Labour will never credibly out-do the Tories on a “tough” approach on welfare

January 4, 2013 11:44 am

Long-term unemployment has exploded in the last 2 years: a gut-wrenching 146% increase. That’s not down to an inexplicable 146% increase in laziness and fecklessness in a short space of time, as right-wing politicians and journalists would have us believe. It is a direct result of the catastrophic austerity programme of this Government which has sucked growth and demand out of the economy.

The Labour leadership is therefore absolutely right to take on one of the great social crises of Cameron’s Britain. Today, they unveiled plans to do just that. On Twitter this morning, I got a bit of a kicking for criticising them. Taxing the rich to create government-backed jobs for those thrown on the scrapheap by Cameron and Osborne – what possible problem could I have with that?

The big problem is – and my apologise for the politico jargon – “framing”. The Guardian headline reads “Balls: work for six months or no dole”; now, it would be wrong of me to condemn the Labour leadership for a headline written by a sub-editor, but it’s based on the spin fed to the newspaper. It’s quoted as a “compulsory work or lose benefits” policy; as Labour moving “to protect itself from the politically damaging charge that it is soft on welfare claimants”.

This may sound pernickety – it’s the details, not the language that matter, right? But this would be disastrously naive. The whole debate over welfare has become toxic because of a systematic campaign by Tory politicians and their allies in the media to demonise those in receipt of benefits: unemployed people, disabled people, and so on.

Research published by the TUC today shows that widespread hostility to welfare – which lacks precedent in previous economic crises – is down to pervasive myths about the level of benefits and who gets them. Unless this is challenged, the widespread demonisation of unemployed people and others will continue to be rampant – and the Tories will benefit from that. After all, if you really want to kick a scrounger, who do you vote for?

Unless Labour forcefully launch a counter-offensive on welfare, focusing on human stories – after all, they resonate with better than statistics – they will always lose the argument. They will never credibly out-do the Tories on a “tough” approach on welfare and – if they did – they might as well call it a day and pack up.

Labour have been moving in the right direction – notably taking on the 1% welfare cap which will hit both the working poor and the unemployed – but it is only effective if they stick relentlessly to the same message.

That’s not to say there aren’t problems with the detail of the policy. There has been a 146% increase in long-term unemployment in such a short space of time because there is a lack of secure work. What is being proposed are short-term placements – not proper jobs – lasting 6 months on poverty wages. It is effectively a subsidy for minimum wage jobs in the private sector. It is also completely out of sync with Labour’s new welcome message about the living wage. Why make a song and dance about the living wage and then announce that those condemned to long-term unemployment by economic crisis will be expected to take jobs way below it?

Only by reversing the destruction of secure jobs will long-term unemployment decrease in anything like a sustained way. Cameron gleefully points to the decline in overall unemployment, but this has been driven by a dramatic increase in the number of part-time workers who want full-time work and bogus self-employment (like my dad in the mid-1990s who lost his job, registered as self-employment but had barely any paid work in practice). Self-unemployment if you like. According to the Joseph Rowntree Foundation, there are now 6.5 million people looking for full-time work who cannot get it.

To underline just how profound the jobs crisis is, the JRF recently pointed out that up to 66 young people were applying for every job in retail. One in 12 university graduates are without work after six months, and a third are are in non-graduate jobs - a jump from a quarter a decade ago.

To take on the jobs crisis, Labour first of all needs to unveil a detailed industrial strategy, particularly to replace the middle-income skilled jobs that have been trashed since the 1980s. It has talked an industrial strategy – after all, even the CBI do - but it has not been fleshed out. Above all, it means looking to examples like Germany, which avoided the “let the market decide, Government doesn’t pick winners or losers” approach of New Labour and the Tories. As a consequence, Germany avoided the wholesale trashing of manufacturing we experienced in this country. Hundreds of thousands of jobs have been created in the renewable energy sector – “green-collar jobs” – that take on both the environmental and jobs crises. That unashamed state interventionism is what we need here, too.

Secondly, we need to deal with the housing crisis . At the moment, we waste £21 billions on landlord subsidy – or “housing benefit”, as it is officially called – lining the pockets of those charging extortionate rents. Instead, we should have a far-reaching council housing programme that would bring down the housing benefit bill and the 5 million-strong social housing waiting list – but would crucially stimulate the economy (and particularly the crisis-hit construction sector) and create jobs. Again, Ed Balls has proposed using proceeds from the 4G sale to build 100,000 “affordable” homes – but this would not meet our housing needs (and in any case, “affordable” to whom?)

