Monday 20 January 2014

Labour, Social Security and Triangulation

Dan Hodges wrote earlier that Labour should shut up about benefits. I couldn't agree more, though I expect it is for very different reasons. Dan is of the old amoral Blairite school that thinks cutting deeply into the social security budget will pave the road to electoral victory with gold. If Labour are going to talk welfare, then it can never be in terms other than sticking it to the indolent. Never mind the pain and anxiety it would cause. Never mind heaping up misery for the working poor, the unemployed and the disabled. Never mind the myths they stoke. Presumably them voters who want to see the boot put into largely imaginary dole wallahs would reward "tough-talking" Labour and come streaming over. Yet this utterly cynical view has one major flaw. It ignores the fact that Labour faces a Conservative Party only happy to dig deeper to undermine what remains of the welfare state, and will grub around in the dirt for any votes to be had.

Prompting Dan's "advice" was today's big announcement from Rachel Reeves that Labour has found a new excuse to sanction JSA recipients. Under the proposed rules, applicants will be expected to undertake basic literacy and numeracy tests. Those who fail will then be expected to take courses in Maths and English. And if they refuse, it's party time for that layer of DWP workers who get off on humiliating the undeserving poor.

Compared to the Tories wanting to strip out support for workers under the age of 25, regardless of need, Rachel's policy announcement is small beer. Indeed, I'm forced to agree with Dan again that this is minor detail, not headline news. The frustrating thing is it's not as though Labour hasn't got a distinctive social security policy already. Pushing the living wage - and perhaps advocating it as the minimum if Osborne persists calling for £7/hour - capping rents, abolishing the bedroom tax. This is good stuff, enough to warm the stony hearts of Labour cynics and hacks alike. Wearing a Hodges hat, the only problem with them is no one gets a kicking. But that's okay. If you like your compassion with a hard edge, there is Labour's job guarantee - an "offer" to take up a state-provided (minimum wage) job under pain of sanctions after a period on the dole. The principle is sound, in my opinion - the likely implementation less so. Nevertheless this policy is more positive than anything the Tories can offer and has the potential to change dominant perceptions of unemployment. I can guarantee it, if Labour win and introduce the policy there will be a lot of unemployed folk wanting to know why they cannot access those jobs right away instead of languishing on the dole for up to two years. So come on, instead of being "firm" Labour should be pushing its distinctive rights/responsibilities social security agenda and put some flesh on them bones. Technicalities around sanctions regimes is so much time wasting.

Another thing needs remembering as well. As a proper cynic, Dan might want to reflect on how many votes Labour would lose if it follows his advice. The next election is in 2015. What worked in 1997 won't work again. The Labour activists, the edge the party has over the Tories and LibDems will not be motivated to campaign if policy is little more than Tory-lite. The so-called working class vote - the people Dan wants Labour to hurt are counted among its ranks - can always vote for a viable anti-politics alternative or stay at home. And those elements of the middle class that are as Labour as any old miners' estate, they too might find more pressing things to do than casting a ballot for a party that wants to hammer welfare. Core voters of the historic alliance at the heart of Labourism live in swing seats too. If they stay at home in protest or because the party does not inspire them enough, well, we know what the outcome will be. So yes, Labour needs to shut up about welfare and start talking positively about social security. And it would also do well to close its ears to the siren voices of 17 years ago.


jimboo said...

Considering it could be the unemployed, sick and disabled that will win the marginals for Labour. aaaaaaaaargh.

Jobseeker said...

To understand why Labour`s Job Guarantee only applies to the long term unemployed one need only look at the minutes of the Bank of England`s Monetary Policy Committee from December 1997:

Paragraph: A41 The relationship between unemployment and earnings was then considered: in particular, did short-term unemployment exert more downward pressure on earnings than long-term unemployment?

A43 Whatever the reason, the implications for the effect of long-term unemployment on wage pressure were the same: when the proportion of long-term jobless was high, for a given level of total unemployment, workers would probably realise that they could not be replaced so easily, and hence that their bargaining strength was higher.

A44 The empirical evidence in general supported a more powerful role for short-term unemployment in putting downward pressure on wages. Some studies suggested that only short-term unemployment mattered. But recent Bank research had suggested that, although short-term unemployment was more important, the potential downward effect of long-term unemployment on wages should not be disregarded.


Labour`s policy is all about "fine-tuning" the "reserve army of labour". The so-called “reforms” of the labour market in recent years have been designed to ensure that the unemployed are seen by workers as more of a threat to their jobs. State subsidies to employers encourage them to take on the unemployed and sack existing workers. The ultimate subsidy comes in the form of workfare – where new workers are paid nothing by their employers, and merely receive their state benefits in return for a full day`s work.