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Corbynomics won’t help the poor

6 December 2019

2:20 PM

6 December 2019

2:20 PM

Here’s a curiosity of the 2019 general election: given that both the big parties agree that austerity is over and Britain wants a more generous state, why is no one doing much to help the poor? And why is no one talking about that failure?

These questions start with Labour. Jeremy Corbyn’s fans see him as a radical crusader for economic justice, an almost ascetic figure utterly devoted to the disadvantaged. In the mad ‘story’ about Corbyn and the Queen’s speech this week, the Labour leader had a perfectly good tale to tell: he spends part of his Christmas Day in a shelter for the homeless.

According to the Social Metrics Commission (SMC), a cross-party group of experts (including my Social Market Foundation colleague Matt Oakley) there are 4.5 million people who are more than 50 per cent below the poverty line. According to the same research, 7 million people are living in persistent poverty (The SMC puts the poverty line at 54 per cent of the resources available to the typical or median household, if you’re interested).

That’s a lot of people experiencing the sort of hardship and economic strife that Corbyn is, it is said, committed to ending. Yet how much of that personal commitment is felt in Labour’s policies? Surprisingly little.

By Labour’s own figures, the party would spend an extra £83 billion in its first year in office. But not much of that goes directly on the poor. Instead, the party seems more intent on things that would hand money to people who need it less.

For instance, abolishing tuition fees (and restoring grants) has a gross cost of £13.6 billion. University students tend to be from better off homes. Less than 30 per cent of kids from the poorest fifth of households go into higher education – in the top bracket, it’s 60 per cent.

Abolishing fees amounts to a middle-class subsidy. Especially because middle-class students are most likely to go on to high-earning jobs that require full repayment of loans.

By contrast, the Labour manifesto allocates just £8.4 billion to welfare and even that is not solely directed at the poorest. Some of it goes on things like higher paternity pay, carers’ allowance and the bereaved. Those are perfectly worthy causes, but like much else in the Labour programme, they are not targeted at the poorest.

Yes, the party would scrap the two-child limit that most independent analysts (and a few thoughtful Tories) say will add significantly to child poverty in the years ahead. But there is no pledge to reverse the real-terms cuts in welfare that began in the coalition years. Nor is there money to raise the work allowance in Universal Credit, which would mean working claimants would gain more from their labour.

Contrast that with the promise to hand £12 billion a year to the Waspi women who were surprised by a change to their state pensions first announced in parliament in 1995. Some of them will be in the lowest income bracket, but many will not. Yet Labour regards their needs as more deserving of the application of £60 billion quid than, for instance, the 4.6 million children in poverty.

As I’ve written here before, a similar critique might be made of Labour’s commitments under its nationalisation agenda. Cheaper travel on nationalised trains is likely to be of most help to people on higher earnings and those in the South East, since they are much more likely to travel by train. See also: free broadband for the millions of households who can comfortably afford to pay for it today.

In short, there is a clear criticism that could be made of the Labour manifesto that it commits to spend a barrel load of money on people other than the poorest. Which is quite hard to square with the idea of Corbyn as devoted to the most disadvantaged.

Quite why Corbynomics doesn’t prioritise the poor is a question that is beyond me. Perhaps it’s an ideological commitment to universalism in public provision rather than means-testing and targeting resources. If so, that appears to depart from Nye Bevan’s view that ‘the language of priorities is the religion of socialism.’

Or perhaps the reason Corbyn wants to offer bundles of cash to middle-class voters instead of the poorest is that he wants their votes and he’s really just another politician, calculating and triangulating while claiming to be driven by principle. Who knows?

In a sense, this is all academic, because no one is really making that criticism of Corbyn’s relative neglect of the poorest. Even though there are surely good, sharp questions to ask of today’s Labour platform and its failure to match the Corbynite rhetoric.

But who’s going to make that criticism? Not today’s Conservative party. The Tories may be on an electorally-sensible journey towards a slightly more generous state, but that path hasn’t taken them – publicly at least – anywhere near welfare and poverty.

Again, there’s an electoral dimension to that. Because, bluntly, past Conservative policy contributed to the poverty outlined in the SMC stats (the welfare freeze and the two-child rule, among others). Because the party has a legacy problem with being seen as cruel and heartless, the campaign calculation is to avoid talking about poverty and welfare. Hence the unedifying omission of welfare from the Tory manifesto.

Much as the Corbyn stance on poverty and welfare is politically explicable but cynical, the Tory calculation is understandable but not admirable. And much as I think that a big-spending Labour party should focus its big spending on the poorest, I think a Conservative party that says it values hard work and enterprise should be doing a lot more for low-income households.

The Tory starting point should be in-work poverty. A party that says it values hard work and effort should be appalled that it is not just possible but common to be both in work and poor in the UK today.

According to the SMC, the poverty rate among families where adults work part-time is 58 per cent, and 10 per cent for those with full-time work. Yet where is the Conservative anger, shame or determination to change that? There are, to be clear, Conservatives who do care about this stuff. Whatever his failures on implementation, the foundation of Iain Duncan Smith’s Universal Credit was a determination to lift people out of poverty – and the conviction that doing so was a central Tory mission. Then there’s Michael Gove, who said in 2015 that his party needed to be ‘warriors for the dispossessed’.

Both men have since been consumed by Brexit so we hear less from them about poverty. But there are, quietly, Tories at work today who hope that might change if the party wins next week. Or perhaps if, as many Labour people seem to expect, the party is soon facing life after Corbyn, it may seek to do more to put poverty on the agenda.

But both of those possibilities lie on the other side of 12 December. Elections should be the time when we discuss the big problems we face as a country. Whatever you think of the issue, the people and the policies, we should be talking about poverty and those who experience it. But thanks to this miserable election and its dismal tactics, poverty – like so much else that actually matters – will just have to wait.


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