When dealing with such a dramatic increase in long-term unemployment in a short space of time, Labour’s response has to focus on reversing the trashing of secure full-time work. Six month-long placements on poverty wages – framed as being tough on claimants – will not address this. But the future of our communities depends on radical answers.

  • stu

    why not a guaranteed job from government for anyone unemployed at a rate £2 below minimum wage? everybody gets to work, there is no reason to not take a proper job in the private sector if you find one. no-one starves, no-one languishes on benefits.

    • Redshift1

      £2 below the minimum wage?!

    • Alexwilliamz

      How about at the minimum wage?

  • http://twitter.com/Edenkulig Eden K

    Spot on as usual, Owen.

  • s_o_b

    Just a couple of small comments-

    1) ” One in 12 university graduates are without work after six months, and a third are are in non-graduate jobs – a jump from a quarter a decade ago.” – could this be anything to do with the huge increase in the numbers of graduates over the last decade?

    2) Once again, Balls has come up with a way to spend other peoples’ money. Has he learned nothing? Ever since Brown’s raid on dividend tax treatment, UK pensions have gone from being the envy of Europe to a clusterf#ck. You cannot expect people to save into pensions in sufficient numbers to make a difference if you keep changing the rules. Still no answer to the charge that the private sector is paying for public sector pensions that it can no longer afford. Fair? Bollox.

    • Redshift1

      On point 2, what part of giving a private sector company a pile of money to push people into jobs that don’t pay (and therefore don’t produce tax income) and generally be less effective at getting them jobs than the job centre is good value for money? This is the nature of the government’s work programme. This is the biggest waste of taxpayers money possible. Yet you have a go at Ed Balls?

      Ed Balls’ suggestion is the expansion of a successful scheme – the Future Jobs Fund – that the government scrapped.

    • Alexwilliamz

      On point 1, or the failure of successive gvts to create an economy to employ all these graduates that we are creating. At the end of the day no one is taking risks and employing a straight from uni graduate is always risky as unsurprisingly for anyone in business an academic training does not guarantee competency in the work place. This is not to say that degrees are bad or that students are stupid, just that academic qualifications and conformity are not always what ma y in the work place want. Add into that the lack of willingness (understandably in some ways) of businesses to invest in training, and they are running after a small group of people.

  • http://www.facebook.com/people/Mike-Homfray/510980099 Mike Homfray

    Of course those placements aren’t the entire answer – but given that employers just don’t want to know about anyone unemployed for 2 years, it is a sensible scheme. the FJF worked well.

  • Redshift1

    I agree with you (as per usual) but I think a lot of your point is about message rather than content.

    As far as Ball’s actual proposals go I don’t have much of a problem with it. It’s essentially the Future Jobs Fund but rolled out to all age groups rather than just the under-25s.

    When you look at what happens to people when unemployed at the moment (like I was not that long ago). They are getting forced out of the job centre into the work programme where they push you not only into workfare but into the hands of dodgy agency firms or daft 8-hour-a-week jobs that clearly aren’t sustainable employment. Best case scenario they simply do sod all with you – but which obviously from a taxpayers point of view is a ridiculous waste of money, given to these private parasites like A4e. Balls’ proposal would actually have far-reaching consequences making the state responsible for finding people work, rather than putting all the emphasis on the claimant. As you say, its not down to the claimants fecklessness or otherwise, its the economy and lack of government action.

    I share your concerns about the way this is being presented however.

    • http://www.facebook.com/profile.php?id=715486331 Alex Otley

      The message is important though – playing up the ‘tough on scroungers’ thing will only get Labour so far. Much better to focus primarily on a positive message of full employment than negative ‘scrounger’-bashing. Constantly talking about fraud and scroungers just legitimises the right wing misinformation.

      • Redshift1

        Agreed, I’m just pointing out that actually the policy itself is pretty good but that’s being missed by some in the party/on the left because of the way its being presented

      • AlanGiles

        If it wasn’t so sad, it would be funny to hear the likes of Duncan-Smith, Schapps, Balls and his wife, Byrne etc etc etc complain about “scroungers”, when you remember their part in the expenses scandal – scrounging on a massive scale. Hypocrites.

