The phoney debate over Universal Credit

The government’s flagship welfare reform, Universal Credit, looks to be in serious trouble. It was intended to simplify the social-security system to help welfare claimants into work, but is instead charged with causing them even more hardship. It has been beset by problems, from controversies over an eye-wateringly over-budget (and subsequently abandoned) IT system to delayed payments to the excessive use of sanctions.

Some Tories have threatened to rebel against the government in parliament unless the Treasury finds more funding for it in the Budget this month. The BBC reports that ministers are bowing to the pressure, and planning to delay the rollout once again.

There are ample reasons to criticise the Tories’ handling of this. It is projected that 1.1million households could gain £53 per week as a result of the introduction of Universal Credit, but as many as 3.2million could lose £48 per week. The impact of the introduction of Universal Credit on those dependent on benefits is real enough, not least as over a quarter of claims fail for one reason or another.

But the debate is phoney. Leftish commentators have been complaining about how awful Universal Credit is since it was first introduced by Iain Duncan Smith back in 2013, when he was work and pensions secretary. And yet they lack any substantive arguments against it, never mind any alternative proposals. After months of merely saying it would ‘review’ Universal Credit, the Labour Party for a moment suggested it would scrap it, but has now backtracked once again.

The Universal Credit row has also become a proxy for the Tory civil war over Brexit. Brexiteer Duncan Smith openly blames former chancellor and Remain campaign leader George Osborne for Universal Credit’s woes: Osborne raided the £2 billion of funding that, Duncan Smith claims, would have made all the difference. Meanwhile, former prime minister John Major, another vocal Remainer, has compared the Universal Credit debacle to the poll tax.

But as badly designed, implemented and funded as Universal Credit no doubt is, we shouldn’t just discard the ideas that underpinned it. Iain Duncan Smith’s ‘better benefit’ was intended to ensure that people aren’t penalised for moving from welfare to work. There is something to be said for that, even if this technical solution hasn’t matched up to the scale of the welfare problem.

We need a proper debate about welfare, and why so many people are so reliant on it. For all the mock outrage about Universal Credit coming from Labour, the truth is that this new programme, properly implemented, would hardly be any worse than what already exists. Labour, besotted with the status quo, seems suspicious of any attempt to question, let alone do something about, the fact that so many today are so dependent on the state to get by.

First published in spiked

The sorry state of welfare

Universal credit – the Tories’ flagship welfare policy aimed at saving money, easing claimants’ transition into work, and simplifying the benefits system by merging six different benefits into one – has hit headlines recently for all the wrong reasons.

As it has been rolled out, the requirement that claimants wait six weeks or more before receiving payment has, reportedly, led to everything from indebtedness to evictions. And the charge attached to the Department for Work and Pensions (DWP) hotline has caused outrage, too.

Last month, Labour put forward an opposition-day (that is, non-binding) motion calling for the roll-out of universal credit to be halted. It passed 229 to nil. Controversially, Tory MPs were instructed to abstain or absent themselves in an effort to avoid a backbench revolt.

It has been widely reported that the DWP helpline costs 55p per minute, which is hardly affordable for the already hard-up. In fact, the cost varies from 3p to 55p on a mobile, and is no more than 9p on a landline. Nevertheless, it became part of a narrative that the Tory government is being grasping and inhumane.

The Archbishop of York described those being bitten by the roll-out as the ‘present-day successors’ of the widows and orphans referred to in the Bible. Labour MP Frank Field, chair of the Work and Pensions Committee, has said the government must ‘avert a Christmas disaster’. Much of this is overdone, similar to over-the-top claims about food poverty and suicidal benefits claimants. But there are still some real problems with universal credit.

Food banks have been reporting increased demand for some time, and rising homelessness has been linked to welfare reform. The Smith Institute has linked the introduction of universal credit with millions of pounds worth of rent arrears in Southwark and Croydon in south London. And according to SNP MP Drew Hendry, 60 per cent of his constituency caseload is universal-credit-related. He has complained of a ‘systematic lack of care shown to those most vulnerable in our society’.

Universal credit has been beset by delays and controversy from the start. And until recently, it has been rolled out in an almost apologetic way – at the rate of five Job Centres a month. This was due to be accelerated to include all new claimants by autumn 2018, so that it would be fully implemented by 2022 to cover an estimated seven million households. (Such is the extent of the problem of welfare dependency.) But it’s looking unlikely that target will be met.

