Yesterday evening I watched an event hosted by CentreForum, the Centre for Social Justice, the Fabians and the Child Poverty Action group, on the broad subject of What to do about Poverty after the Crunch.
The speakers were all very knowledgeable and poised. All of their views, in isolation, made sense.
Kate Green of CPAG points out that people can be in work and in poverty, so don’t rely on work. And excluding the middle class from benefits through means-testing means that those powerful people won’t fight for the disadvantaged. She was ‘dismayed’ by hearing about the Lib Dems stopping child benefit from being universal.
Steve Webb MP spoke movingly about the difficulties of the tax credit system, and explained the ineradicable trade-off between high benefits at the low-end and low marginal taxes. They have to be withdrawn eventually, you see . . .
Questions from the audience all, again, illustrated a high degree of knowledge about specific problems that would occur if any money was withdrawn. The CSJ suggestion of simplifying benefits from 52 types to 2 was warned against by Steve, who pointed out how many the losers would be.
All of this was quite fine and moving, in its way. It also went nowhere near facing the ‘hard choices’ that were needed to make ANY of it happen. If you were to extract ‘pledges’ from the panel, they would have been:
– increase out of work benefits, to help prevent poverty
– but also increase in-work benefits, to retain a reason to work
– and don’t reduce them for the rich, either, in case you get a two-tier classed society.
How much does that lot add up to? £10bn? In the meantime, in the 12 months since this agenda was last pushed in a broadly identical shape, the fiscal situation in 2012 has gone from 550bn debt to 900bn debt, and a 20bn deficit to a 120bn deficit. But, for all that you would guess from this event, this made no difference. “My agenda matters – there are real people involved – don’t backtrack”. No hard choices made, at all. They are all for someone else to pay for.
Unfortunately, the incomes of the very rich are about £250bn, with £80bn already paid in taxes. You might struggle to get another £5bn from them.
Just another £100bn to go …
This is why the news that Nick Clegg has admitted the inevitable on tuition fees is doubly welcome. As our pamphlet shows, this is a bad policy, full stop, regardless of the fiscal situation. In the current budgetary condition, it truly sucks.