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  • kb32904

    Owen you really can’t blame the message for the way a journalist has presented it! Patrick Wintour should be a ‘friendly’ journo, writing as he does is a supposed ‘left-leaning’ paper but he simply toes the government line. Have a hunt round t’internet and you’ll find lots of ‘lefties’ complaining about the journalistic tendencies of the Graun.

    Ok I’m lucky to have never been on any of these schemes but from what I have read, the difference between the two programmes is that under Labour the work they do is rewarded with actual wages (minimum wage ok but at its a start) whereas the Tories pay just JSA for a weeks work.

    I agree that the living wage would be better but Labour has to find ways to fund it from government funds and to have presented this policy uncosted would have been a wonderful gift to Double-dip Dave.

    I hope Labour have learnt that the Tories and the media will twist every announcement, skew every argument and lose all nuance when discussing policy.

  • disqus_TRQGMHFuDj

    Do you mean a 46% increase (146% of the figure two years ago), or 146% increase, the figures are very different! The figures from the ONS (333k-449k) suggest the former.

    • Alex

      Owen Jones gets it wrong again?

      Quelle surprise!

  • TheOpensideFlanker

    The problem with you, Owen, is you make such sweeping judgments and statements as to preclude your being taken seriously.

    For instance:

    ‘That’s not down to an inexplicable 146% increase in
    laziness and fecklessness in a short space of time, as right-wing
    politicians and journalists would have us believe.’

    Which ‘right-wing politicians and journalists’ have said this? Can you show some sources and provide links?

    The other question I have for you is this: if it is so easy to create jobs (and everyone knows that most jobs are created in small businesses) why not start a small business? This is a serious question. You could get a book out of it: ‘Creating jobs the OwenJones Way’. Probably the BBC would turn it into a TV series. Come on, if it’s that easy, do it.

    • Redshift1

      To be fair those that blame unemployment on laziness are logically saying that there has been a spontaneous wave of fecklessness gripping the nation since late 2008….

      Its ridicule; but its perfectly justified.

    • Brumanuensis
      • http://owsblog.blogspot.com Span Ows

        Unfortunately none of those links proves anything and does not answer OpensideFlanker’s question. Now, perhaps a link that shows what someone actually says and not some 3rd hand interpretation is what is needed.

        • TheOpensideFlanker

          Span – the problem with Owen and many others (and it’s a problem that exists on the right, as well) is that they are so consumed by hatred for the ‘other side’ that they don’t stop to consider whether the words they write are actually hinged to reality at any point. It’s far easier to demonise ‘right wing journalists and politicians’ (or other bogeymen of your choice) than actually to solve what do seem to be intractable problems.

          ‘The right hate the poor’: it’s a seductive and reductive analysis, but unfortunately (in my experience) it’s completely false.

          For what it’s worth, I’m an old school Conservative (though liberal on social issues). I have no ‘hatred’ of the unemployed, or the poor (I’ve been poor), or anyone else. Why would I?

          I just don’t believe that the state can really provide people with meaningful jobs, beyond the necessary. Maybe I’m wrong, but it’s an honestly held and non-hate motivated opinion.

          I wish there were an easy way to help the unemployed, but the fact is there isn’t: work, when you first start, is often menial, boring and badly paid, and you sometimes have to move to the next city, or the next city after that, to find it. I did it, and so have millions of others.

          I have lived and worked in a variety of jobs through several recessions. In the 1980s, I worked as a shot-blaster – a truly unpleasant job, admittedly, but one that paid well – and saw how hard it was to recruit people as pot lifters (lifting bags of grit into the blast pot) from the ranks of the unemployed.

          Guys would turn up, do a day (during which they moaned and were highly ineffective, despite the job being utterly unskilled), and then never reappear. The only conclusion you could draw was that those particular people *were* lazy.

          However, it is very obviously not the case that all unemployed people are lazy – many are desperate for work.

          I do hate the counsel of despair I see so often. Working in a menial job – even as a ‘burger flipper’, something else I’ve done – is not a permanent state. You can and will move on and up to something better, leaving that job open to another person. I wish more young people understood that.

  • http://www.facebook.com/peter.kenyon.169 Peter Kenyon

    It’s the economic and social ignorance which is most shocking. Here’s my take http://tinyurl.com/a8cm48j

  • Amber_Star

    Research published by the TUC today shows that widespread hostility to welfare – which lacks precedent in previous economic crises – is down to pervasive myths about the level of benefits and who gets them.

