claim up to £1,000 a week in benefits, while a couple living together will only be able to claim £500.”

The BBC opened with a much sunnier perspective that has caused Vox Political to send a query to the UK Statistics Authority.

According to the report, “More than 12,000 people have moved into work after being told about the benefits cap, the government says.” Oh, really?

“The Department of Work and Pensions (DWP) said that 12,000 claimants have found jobs over the last year, after being contacted by job centres,” the BBC report went on. “The job centres warned them they might have their benefits capped if they did not find employment.”

Didn’t Iain Duncan Smith get into trouble only a few months ago, for reporting that 8,000 people had moved into work after being told about the cap?

Only last week, his own officials told the Work and Pensions committee he had ignored small print in their reports, stating clearly that he could not use the figures to claim that any “behavioural change” had taken place.

Vox‘s article last week quoted Dame Anne Begg, who asked: “So no-one checking the written articles from the Secretary of State – from the statisticians’ point of view – actually said ‘Secretary of State – if you look at the little footnote… It says that you cannot interpret that these people have gone into work as a result of these statistics’. Nobody pointed that out?“

John Shield, Director of Communications at the DWP, responded: “In this instance it did involve the press office. I’m just trying to be clear that not everything that comes out of the department will go through us – particularly when there are political ends.”

In other words, the Secretary of State ignored his advisors to make a political point that had no basis in fact. He lied to the public.

How do we know he isn’t doing it again?

A letter to Mr Dilnot is in order, I think.

Finally, to the Daily Mail, where it was reported that “Cabinet minister Iain Duncan Smith today accused the BBC of launching a ‘politically-motivated’ attack on government plans to cap benefits at £26,000.

“The Work and Pensions Secretary accused the Corporation of using ‘lots of little cases’ to claim that limiting welfare payments would not get people back to work.”

Unfortunately for Mr… Smith, his story unravelled further down the piece, when it was revealed that he told the nation that HIS evidence is right because it’s from people working in Jobcentres: “This is advisers, they talk to me… I talk to people actually in the Jobcentres.”

That’s anecdotal, and may not be used to suggest a national trend. He is using lots of little cases to claim that his cap will work.

So we go from the cold, hard facts, to the comforting fantasy, to the shattering of the Secretary-in-a-State’s temper on national radio when the flaws in his scheme were exposed.

Mail readers, in that paper’s ‘comment’ column, seem to have supported his viewpoint – despite the facts.

Will their opinions change when the horror stories start appearing – or will they stick their fingers in their ears and scream, “La la la I’m not listeniiiiiing!” – as Mr… Smith did (figuratively speaking) on the Today programme?

Follow me on Twitter: @MidWalesMike

Join the Vox Political Facebook page.

Vox Political needs your help!
This independent blog’s only funding comes from readers’ contributions.
Without YOUR help, we cannot keep going.
You can make a one-off donation here:

Donate Button with Credit Cards

Alternatively, you can buy Vox Political books!
The second – Health Warning: Government! is now available
in either print or eBook format here:

HWG PrintHWG eBook
The first, Strong Words and Hard Times
is still available in either print or eBook format here:

SWAHTprint SWAHTeBook

Iain Duncan Smith’s most shocking statistical lie yet: Child poverty

Still poor despite the statistics: IDS and his DWP spin-doctors need to get something clear - children haven't stopped becoming poor, just because of a skewed set of statistics. Incomes have dropped - meaning MORE children are in poverty than before.

Still poor despite the statistics: IDS and his DWP spin-doctors need to get something clear – children haven’t stopped becoming poor, just because of a skewed set of statistics. Incomes have dropped – meaning MORE children are in poverty than before.

According to a TUC report, average wages have dropped by 7.5 per cent since the Coalition came into office. This has a direct impact on child poverty statistics, which the government has conveniently ignored in its latest, Iain Duncan Smith-endorsed, child poverty figures.

Child poverty is calculated in relation to median incomes – the average income earned by people in the UK. If incomes drop, so does the number of children deemed to be in poverty, even though – in fact – more families are struggling to make ends meet with less money to do so.

This is why the Department for Work and Pensions has been able to trumpet an announcement that child poverty in workless families has dropped, even though we can all see that this is nonsense. As average incomes drop, the amount received by workless families – taken as an average of what’s left – appears to rise, even though, as we know, the increase is not even keeping up with inflation any more.

The problem lies in proving it.