There have been very real problems with the way in which universal credit has been rolled out. And on these issues, there have been welcome signs of retreat, as a result of the pressure exerted inside and outside of parliament. There’s been a u-turn on a cap for housing benefit for social-housing tenants, a reduction on the six-week wait is expected to be in next month’s budget, and the helpline is now free of charge.

But the principle behind universal credit is a good one, and needs to be defended. The architect of universal credit, former work and pensions secretary Iain Duncan Smith, still maintains that it could ‘dramatically change lives for the better’. This ambition, to reform the welfare system and make it fit for the new century, has unfortunately been bogged down in political point-scoring and design failures.

Welfare dependency is a longstanding social, economic and cultural problem. It will take more than a technical fix to solve it. But at least the Tories recognise there is a problem, and are trying to treat benefits claimants like adults. Under universal credit, claimants receive their benefits directly. (Housing benefit, for example, previously went straight to landlords.) Also, it is paid on a monthly basis, like a salary, instead of fortnightly or weekly. Many of its critics, by contrast, think ‘vulnerable’ claimants are incapable of budgeting for themselves.

Virtue-signalling over the needy may shame the government into another u-turn, but it will do nothing to help claimants. What’s more, the rows over universal credit – a policy that, in principle, all parties support – makes it seem more drastic than it is. It is a policy that is argued for in the language of ‘supporting’ the ‘vulnerable’. A reminder that there’s still a much broader debate to be had about the future of the welfare state.

First published in sp!ked

What’s all the fuss with a Universal Basic Income?

There’s something seductive about a Universal Basic Income. A regular, fixed, unconditional sum of money paid to everyone ‘just for being alive’. Trials are taking place around the world – with Ontario, Canada, announcing one earlier this year and Finland having started their pilot in January.

From left-wing radicals to right-wing libertarians, from so-called socialists to the high-tech billionaires of Silicon Valley – it is an idea with a wide and growing appeal. Labour Leader Jeremy Corbyn and his Shadow Chancellor John McDonnell have both said positive things about UBI, the latter setting up a working group to consider it. Mark Zuckerberg (worth $70 billion) and Richard Branson have also given their support to the idea.

Y Combinator, the Silicon Valley tech incubator with Airbnb and Dropbox in its portfolio, is to run a trial in two US States; following an earlier trial in Oakland, California. Company President Sam Altman, boasting a total valuation of start-ups at around $80 billion, has wider ambitions: ‘Eliminating poverty is such a moral imperative’ he has said of the initiative.

There is long-standing support for UBI. Sir Thomas More in his Utopia (written in 1516) has his narrator say: ‘it would be far more to the point to provide everyone with some means of livelihood, so that nobody’s under the frightful necessity of becoming, first a thief, and then a corpse’. In The German Ideology, written by Karl Marx in 1845, he looks forward to a new society much like the advocates of UBI do:

… where nobody has one exclusive sphere of activity but each can become accomplished in any branch he wishes, society regulates the general production and thus makes it possible for me to do one thing today and another tomorrow, to hunt in the morning, fish in the afternoon, rear cattle in the evening, criticise after dinner, just as I have a mind, without ever becoming hunter, fisherman, herdsman or critic …

There are two important points of difference though between historical advocates of a new society; and today’s champions of a UBI. First, the old idealists had a broad vision of creating a better society than the one they lived in. Those who argue for UBI tend to be driven by fears and anxieties about the world of work, and constrained by a culture of limits that inhibits discussion about how society and the economy might be organised differently. Second, historical materialists like Marx, went beyond More’s utopianism – literally nowhere – to situate their ideals in the real world. It is only because a future society would take care of ‘the general production’ that the individual could be liberated from the daily toil. Today’s advocates of UBI have no plans to expand ‘the general production’ on which such a handout must surely depend. Indeed, many of those arguing the case for UBI are anti-consumption and would rather rein in the general production in the name of a future more ‘sustainable’ than the present.