    ——————-

    Look no further than Byrne when asking why these myths are so pervasive.

    This very welcome reincarnation of the future jobs fund could simply have been framed as “fair”. Whose idea was it to add the entirely unnecessary “tough”?

  • Daniel Speight

    The worse of it is that we end up blaming the victims rather the criminals. The multi-generation welfare dependency didn’t just happen by itself, our political class did this. They deindustrialised the country including shutting down our mining. (A proof that other options were available can be seen by looking at Germany and France.) They were happy to hide the numbers on disability and other scams and they were also happy to open the labour market to EU workers. The minute we go into recession they tell us to blame the scroungers. Thatcher may have started it, but the Blair governments turned a blind eye to the problem. Our politicians just lied to us and continue to do so.

  • George Davidson

    perhaps if we hadnt made the terminally short sighted move to allow several million foreigners into the country in the last few years, the working classes in the UK would ALL be in work and pay and conditions for those of us who work for a living (ie up at 6am, 8 hour days, 5-6 days a week) would be improving through businesses competing for a limited resource RATHER THAN static demand for an ever growing resource.

  • Dave Postles
  • http://owsblog.blogspot.com Span Ows

    Long-term unemployment has exploded in the last 2 years: a gut-wrenching 146% increase. Not 2 years. This is since 2008.

  • http://www.economania.co.uk Bill Kruse

    Be nice if Labour could have some conversations about what they’ll be doing to tackle major-league tax-dodging. The odd paltry few quid spent on welfare pales by comparison. And then there’s the banking industry, effectively handed a £34 billion subsidy annually from their right to create the form of money called credit. Not even a whisper of Labour turning into a serious political party at all on that score. Is it any wonder fewer and fewer vote?

  • http://twitter.com/waterwards dave stone

    Good words, Owen. The absence of backbone in Labour’s opposition is shameful. The government front bench – millionaires row, in the words of one Labour wit – are joined by the opposition front bench, packed with Labour’s careerist elite, in a crackdown on claimants – the most vulnerable people in the U.K.

    If this is a foretaste of what’s to come when the mayhem really begins in April then I suggest we all start making arrangements to emigrate. If your only resource is a rowing boat then get ready to row. Anywhere’s going to be better than here.

  • http://twitter.com/bombayisgreat Andrew M Amesbury

    Owen Jones is mistaken in his analysis of German economic success.
    This is not due to the German government picking winners, but is because the
    German system does not favour mergers and acquisitions – this means that many
    more small and medium businesses in Germany are family enterprises, and these
    tend to have a long timescale on investment (literally for future generations)
    rather than the quick-profit short term economic culture that has arisen in the
    United Kingdom. If you are interested in who created the framework that
    has allowed mergers and acquisitions (including hostile takeovers) in the
    United Kingdom you need to look at the policies introduced by Tony Benn when
    Minister of Technology in the 1960s and Secretary of State for Industry in the
    1970s – but of course it is easier to blame the wicked Tories for everything
    instead of acknowledging the profound economic illiteracy that exists at the
    heart of the Labour Party.

  • Brumanuensis

    Meanwhile, the IFS has another go at Osborne’s child benefit ‘reform’:

    http://www.guardian.co.uk/society/2013/jan/04/child-benefit-reform-tax-rate

  • Wanzle

    Labour will never win the election by out-toughing the Tories on welfare, but we could lose it by being perceived as too soft. That’s why the “tough” rhetoric is important.

    And the problem with paying the Living Wage to those on the compuslory job scheme is that many jobs pay less than the Living Wage. It’s not fair to pay the long-term unemployed more than many who have worked throughout the recession.

  • rekrab

    Ain’t the idea rubbing against the grain in terms of false security and firms ending permanent posts for work experience, not to mentions these so-called posts wont be able to join a trade union nor get involved in disputes.

    • Redshift1

      Noone can bar you from joining a trade union…whether they can be involved in disputes or not will depend on a) the detail of the proposal and b) the nature of the dispute.

    • jaime taurosangastre candelas

      Derek,

      if someone is serious about getting on in life, has been unemployed for a time and gets a new job, the last thing they should be doing is getting involved with workplace disputes in their initial or probationary 6 months of work with a new employer. It does not matter if the unions are right or wrong in a dispute, putting yourself forward as a striker is unlikely to lead to a permanent offer of work.

