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Food banks are victims of social ignorance

1 Apr

Conservatives just don’t seem to get food banks. Last week Liam Marshall-Ascough, a Tory councillor in Crawley, told a local council meeting food poverty was not an issue because ‘you try booking a restaurant in Crawley on a Friday or Saturday night. You can’t do it’.

Earlier this month the Trussell Trust, which has links to over 400 food banks across the UK, revealed a dramatic increase in the use of food banks in Scotland. The Trust’s Ewan Gurr cited a number of reasons for this trend, including welfare reforms and the cost of living. The government responded by bizarrely claiming food banks were creating their own demand with offers of free food.

There seems to be an astonishing amount of ignorance and class privilege going on here.

It is the same ignorance that compelled Iain Duncan Smith, the Work and Pensions Secretary, to sneak out of a Parliamentary debate on food banks in December. Pressure for the debate had not begun in Parliament, but as the result of a petition signed by more than 140,000 people.

Mr Marshall-Ascough also said ‘there is a £26,000 benefits cap’ adding ‘there is something wrong if they can’t live on that’. Who the councillor thinks ‘they’ are is not clear from the report in the Crawley News . Does he perhaps believe in an underclass of workshy graspers all living comfortably on £26,000 a year?

Food banks are not free supermarkets and most require a voucher or referral from the relevant authorities before access to much needed supplies is granted. It is difficult to believe the government does not know this, so to claim food banks are creating their own demand is either cynical politicking or astonishing social ignorance.

The Trussell Trust’s website reports that for the 2012/13 financial year more than 345,000 people needed the food they supplied. This is an increase of more than 200,000 on the previous year, with the top four reasons for needing emergency food being benefits delays, low income, changes to benefits and debt. None of this matters of course, because ‘you try booking a restaurant in Crawley on a Friday or Saturday night’.

We live in a society where 13 million people are classed as living in poverty. This is around 20% of the population. According to the Joseph Rowntree Foundation more than half of this number are part of working families. The Foundation’s Julia Unwin told the BBC last year of a labour market which offered ‘little security and paltry wages that are insufficient to make ends meet’. A TUC report released this year found one in five UK workers take home less than a living wage, with the figure in some Parliamentary constituencies rising to almost half.

The comfortably off, like Mr Marshall-Ascough, do not see this world. The government, surrounded as it is by the London property bubble, do not see it either, if they even want to at all. As the Guardian’s Polly Toynbee points out, cutting corporation tax, tax collectors and VAT inspectors are the actions of a government who would rather the state did as little as possible. Perhaps this sounds appealing to the Liam Marshall-Ascoughs of this world – who do not need a safety net to fall back on. But to millions of people it means scraping by on less and less.

We now live in one of the most unequal societies in the world. Food banks are only a symptom of this, but talk of table reservations in the face of food poverty is an ignorance we can no longer tolerate.



Youtube credit: video originally posted by Glynne Powell


Poor people do not have rubbish genes

16 Oct

Image by JFantasy, via Wikimedia commons

If you struggled at school, or just missed out on the socially acceptable number of GCSE grades, a senior advisor in the Department for Education may have worked out where everything went wrong. The short answer? You’ve got rubbish genes.

The long answer is a little more complicated. Dominic Cummings, a senior advisor to Secretary of Education Michael Gove, has produced a report which seems to set out his own personal vision for our education system – and it slots in nicely somewhere between scary and alarming. In a thesis that dismisses the current education system as mediocre, Mr Cummings explains in the course of 250 pages that the Department of Education should really only employ a fraction of the staff it does. The advisor’s preferred alternative seems to be a market in education (because transforming a public good into a market is how we ended up with world famous low energy bills).

Bizarrely, the advisor also claims that ‘the largest factor’ affecting a child’s performance has been shown to be genetics. To back up this claim Mr Cummings lists a number of key statistics showing the ‘heritability’ of test performance between parents and children, which seem to show a correlation. I would point out to Mr Cummings that he may have mistaken correlation for causation, but then that might be my own bargain bucket genes getting the best of me.

Do Mr Cummings’ claims match up with other statistics on education performance? Research by the Education and Social Research Council shows 21% of the poorest fifth of school children leave secondary education with at least five good GCSEs. The equivalent figure for the wealthiest fifth is 75%. From Cummings’ position, isn’t the only conclusion we can draw that poor children do worse than wealthy children because they are genetically less intelligent?

Are we to presume that proximity to hard cash has a positive impact on genetics? Are poor children likely to struggle more at school because they come from a genetic line of other poor people? Or is the answer, far more obviously, that wealth is a strong social factor in how well a child is likely to do at school and beyond? This thesis has the stench of genetic destiny to it, and feels almost Victorian in its belief in the importance of biological factors to intelligence and life chances.