Let’s do a rough calculation. In 2007-8, Jobseekers’ Allowance for a couple with at least one person over 18 was £92.80 per week (£4,839 per year). It is now £111.45 per week (5,811 per year) – an increase of 20 per cent in real money (not inflation-adjusted). In the same period, average earnings for those in employment rose from £26,020 per year (according to the Office for National Statistics’ Annual Survey of Hours and Earnings (ASHE)) to £26,500 – the figure we all know from the government’s calculation of its benefit cap). That’s an increase of just 1.8 per cent.

This doesn’t mean unemployed people are receiving too much – it means wages are being pushed down, as the TUC report shows. They are only ‘scratch’ figures – accurate data was impossible to find on the Internet this morning – but they show that JSA as a percentage of average wages has risen from 18.6 per cent to 21.9 per cent (roughly).

So workless income has risen in relation to the national average, meaning that child poverty in this sector appears to have dropped.

Alternatively, you could just use your common sense: People on benefit are not well-off, especially under a Conservative or Tory-led government.

The government’s figures don’t take 2007-8 – the year incomes began to drop – as their baseline figure. “To keep the absolute measure more in line with contemporary living standards” they use 2010-11 as the baseline. Incomes had already begun to drop by then, meaning the figures are misleading. In fairness, the press release does state that “you cannot compare this year’s published figure with last year’s” because of that change.

What this means is that the DWP’s press release about child poverty is utterly worthless. Let’s look at it anyway. It says:

“New annual poverty statistics (households below average income) out today, show how the number of children in workless poor families has reduced by 100,000 children over the past year (a two percentage point reduction).” While correct within its frame of reference, in comparison with previous income averages, this must be wrong.

“The statistics for relative poverty – the most commonly used poverty line – also show that the most vulnerable groups have been protected as pensioner poverty fell by 100,000, disability poverty by 100,000 and child poverty stayed the same.” Wrong.

“The number of children in absolute child poverty has increased by 300,000.” Wrong.

“Work remains the best route out poverty – these statistics show how children in workless households are around three times more likely to be in poverty than those in working families.” Absolutely wrong!

How can the last claim be correct? If the number of children in workless poor families has dropped by 100,000 but the total in poverty has risen by 300,000, that’s an extra 400,000 children belonging to working families who have fallen into poverty – by this government’s own figures!

Out comes Iain Duncan Smith with his latest lie: “We have successfully protected the poorest from falling behind and seen a reduction of 100,000 children in workless poor families.” Shockingly wrong!

Let’s get some sanity from the Huffington Post and Metro: “Some 2.3 million children were recorded as living in relative poverty between 2011 and 2012, in official government statistics,” the HuffPost reported. Interestingly, this compares with a Metro report claiming 3.8 million were in ‘absolute’ poverty (which is a statistical measurement, not a statement about how poor they actually are). Metro goes on to say this means more than one in six children are in relative poverty.

“Two out of three children living in poverty, 66 per cent, are now from working families. This has risen from 43 per cent in 1996-1997 and and amounts to 1.5 million children, according to analysis of the figures by the Resolution Foundation,” says the HuffPost.

“The proportion of children in poverty from working families has risen sharply since the start of the financial crisis in 2008.” In other words, Iain Duncan Smith and the DWP have lied again.

“Poverty is calculated by households living with less than 60 per cent of median average disposable income, compiled by the Department for Work and Pensions. But statistics have been skewed because of the fall in wages. If the number was calculated using average household income from the previous year, the number of children in poverty rises by 300,000.” This confirms the argument I am putting forward.

Oxfam and Barnardo’s have both criticised the government over the figures.

And Fiona Weir, chief executive of single-parent charity Gingerbread, said in the HuffPost: “Government claims that work is the best route out of poverty are simply not ringing true.”

The Government has a legal responsibility, under the Child Poverty Act of 2010 (passed by Gordon Brown’s Labour government), to reduce relative child poverty to below 10 per cent by 2020.

While Iain Duncan Smith has expressed frustration with the current method of defining poverty, it seems his government is determined to achieve that target by reducing incomes so much that nobody will be in ‘relative’ poverty…

… but across the nation’s working people, real poverty will be absolute.

Follow me on Twitter: @MidWalesMike

Join the Vox Political Facebook page.

Vox Political needs your help!
This independent blog’s only funding comes from readers’ contributions.
Without YOUR help, we cannot keep going.
You can make a one-off donation here:

Donate Button with Credit Cards

Alternatively, you can buy Vox Political books!
The second – Health Warning: Government! is now available
in either print or eBook format here:

HWG PrintHWG eBook
The first, Strong Words and Hard Times
is still available in either print or eBook format here:

SWAHTprint SWAHTeBook