Food for Thought

I am listening to UB40’s debut single as I write. The band apparently don’t particularly like their first album Signing Off but it’s always been a favourite of mine. It is not, however, the music that forms the starting point for this piece but the name of the band.  Younger readers may not be aware that, back in 1980, when you signed on for the dole you received an entitlement card which was known as a UB40. Things were a little different in those days. There was no Job Seekers Allowance. Instead there was Supplementary Benefit for those claimants who had not paid National Insurance contributions and Unemployment Benefit for those who had. This was payable for twelve months and had an earnings related element, at least until 1982. As a result benefits were a little more generous than they are now.

You signed in weekly, not in a cosy Job Centre Plus building as you do these days but in some cold and damp DHSS office. There were no job search forms to fill in either. You signed to say that you had been available for work and were handed a giro cheque which you cashed at the Post Office. How do I know this? In those days students could sign on in the summer vacation. Here too times have changed and not for the better.

We should not get too nostalgic. Unemployed people were made to feel like worthless scroungers and the whole system was designed almost to degrade and humiliate people. But at least they were open about it and paid a level of benefit that you could, at a pinch, live on. Today you sign on in a nice warm office, you are referred to as a customer, but, underneath, the contempt remains. The benefits are now wholly inadequate, particularly if you don’t have children. The Government think a married couple can survive on £111.45 a week.

The other change for the worse is that they can make you perform forced labour. Workfare they call it. This frequently involves working for commercial enterprises or large charities that can afford to pay the proper rate for the job.

Last year two jobseekers won a case in the High Court which ruled that their benefits had been stopped unlawfully after they refused to work for nothing. One of them, Cait Reilly, was the target of vilification and abuse from politicians who should have known better. She was ordered to stack shelves at Poundland. Poundland is a large profitable commercial enterprise that is well able to pay the rate for the job. Why, in any event, do we have a national minimum wage? Cait was not sitting on her sofa drinking cider, she was doing voluntary work at a museum acquiring knowledge and skills for the career she intended to pursue. Working for Poundland would not have done this and the museum would have had significant problems without her contribution. According to Iain Duncan Smith she was a ‘snob’ who, apparently, thought she was ‘too good’ to work at Poundland. Far from it. Cait now has a part time job at Morrison’s. The point is she gets paid for working there.

The government has now passed a retrospective law to make legal what was declared illegal by the court and got out of paying £130 million in benefits withheld from claimants. This is arguably a breach of the Human Rights Act (indeed in many jurisdictions retrospective legislation is unconstitutional) and shows clearly the contempt in which the Government holds benefit claimants. That Labour abstained and failed to oppose the legislation is to their lasting shame.

It gets worse as , this week, the Guardian published a leaked e-mail from a Job Centre manager to her staff threatening g them with disciplinary action if they didn’t refer more people for sanction. The Government has denied that targets for benefit withdrawal are being set but here was the clear proof. Sanction is a sanitised way of reducing people who are already struggling to destitution. That there are people in Britain in 2013 who literally do not know where their next meal is coming from shames us all.

In defending the legislation to avoid paying out benefits withheld the Government talked about protecting the economy. In fact these payouts would have been good for the economy as all of the money would have been spent, providing an injection of much needed demand. Wage freezes and benefit cuts for those at the bottom and tax cuts for higher earners redistribute income from bottom to top and this, leaving aside the moral question, is inefficient economically. To boost demand and get the economy moving I propose the following: an increase in the top rate of tax to 60%, an increase in the 20% band to £40,000 per annum  reducing the tax burden on average earners, and a doubling of benefits. Quantitative Easing should be replaced by a hand out of £10,000 to every man woman and child in household earning less than £50,.000 per annum, to be spent within 28 days or used to pay down debt.  In this way we can get the economy moving, and have a fairer society. The point is that fairness and greater equality are not the enemy of economic growth but essential to it.

To the outgoing Governor of the Bank of England I say, along with UB40, ‘King where are your people now?’

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