Ending poverty should be seen as an integral part of economic policy, not the enemy of or disconnected from it.
The coalition’s policies are set to cause terrible hardship. Already, there’s a shameful rise in the numbers of people having to access food banks, and cuts to benefits, including housing benefit and benefits for children, will put families under tremendous pressure. A combination of massive job losses in the public sector and a lack of business confidence, which is deterring investment in our economy, mean that many struggle to get a job, or when they do, find themselves in stop-go, poorly paid employment. Yet the narrative is all of ‘benefits scroungers’ and ‘welfare dependency’; there is little recognition of the structural drivers of poverty and inequality.
To be sure, there is much to be done to flesh out a policy programme that invests in the drivers of prosperity and growth, and creates an equal and lasting recovery. Labour has already begun to redirect the debate on poverty and inequality, framing it around the Beveridge principle of full employment. Ed Balls’s proposals to tax bankers’ bonuses and use windfall profits from the sale of 4G are focused on driving the economic recovery and, crucially, creating jobs. Liam Byrne’s interest in a reformed social security system recognises the need to move beyond a de minimis safety net, acknowledging the need to recognise contribution as a prerequisite for more generous benefit levels when people fall out of employment.
The Labour governments between 1997 and 2010 made tremendous progress in reducing poverty. Pensioner poverty halved, and more than a million children were taken out of poverty. Yet, despite this achievement, the present government accuses Labour of having failed on poverty, at the same time as its own austerity measures undo all the good that was done. That it’s been possible simultaneously to trash Labour’s record, put progress into reverse, and question the very concept of poverty, as Iain Duncan Smith and his cronies repeatedly do, is testament to perhaps Labour’s greatest mistake – we didn’t do enough to cement and trumpet our own achievements.
The policy solutions lie not just with social security, but also in our industrial policy, education and skills, and infrastructure investment. Ed Miliband’s ‘one nation’ must be one that is free of poverty. Full employment is fundamental to achieving that.