Red Tories Blowin in the Wind: A Chronicle of Welfare Cuts Foretold

 

Sometimes calling them Red Tories is being too kind. Labour’s £6 billion pounds’ worth of cuts to disability benefit, which threatens the “ability of low-income families to meet basic needs like food and shelter, potentially endangering lives”, is going somewhere even the Tories under Iain Duncan Smith’s regime of conscious cruelty did not tread.

The cut means that from next year new claimants in the Limited Capacity for Work-Related Activity group (LCWRA) will only get £47 a week to ‘live’ on, £50 less than they currently do. Existing claimants will have their benefit frozen at £97 a week, a real-terms cut. And if you’re under 22 you won’t be able to get anything at all.

Additionally, it will become harder to claim Personal Independence Payments. Under Kendall’s plans you have to ‘score’ more points on daily activities, such as incontinence, washing and dressing, and communicating.

For context, LCWRA is the old Support Group under pre-Universal Credit Employment & Support Allowance (ESA). These are people officially deemed to have such severe health problems there is no current prospect of them being able to work, notwithstanding Labour’s insistence that those with the harshest, ‘life-long’, conditions will be exempt.

Even Iain Duncan Smith left them alone. His attention was taken up with applying the Work Capability Assessment – introduced by Labour in 2008 – to existing ESA claimants, to turning the screw on those declared unfit for work but placed in the Work-Related Activity Group  (the equivalent of the Limited Capacity for Work group under Universal Credit), and ratcheting up sanctions on Jobseekers’ Allowance claimants (over a million sanctions were imposed in 2013).

Not that he wouldn’t have got around to it had he not abruptly resigned as Work and Pensions secretary in 2016. Although it’s illuminating to recall why he resigned from Cameron’s Cabinet. It was, he claimed, because he couldn’t stomach cuts to Personal Independence Payments*, which would have made it harder to qualify for PIP and meant some people wouldn’t have got anything at all. Last year, nearly half of all claims for PIP, around 300,000, were rejected.

The Starmer/Kendall/Reeves cuts are on top of the cuts that Duncan Smith found so intolerable he had to resign. This means that the current Labour government are significantly to the right of Iain Duncan Smith. When Rachel Reeves promised to be tougher than the Tories on benefits (not as tough as, mind, but tougher), she was telling the truth for once.

But with all due respect to the innate genius of IDS, Kier Starmer, Liz Kendall, Rachel Reeves, Therese Coffey or Yvette Cooper (that’s irony by the way), you can see what is going to happen to disability benefits simply by observing what important think tanks and corporate ‘thought leaders’ are saying.

The fact the Labour are introducing these cuts is, in a sense, irrelevant. Labour are, at present, the British government (probably for one term admittedly) and this is simply what the British government wants to do.

So let’s look at a chronicle of disability benefit cuts foretold.

In November 2014, Paul Litchfield, chief medical officer of the BT Group, published the fifth and final independent review of the Work Capability Assessment. This was, as John Pring notes in The Department, the very time that claimant deaths were reaching a peak under the first round of austerity, but Litchfield wasn’t interested in that. He recommended that the government look “as a matter of urgency” into why there had been such a substantial rise in the proportion of claimants placed in the Support group.

In a curious twist of fate, that is exactly what Starmer’s Labour government is doing.

In 2016, the neoliberal Reform think-tank proposed slashing the weekly benefit given to people in the Support Group by £58 so as to equalize it with the rate of Jobseeker’s Allowance. The thinking was that having a higher rate for sick and disabled people encouraged them “to stay on sickness benefits rather than move into work”. The chimes perfectly with Labour’s claims that the benefit system represents a “big discouragement to work”.

Reform (the think-tank not Farage’s company masquerading a political party that is currently leading in the polls) also described the benefits system as “broken” which uncannily is the exact word chosen by Sir Kier Starmer.

Interestingly, though, while Reform advocated putting the money saved from removing the additions to standard unemployment allowance into an enhanced Personal Independence Payment, Labour is cutting PIP as well. And the benefit levels for disabled people and the main body of claimants aren’t being equalised, the former is being significantly reduced.

Also in 2016, the Social Market Foundation proposed abolishing the ESA Support Group entirely.