      That is just good sense, before you and I begin to disagree on whether it is a sensible thing for any individual to belong to a trade union or not.

      • rekrab

        Jaime, that’s the point? IT’S UNLIKELY THESE UNDER VALUED CONTRACTORS would be in a position to support any industrial dispute, a six month contract wont include annual holiday rights nor pension rights and might even exclude these individuals from bonus rights also.

        If their employed on a minimum wage level and the general level is above, that alone becomes a conflict of interest and goes against the social chapter of pay equality.I think it’s pretty thin, most unemployed people are yearning for a future chancellor to voice a real offer of full time employment, not some 50% reduction on a policy labour once had? re-open the mines, re-nationalise the railways and create more not for profit companies.

        Somehow this crisis has landed at the feet of the most vulnerable? why aren’t the banks being held to account?

        Happy newyear Jaime!

  • http://twitter.com/Janiete Janet Edwards

    I would question whether the story was put to the Guardian in the way they reported it. Let’s not forget the Liberal Democrat supporting Guardian has its own agenda in damaging public support for Labour. We should ignore the emotive headline and evaluate the policy on its own merits.

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  • AlanGiles

    It is good to see that Owen and Tony Parsons in todays Daily Mirror is doing Byrne’s work for him:

    http://www.mirror.co.uk/news/uk-news/tony-parsons-on-the-disabled-they-are-not-spongers-1519008

    Just too bad LB isn’t up to the job of doing it himself

  • Winston_from_the_Ministry

    Can you have a dramatic increase of long term employment in a short space of time?

    Surely by it’s very definition it is people remaining unemployed rather than becoming so?

    To be honest it doesn’t matter either way, anyone who places such faith in Ed Balls is scraping the bottom of the credibility barrel already.

  • ManchesterMaddy

    The problem with your articles, Owen, is that they aren’t balanced and this detracts from how persuasive they are. EG:

    “That’s not down to an inexplicable 146% increase in laziness and fecklessness in a short space of time, as right-wing politicians and journalists would have us believe. It is a direct result of the catastrophic austerity programme of this Government which has sucked growth and demand out of the economy.”

    Do you seriously believe that two years of Tory policies are the sole cause of the present economic situation and that it has nothing to do with the prior 13 years of Labour government? That Labour handed the Tories a golden economic inheritance which they have now squandered?

  • http://www.facebook.com/thomas.e.pritchard Thomas Edward Pritchard

    Owen, boy are you brave and intelligent to be able to set up a straw man argument and knock it down. Meanwhile you are happy for people working on minimum wage to be taxed to pay benefits worth more than the minimum wage to those who don’t work. You are also happy to have those in work see their real incomes fall as wage increases fail to match pace with inflation, while those who don’t work are rewarded with index linked increases.

    You are on the side of the skivers, not the strivers, and ultimately, even you can’t justify that to yourself, let alone those who pay tax.

  • http://www.facebook.com/kerrybakerbaker Kerry Baker

    My concerns exactly. My understanding is Labour are not in fact going to be paying National Minimum Wage as is suggested by Labour spin. The employee will be required to perform 35 hours work but only receive payment for 25 hours at National Minimum Wage. Labour the working poor of this Country require a living wage, not a promise that is beginning to stink of Tory Workfare.

  • http://www.facebook.com/elspeth.parris Elspeth Parris

    @google-edb3ed6135928d8aa28904ba388de4d0:disqus – in general you appear to be sympathising with the victims of current policy but I have to question ‘disability and other scams’ – that implies that you think that disability is a scam. Most disabled people are either completely unable to work or need some support to find a work situation which can enable them to work – which, especially since the loss of so many Remploy jobs, just isn’t there.

  • John M

    I’m confused. Where the hell are you going to build the 1-3 million houses for those 5 million homeless you’re claiming are on the list?

    Can you build them all somewhere up north please? We need regeneration up there more than anywhere you know.

  • robertcp

    A guaranteed job on the minimum wage for the long-term unemployed is clearly a good idea. Who cares whether it is ‘tough’?

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  • Austin Barry

    It is intellectually dishonest to write a piece about unemployment without discussing immigration, however distasteful that may be to Owen’s sensibilities.

  • John Reid

    A TUC poll show the public views on Welfare,thats the same TUC who after the 92 eelction found by a survey, the reason they believed Labour had lost was the manifesto wasn’t elft wing enough,

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