In a retort to the thesis, Guardian columnist Polly Toynbee spoke to geneticist Professor Steve Jones about Cummings’ thesis. The answer she received was that ‘success and failure depend far more on the economic than the genetic accidents of birth’. Well that’s a surprise – life chances are affected by wealth and influence. Who knew?

But as Mr Cummings (who is not a trained geneticist) insists ‘Most of those that now dominate discussions on social mobility entirely ignore genetics and therefore their arguments are at best misleading and often worthless’. Who are we to believe? Should it be the trained professor of genetics or a political advisor accused of using ‘obscene and intimidating language’?

In an article for the Telegraph Professor Jones sets out why environment is a far more important factor than genetics, seemingly putting to rest any chance of Mr Cummings’ thesis becoming government policy. But of course Dominic Cummings has been an advisor to Michael Gove since 2011 and is a member of the education secretary’s inner circle. His hands have been all over education policy for two years.

The UK is one of the worst countries in the developed world for social mobility, scoring only half as well as both Canada and Australia in a recent study. This is a social problem, not a problem of DNA and chromosomes. Arguments like those of Mr Cummings, which claim genetic destiny disproves the need educators to consider social and economic problems when teaching children, are not only unhelpful but callous. Let’s hope this report finds its way to the back of a government filing cabinet never to be seen again.

Ed is not our nation’s salvation

27 Sep

Photo credit: Ed Miliband

Photo credit: Ed Miliband

This week, three years after becoming leader of the Labour party, Ed Miliband finally rolled out some policy. At this stage though it may be too little too late for those affected by coalition austerity.

Not that there is anything too disagreeable amongst the main headline announcements at this week’s Labour Party conference. The three that seem to have drawn the most attention on front pages and live rolling news are thus: the abolition of the ‘bedroom tax’, the announcement of free childcare for working parents, and a two year freeze on energy prices. Miliband’s tag team partner Ed Balls also proposed putting Labour’s next election manifesto to the Office of Budgetary Responsibility in what is likely an effort to earn some economic legitimacy.

Freezing energy prices will not go down well with the big six energy companies of course. The independent reported on Wednesday how energy firm Centrica had lost £950 million in its value on the stock exchange following the Labour leader’s announcement. The newspaper said ‘shareholders are concerned that their dividends will suffer as a result of the bill freeze’. This serves only to make the shareholders seems selfish and the Stock Exchange appear fickle.

If Centrica are expecting us to feel sympathy they are probably hoping we’ve all forgotten about the £16 million they could afford to pay their executives last year. The energy price freeze could be a lifeline for working people who have been hurt by the rising cost of living. With further energy price hikes imminent (most sources claim an increase of 5 to 10 per cent) the big six will certainly not be empty pocketed come the next election. It’s fairer they take the hit than struggling households.

The less said about the ‘bedroom tax’ the better. Freedom of information requests revealed last week that in the first four months of the ‘bedroom tax’ a third of council house tenants have found themselves in arrears. The obvious problem, a shortage of affordable housing, is known but is not being dealt with properly.

Miliband’s policies are well intentioned and will improve many people’s lives, but they are also calculated. The nod by Jonathan Freedland in the Guardian on Tuesday to Miliband’s focus testing of his energy price freeze is revealing. This Labour conference isn’t the beginning of a slew of announcements that will turn back the tide of welfare abusing Tory policy. Cameron and Osborne have still managed to make a disastrous austerity policy seem like it’s working (spoiler – it’s not).

I am certainly not in Miliband’s corner, but I can see he is hamstrung by the election cycle and Tory spin on the economy. Instead of fighting every Tory attack on the public services millions depend upon, Miliband has to concentrate on one day in May 2015. Much like the American television industry with its new TV shows, our political parties big ideas seem destined always to be pumped out over the space of just a few weeks each autumn.

Despite Toby Young’s assertion that Red Ed simply re-announced the 1983 Labour manifesto this week he need not panic (though it must be said the list he presents is probably far less repugnant than he thinks, and would likely receive greater public support than it did in the 80s). Miliband is trapped in a political climate where calling for a fairer tax system and a better welfare state is labelled the ‘politics of envy’.

The present terms of political debate will never allow Miliaband to truly follow through on this week’s announcements. This needs to change.

A private Royal Mail is the wrong move

22 Sep

Photo by Elliott Brown, via Flickr

Photo by Elliott Brown, via Flickr

In many ways the Royal Mail’s relationship with privatisation has been similar to that of James Bond’s relationship with a super villain. No matter how many times it seems like privatisation is going to win the Royal Mail clings on to public ownership.

‘Do you expect me to talk?’ says the postman strapped to the table as the laser beam works its way towards his torso.

‘No, I expect you to be floated on the stock exchange’ is the reply. Well, something like that anyway.

This time, however, it looks like even a postal worker’s strike won’t stop the coalition government privatising the Royal Mail.