The writer, who in 2016 analysed the output of these think-tanks, made a prophetic statement: “Policy change can often be explained by reference to changes in background ideas about the state, society and the individual, held and promoted by influential individuals, groups, political parties and … multinational companies,” she said. “It turns out that you can predict such a lot by simply watching the way the wind blows.”

Dominic Cummings, who apparently is informally advising Starmer’s government, used to refer to the educational ‘establishment’ – made up of local authorities, teaching unions and even the Department of Education – as the ‘blob’ because they were, allegedly, always thwarting his plans for schools.

In reality, the blob, consisting of “influential individuals, groups, political parties and … multinational companies” is always at work ensuring governments, as in the case of disability benefits, keep to the neoliberal script.

It is so huge it is very difficult to exist outside of it. The blob has a very keen sense of its own self-interest, and can always provide useful advice on what to say on any given subject, meaning its members don’t have to expend too much energy on thinking.

Corbyn wasn’t part of the blob and look what happened to him. But the blob has devoted acolytes at the helm of all political parties (and also in the backwaters of all political parties). Reform, the ‘party’ that is, might present itself as anti-establishment but it is right at the heart of the blob; its former leader, Richard Tice, handily on message in attacking “shirkers and skivers”.  The Greens might appear to be the one political party that is resisting the blob but should they ever hold the balance of power and enter government, I predict the blog will emerge victorious after a short scuffle.

To adapt the old anarchist canard, and song, no matter who you vote for, the blob always gets in.

* Duncan Smith was a tyrannical advocate of the notion that work is good for you, a zealotry shared with fellow blob dwellers Starmer, Reeves and Kendall. So it’s revealing that he was so opposed to cutting Personal Independence Payments. Perhaps that’s because, in recompensing people for the additional costs of disability, PIP enables people to work. But this realisation is apparently lost on the geniuses in the DWP.

And You're Working for No-one but Us

 “And you’re working for no-one but me” is George Harrison’s sign off to the first song on one of the greatest British albums of all time, the Beatles’ Revolver. But compared to what follows it has always struck me as rather a damp squib – lyrically one extended whinge about how Surrey mansion dwellers pay too much in tax. I suppose to be fair to the author, Harrison was very anti-war and he objected to unwillingly paying millions in tax – at the time the top rate stood at 92.6% – so governments could bomb people.

Nonetheless it is quite sad that of all the sentiments the Beatles expressed, “in the end” it was those of Taxman that had the greatest longevity. You need a lot than love, and giving war a chance now seems to be the spirit of the age (alright that was Lennon). But thanks to Margaret Thatcher, Ronald Reagan, and the sprouting up of numerous tax havens around the world successful pop stars need no longer fret about governments getting their paws on their money.

But from the perspective of nearly sixty years, to sing “you’re working for no-one but me” with reference to His Majesty’s tax collectors seems faintly ridiculous. We’re definitely working for someone but there are people much further up the queue than HMRC. Perhaps their silhouettes need more light shone on them:

Landlords and Banks

The first thing we all need is somewhere to live. After rising above inflation for years, rents increased by 9% in 2024, the highest surge on record. The average rent now consumes over a third of renters’ income and more than half of it in London.

Though there are only 11 and half million renters in the UK, their numbers are inexorably rising. But they are still below the so-called “owner occupiers”. Except in many cases, while they occupy, they don’t own anything. The ‘owners’ are paying off a debt (which everyone calls a mortgage to avoid calling it a debt) to the actual owner of their property, usually a bank. And since interest rates have ballooned in the last few years – in the context of house prices inflating by 1,000% since the early 1980s – that debt has become much more expensive.

Banks, by the way, are sharing the pain by making record profits – HSBC amassed £24 billion in 2023, an 80% increase. This windfall results from the interest they receive on mortgage payments and loans being so much higher than the interest they pay on their savings accounts. Why this discrepancy should exist is a bit of a mystery. Theoretically, the two should cancel each other out and banks should not be laughing all the way to the bank because interest rates have been hiked. Maybe Sir Kier – who gave HSBC’s chief executive a knighthood in December – can enlighten us.

It’s good to know the people your monthly labours are paying off are having a hard time too.

Utility companies

Next on the identity parade are water and energy companies. In the past, these two public services were nationalized. But in our post-Thatcherite wasteland, sorry landscape, they are the play things of private equity firms who load the owners with debt and expect their captive customers – us in other words – to pay for the privilege of being compelled to use them. I just love the free market.