Advocates though, as I say, are various and have put forward various arguments for the introduction of a UBI. Some are practical – it would be cheaper to administer than the welfare state it is claimed, though it would be impossible to incorporate housing or childcare costs argue others, and depending on its generosity would have implications for immigration policy too. Guy Standing founder of Basic Income Earth Network, wants to reduce inequality and tackle job insecurity and arrest what he describes as the ‘drift to fascist populism’. The Finnish trial is meant to tackle unemployment and avoid the disincentives associated with the welfare trap; though there is trade union opposition, interestingly enough, on the grounds that the introduction of UBI will itself be a disincentive to work. In the context of the UK, changes in the economy, particularly the shift to self-employment and the emergence of a gig economy peopled by a so-called ‘precariat’, make the current welfare arrangements obsolete, it is argued. People tend to drift in and out of low paid work too quickly for it to accommodate to their constantly changing circumstances. In the US, the debate is slightly different but again driven by anxieties about the economy, in particular fears that automation will destroy jobs (keying into wider concerns about national decline).

I wouldn’t ordinarily put Joe Biden, former Vice President, in the company of More and Marx. But as an opponent of Universal Basic Income, next to those who advocate a handout for all, he is the more visionary sounding. ‘Silicon Valley Executives’ he says, are ‘selling American workers short’. Having a job is ‘about your dignity. It’s about your self-respect. It’s about your place in the community’. In this way, ‘[a]ll of us together can make choices to shape a better future’ he says, putting forward at least the idea that people can play an active role in creating a new society. Whatever the practicalities of introducing a UBI – and even the most sympathetic struggle to convince that it can be fully implemented or afforded – its desirability is surely in doubt.

There is, or at least there should be, a formidable moral case against UBI – as a disempowering and ultimately self-defeating policy idea that treats people as passive participants in an elite experiment – one that can only undermine people’s sense of themselves as self-reliant and responsible members of the community. That self-respect that Joe Biden talks about is the foundation of the very idea of being a citizen and a productive member of society. But there are also political arguments that are not being had, about the state of the economy, about challenging low horizons and demanding more of our political class and of employers. UBI has become, in this way, a substitute for coming up with a coherent set of ideas to address today’s social and economic problems. What could in different times be a perfectly good idea has instead become a distraction from more pressing matters.

Based on a speech at Battle of Ideas 2017

Homelessness – Bricks and Mortar and More Besides

First published in Huffington Post

The complexity of the homelessness problem is undeniable and its causes are multiple: families evicted from their homes into B&Bs, people falling foul of the benefits system, or on the run from an abusive partner; youngsters leaving the care system, or people discharged from mental health wards or thrown out of their asylum accommodation on being granted refugee status. These are just some of the reasons people find themselves homeless. According to former shadow housing minister John Healey, nearly 80,000 families in England could be made homeless by 2020. In Scotland nearly 30,000 households were made homeless last year. In Northern Ireland 20,000 households are affected.

While building enough houses for people to live in really is something we should have mastered by now, the homeless problem has always been about more than just bricks and mortar. Difficulties in people’s lives that cause them to become homeless may have nothing to do with the wider housing problem as such, except in the sense that as a consequence of those difficulties they have nowhere to live. It is their non-housing related circumstances, in other words, that have brought them to a housing crisis.

Nevertheless, if they are to find somewhere to live we need to get beyond the current housing policy impasse. It is still dominated by a late Cold War era battle of the tenures. The left argue for social housing as the best way to accommodate the poor and needy; and the right call for the sale of those state-owned properties in favour of increasing home ownership. Nobody much likes the private rental sector – ironically enough given that it’s what most people live in. According to PwC, in 2000 60% of Londoners owned (or at least the bank owned) their own home. This is projected to fall to 40% by 2025 if current trends continue. But both policies and their associated visions – of a council house for life vs. the home-owning democracy – have failed. Instead we have impossibly lengthy waiting lists to a run-down and residualised stock; and impossibly high house prices (and spiralling rents) that increasingly few can afford.

And so we are left with posturing and tinkering at the edges. The Communities and Local Government Select Committee has produced a report concluding that the homeless are ‘badly treated’ by local authorities who – they argue – should have a legal duty imposed upon them to support and advise those looking for somewhere to live. Likewise, John Healey argues that there is a need to ‘strengthen the law to help prevent homelessness happening in the first place, as Labour has done in Wales’. Which may sound reasonable, but local authorities rightly respond that they don’t have the resources or the powers to do this anymore. You can’t legislate against homelessness by forcing councils to provide stock that they don’t have and can’t build. Inevitably what’s left is highly undesirable.

