Why are the Labour leadership joining a race to the bottom on benefits?


Ed Miliband’s speech last month on welfare Social Security was well received both inside and outside of the party, balancing a need to keep welfare spending down, with a realisation that housing costs – both social housing and in the private rented sector – are largely responsible for spiralling welfare bills.

The party isn’t quite ready to commit to the massive housebuilding programme that’s undoubtedly needed, but I full expect that to be rectified before the next election.

The cost of housing was also at the centre of Labour’s criticism of the “benefit cap”, with Liam Byrne rightly pointing out that an overall cap on benefits wasn’t an idea without merit, but that vastly variable housing costs across the country mean that under the Tory system the poor would be pushed out of inner London whilst they’d be able to afford decent housing in other parts of the country, saying:

“While all that £500 a week might get you in central London is a one-bedroom apartment, in Rotherham, Yorkshire it would get you a six-bedroom house. How can a ‘one-size-fits-all’ cap be fair to working people in both London and Rotherham?”

That was a coherent, if at times uncomfortable, position for the Labour leadership to take on the benefit cap. It’s not clear that’s the party’s position anymore. Whilst Byrne argued on BBC News this morning that we need “a cap that is different in London to the rest of the country”, he was careful not to use the word “higher”, opening up the possibility that Labour backs a £26k (or less) cap in London, and a far lower cap elsewhere.

Worryingly, it seems that Byrne has decided that rather than being ideologically driven, ham-fisted and with unforseen social costs to those living in areas with greater housing costs, the problem is in fact that the benefit cap isn’t tough enough, as George Eaton has noted over at the New Statesman.

For those hoping for a more nuanced position from Labour on welfare – please look away now.

Byrne this morning released a statement arguing that:

“Ministers have bodged the rules so the cap won’t affect Britain’s 4,000 largest families and it does nothing to stop people living a life on welfare.”

Whilst I personally find the idea of large families being forced to live on the meagre helpings that the British state doles out deeply unpleasant (because these families are likely to live in deprivation, not the warped luxury that the Daily Mail might have you believe), I don’t believe that it makes sense to draft policy for a whole society on the basis of a tiny percentage of those affected. By making Labour’s critique about the system not being hard enough on a small number of large families, Byrne is tacitly buying into the damaging rhetoric of the right-wing media that serves to trash our welfare system and remove support for the whole welfare state by-proxy.

No-one wants to see people trapped on the dole for years at a time as Byrne has rightly argued today, not because it’s bad for the state (because it is) but because it’s dreadful for those who are out of work. The fact is that the concept of a “culture of worklessness” is total and utter nonsense – as a report by the Joseph Rowntree Foundation proved last year. We know that evidence might not mean much to IDS (who “believes” things when he can’t prove them) but I had hoped for a little greater intellectual, fact-driven rigour from the Labour benches – Byrne should no better than to talk about people of “living a life on welfare” when the truth is there are no jobs to go into, and those that are being created are badly paid.

After all, I doubt many people joined the Labour Party for the politics of turning a tiny proportion of the population into bogeymen to win votes off the back of. It’s bad politics, and is a recipe for rubbish policy-making.

With the Tories openly admitting that the benefit cap isn’t about bringing costs down, it’s clear that rather than the “fairness” which they believe will be engendered in the system, many poor people who due to no fault of their own are out of work, and who already struggle to keep themselves afloat in expensive rented housing ( with little or no security and the painful choice between heating and eating) will be punished further.

And after today’s performance from Byrne, it’s hard not to believe that Labour has joined this cruel and unusual race to the bottom too, at least in a rhetorical sense.

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