And when, as with Bulb Energy, these wealth destroyers experience liquidity problems, they can rely on the taxpayer, in the form of the government, to bail them out. Not that we have any say in the matter.

When the direct debits kick in every month, a lot of the damage to your balance is down to these two suspects. Energy bills are about 50% higher than they were pre-Covid. As with rent and mortgage payments, only in a semantic sense is this not taxation. Unless you want to live in a cave somewhere, or on the streets, you need a home and you need heating and water. Contrary to American monetarist proselytiser, Milton Friedman, we are not “free to choose”.

And it’s going to get worse. The average water bill will increase by 36% over the few years.

“If you get too cold, I’ll tax the heat,” Harrison sang in 1966. He meant, “I’ll raise the energy price cap”.

Corporations and things like eating

In common with all living beings, human beings need to consume if they want to continue living. But the cost of consumption keeps going up. If consumer inflation has fallen from its highs of a couple of years ago, that doesn’t mean prices will return to their former levels, just that they will continue to rise at a slower rate (although inflation seems going up again now anyway).

But the ever-increasing cost of essential goods is not solely due to ‘impersonal’ factors like the cost of raw materials. It is also down to the power of the huge corporations that dominate the market to increase costs above the ‘natural’ rate of inflation. For example, in the UK, “price mark ups” – price increases above the production costs to produce profit – rose from 58% in 2002 to 82% in 2020. The profits of the 350 largest companies on the London Stock Exchange have swollen by 73% since 2019.

This price gouging is symbolised by internet providers typically hiking raising annual broadband fees – now essential for doing most things in life, including work – by CPI (inflation) plus 3.9%. Why? Because they can.

What is now hitting home is that, contrary to the advertising, the Thatcherite revolution did not enthrone the consumer as king. Everyone knew that workers would have to suck it up, but the customer was felicitated. But that’s not how things have turned out. All regulators have a duty to protect the consumer but, as evidenced by the failure to compel banks to pay interest on savings in line with hikes in interest rates, this is just honoured in the breach. And with Reeves’s drive for deregulation, such a responsibility is going to become even more threadbare.

 You have to crane your neck to see the real beneficiaries.

Only in the perverse universe we now inhabit, could a privately educated ex-stockbroker who claims to be “keeping the flame of Thatcherism alive” and controls a company masquerading as a political party be the one to take advantage of this situation.

It’s enough to make you gently weep.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The British establishment's herd mentality and obliviousness to suffering

 Review of The Department: How a Violent Government Bureacracy Killed Hundreds and Hid the Evidence, by John Pring, part two

 There is always a TV documentary. Just as the Department for Work and Pensions readies itself to make disability benefits harder to get – for example by disallowing mobility problems  or the inability to cope in social situations from counting towards a successful claim – a documentary magically appears on state television (Channel 4 in this case) explaining why the changes must be made, and in fact probably don’t go far enough.

The country faces bankruptcy because of the mounting benefit bill, we are told on Spectator journalist Fraser Nelson’s film Britain’s Benefits Scandal; millions of people are being ‘written off’. I think I’ve heard this story somewhere before …. Ah yes, it was under the post-2010 Cameron coalition when the assault on the ‘unsustainable’ benefits bill resulted – as Pring documents in his book – in hundreds of deaths.

Curiously, the person invoking the horror of the government running out of money is a spokesman for the Centre for Social Justice, the think-tank set up by Iain Duncan Smith who, as Secretary of State for Work and Pensions, oversaw the previous round of culling. And so the baton passes to a new generation.

The shallow propaganda is on show almost from the first frame. There was outrage in the 1980s, Nelson recalls with a darkened face, when unemployment hit 3 million or more, so where’s the outage now when similar numbers are on “long-term disability benefit” (whatever that is)? But the outrage in the ’80s was about so many people being unemployed, not that they were on unemployment benefit. The only outrage about that emanated from Thatcher’s Cabinet and the Adam Smith Institute.  The equivalent outrage today would lead to asking why so many millions are physically and mentally sick.  But posing that question seems to be exclusive province of niche publications like Pring’s Disability News Service.