Homeless charities and others call for a ‘strong housing safety net’ and ‘preventative help’, which sounds fair enough. But it won’t solve the problem; it will only provide a temporary buffer for those at risk of losing their homes. Likewise the mantra that we need more affordable housing can hardly be objected to; but it is pretty meaningless in today’s hyper-inflated housing market. Building more houses and lots of them is our best chance of solving the affordability problem – and that should be done across the tenures. Otherwise all that is left for the state to do is interfere in people’s personal lives – something it won’t hesitate to do. There is a lot to recommend ‘sustaining’ people in their homes, helping them with their rent or brokering their relationship with their landlords. But why stop at people’s relationships with their landlords? One reason people become homeless is because of problems in their relationships with each other. The official figures show that sharing and marital breakdown is the single biggest cause of homelessness in Northern Ireland. Surely it’s not housing these people need, its relationship advice? So the logic goes.

No. Instead of tinkering and meddling we need bold policy. We should free developers from the unnecessary constraints imposed by planning law, and free-up planners to plan more and better housing. Local Authorities and Housing Associations should be encouraged to build instead of their stock being diminished by a state imposed ‘right to buy’; and the local state (with its PSPOs) should get off the backs of the homeless too. So let’s loosen the constraints and target resources where they are most badly needed. That way we might both get more houses built and start to address the difficulties faced by those in desperate need.

Homelessness – Accommodating to Lowered Expectations

First published in Huffington Post

Courtney Cox and David Beckham have recently drawn attention to those sleeping rough (or at least to their part in drawing our attention to them). And rightly too. There were 1,768 people sleeping rough in England in autumn 2010. This more than doubled to 3,569 in 2015. Over that same period, says the National Audit Office, the funding available to support the homeless has nearly halved. According to homeless charity St Mungo’s, around half of rough sleepers suffer from mental health problems.

So the former Friends star on a recent visit to Manchester signed the sleeping bag of a man called Scott. Scott turned out to be an autograph hunter – he also had Pete Doherty’s – happily upending the usual victim narrative. According to a celebrity gossip piece, when Beckham, on a family visit to a gourmet burger bar in Chelsea, ‘handed the burger to the homeless man … the guy’s face lit up’. Judging by the accompanying photo this is because he also gave him his bottle of beer. Whether cynically playing to the cameras or just a kindly gesture (I’d like to think the latter), good on the former footballer turned clothes horse for giving the man something that moralisers would no doubt disapprove of.

But as anybody working in the housing sector will tell you, there is more to homelessness than the people you see out sleeping on the streets. As Shelter have highlighted, families are increasingly temporarily housed many miles away from where they lived prior to losing their homes – disrupting family, community and working life, and their kids’ education too. In 2010 5,330 households were temporarily housed ‘out of area’, more than tripling to 17,150 in 2015. Nine out of ten of these families are from London, half housed ‘out of area’ and half of these outside London, say the charity. The government insists that ‘councils have a legal duty to ensure that any temporary accommodation they offer is safe and suitable for the family concerned’. But the charity is sympathetic to local authorities’ predicament, recognising that they are ‘overstretched’ by an ever diminished housing stock and rising levels of need.

Spelthorne Borough Council in Surrey is to be commended for its imaginative response to the crisis. It has reportedly bought a hotel at a cost of £2 million to accommodate up to twenty ‘households’. It might sound a lot but it’s not a bad investment. Especially when you consider that the Council spent nearly half a million on providing temporary accommodation just last year. But it is an increasingly big ask of any one part of the system to solve the problem, not least because there is more than one housing crisis. ‘Homelessness’ is a multi-faceted phenomenon best understood as both part of, and yet bigger than, the wider housing problem. That wider problem being that there are not enough houses to go around. Added into the mix of rising rents, caps to and reforms of benefits (from the freezing of housing benefit to tougher sanctions on unemployment benefit) in a context of already falling living standards brought about by longstanding economic stagnation and recent economic crises; are the multiple and various crises that people experience at a personal level. (As St Mungo’s argue, what many living on the streets need more than anything is specialist mental health support and housing options when they’re discharged from hospital.)

And on top of all that is a political culture that has accommodated to lowered expectations (rather than accommodating people), while bringing into being a therapy state that, paradoxically, fails to target resources where they are most needed. And fails to generate the policy solutions needed to tackle any of the housing crises with which it is faced. With increasing numbers of single people on the streets and families living in temporary accommodation, and many, many more struggling to afford their rent or mortgage, policymakers urgently need to do both of those things.