Oddly, among its vanishingly small valid points, Nelson’s documentary inadvertently makes the case for Unconditional Basic Income. Benefits are too generous, we are told, and thus people have no incentive to take jobs. This is because if you do go into work, all your benefits are instantly removed. But unconditional basic income – as opposed to the hugely conditional (and meagre) income support we now have – would not be removed whether a person had three jobs or spent every waking hour reading analytic philosophy. Thus it would ‘make work pay’ in a humanitarian way. This point was made by John McDonnell’s former economic advisor, Guy Standing (so obviously it’s extremely suspect and probably anti-Semitic).

But to return to the reality we unfortunately inhabit, it is a sight to behold the way British political mono-thinking instantly clicks into gear without any orders having to be given. Thus the cross-party Economic Affairs committee of the House of Lords (a body whose members are funded by taxpayers to fall asleep) solemnly intoned in January that the Work Capability Assessment “isn’t rigorous enough”, and that their lower conditionality means people have an incentive to apply for disability benefits. Meanwhile, Number 10 and Number 11 are apparently “pulling their hair out” over how long it is taking the very right-wing Labour secretary of state for Work and Pensions, Liz Kendall, to make welfare cuts. Faster! Faster!

As if to throw some meat to the baying hounds, Kendall has announced a resurrection of Rishi Sunak’s plans to rifle through the bank accounts of sick and disabled people suspected of (virtually non-existent) fraud, without even having to apply to the courts for permission. As an added touch of vindictiveness, driving licences may now be taken away. It is now clear – if it wasn’t before – that to the political class, of whatever shade of rosette, there are certain classes of very vulnerable people to whom it is possible to do anything, no matter how callous and draconian.

At this point you may be forgiven for wanting to hide under a rock (although we need to eradicate the incentive for misusing rocks in this way), but one of the many virtues of Pring’s book is that it reveals how we’ve been down this road before. With all due respect etc., the path to hell can also be paved with very bad intentions. But it helps to know that the unheavenly choir we are forced to listen to has a very limited, though up to now astonishingly effective, repertoire.

On three separate hinge points – when all this began in the dog days of Thatcher, when the Blair government wanted irrefutable evidence it was no longer ‘old’ Labour, and when the coalition was itching to pin the budget deficit on “shirkers” cheating the system – the media was on call to spread the message.

And by the media, I don’t just mean the usual suspects at the Sun or the Express or Mail. I also mean the more ‘liberal’ media like the BBC or the Guardian, or other broadcasters. For example the 1996 documentary The System on BBC2 hinted at widespread fraud and described Invalidity Benefit (the then the out-of-work disability benefit) as “known to cynics as the bad back benefit”.

In 2007, when Labour was introducing the Work Capability Assessment, The Guardian newspaper, now on board because it was Labour who were doing it, gave the floor to Matthew Elliot of the right-wing Taxpayers Alliance to bemoan the fact that many claimants were “taking advantage of the good nature of their GP”.

And of course we now have the obligatory documentary, urging the government to do what it already wants to do, on state-owned broadcaster, Channel 4.

What these others, the non-right-wing media, do is to ‘close the loop’. If even the Labour party is saying fraud is a massive problem in the benefit system, then it must be. Actually, it’s virtually non-existent. If even a cross-party House of Lords committee says the Work Capability Assessment isn’t strict enough, then it must be letting the lazy enjoy a life on benefits. Actually, as Pring shows, there have been hundreds of deaths (at least) because the Work Capability Assessment is so callous.

This process will end in a human disaster, and it already is for people who have no choice but to eke out an existence on disability ‘benefits’. We are now entering the surreal territory of the Labour party claiming, in the pages of The Sun, that the Tories weren’t tough enough towards claimants and allowed the ‘benefits bill’ to spiral out of control. Poor Iain Duncan Smith, he tried his best but it wasn’t good enough! But, says Rachel Reeves, Labour will act.

The system does not preclude any dissent. Channel 4, to be fair, did broadcast a film three years ago on The Truth About Disability Benefits (now interestingly only available on YouTube). But like bison deciding where they want to move to, the direction of travel is indicated and everyone in the establishment herd instantly knows what to say without having to be told. And as demonstrated by what happened to the outsider Jeremy Corbyn between 2015 and 2019, if anyone not in the group finds themselves, by some freakish accident, in a position of power or influence, the hostility is unrelenting.

If this is freedom, as we’re told it is, then freedom desperately needs some pluralism.

 

Here is part one