Ironically, just as the chances of the public sell off are at their highest, the excuses for privatisation seem to be at their weakest. The old argument about our public postal service making a heavy loss has been dismissed, with profits for the year ending in March 2013 at more than £400 million. The rational for the current privatisation effort seems to rest on a purported need for investment and improved efficiency.

In a piece declaring his general opposition to privatisation, former labour minister Brian Wilson conceded that Royal Mail did need huge investment to compete with ‘expansionist’ postal companies from elsewhere – in particular Wilson singled out Germany and the Netherlands. Wilson is right to oppose this privatisation, but given the £400 million profit, double that of the previous year, the Royal Mail already seems to be competing fairly well. Meanwhile, as Will Hutton points out, when it comes to major investment projects private owners often require significant financial guarantees from government. The plan to achieve universal broadband coverage in the UK has seen a government capital investment of £1.2 billion, along with significantly less from the privatised British Telecom.

The issue of postal companies from Europe seems to be the point on which the current privatisation effort is hinged. It is true that both Germany and the Netherlands have privatised postal services. Unfortunately neither of them can be considered an argument for the Royal Mail to follow suit. Allow me to take a brief detour as I try to present a rough guide to the Dutch postal service.

In 2012 PostNL, the company with a near monopoly on the Dutch postal system, saw a turnover of over €4 billion. In February it announced its intention to cut more jobs in an effort to save a further €70 million and eventually start paying dividends to its shareholders again. This effort has also seen a ‘reorganisation’ involving the closure of local sorting centres in a centralisation exercise that will likely end in the gloomily predictable result of poorer service and overworked and underpaid workers.

Unfortunately you are unlikely to hear about this on the six o’clock news here in the UK. Many media outlets are too busy holding up the Netherlands (along with Germany) as examples of why the near 500 year old Royal Mail needs to be privatised pronto.  No one has achieved this better than Alex Massie of the Spectator, who masterfully points out ‘if Germany and the Netherlands can privatise their postal services – and make them work – there’s little reason to suppose that doing so in Britain is simply a question of crazy free market ideologues running amok’. Ironically, the sword Massie uses to slay his straw man argument about the rampant free market is weaker than the point his is trying to dismiss.

Of course there is the question of the German postal service, which has been privatised almost as long as its Dutch counterpart. But Deutsche Post DHL and its competitors in Germany are regulated by an entire Act passed by the German parliament to ensure a quality of service. Thanks in part to this regulation Deutsche Post behaves fairly and responsibly to its employees in Germany and Europe, even agreeing to a pay rise for more than 130,000 workers. Britain has a different attitude to industrial relations. It is unlikely similar protection will be afforded to a privatised Royal Mail and the Universal Service Obligation, which ensures letter delivery six days a week and a uniformity of price regardless of geography, will likely become a casualty of the private sectors need for profit.

Outside Europe, the German postal giant has reportedly behaved less fairly. A 2012 international report claims Deutsche Post DHL ‘systematically aims to limit freedom of association, collective bargaining and the presence of a union within its workforce’.

While the Royal Mail is currently making profits in excess of £400 million, a constant excuse for its privatisation over the years has been its inability to make money. This deeply mistakes the point of a public service. The profit provided by a public service is not economic, but social: being able to send a letter six days a week to every address in the country; having an affordable bus service which can get you to work on time even if you live on an unprofitable route.

If Royal Mail is privatised it will follow the same model as all such former public services: financial profits will be privatised and any need for risk or major investment will be shouldered by the state, or not at all. I don’t pretend that I can see into the future but  this has happened too many times before for me to expect a different result.

The government’s austerity project seems more like malice every day

27 Jun

By Chris Hansell

Photo by mjtmail (tiggy) via Flickr

Photo by mjtmail (tiggy) via Flickr

Question Time, the BBC’s flagship political debate programme, can be both intriguing and insufferable. Last week’s edition, with the Lib Dem’s Ed Davey and Labour’s Harriet Harmon using up lots of words but saying very little, was a paint-by-numbers example of this.

Dropping divisive comedian Russell Brand into the pot was not therefore unwelcome. It’s always nice to see someone on Question Time who isn’t weighing their every word against their own political ambition. But this post isn’t really about QT.

What I’d like to talk about is a comment that seemed to be ad-libbed by Brand. Speaking about the bankers and the crisis they created the comedian said ‘incompetence of that degree, with those kinds of consequences, is indistinguishable from malice.’

I haven’t decided whether I agree with this yet, but it’s an idea we should all give a lot of thought. Given the many people who have suffered, been plunged into poverty, had their safety nets yanked from beneath them, found themselves jobless, is there any difference between having caused this crisis through self-interest or ineptitude?

We should ask ourselves the same question about the calamitous economic policy of our dear Chancellor. On Wednesday George Osborne stood in the House of Commons and remarkably managed to surprise no one with another set of budget cuts. But at this point what can we really expect from a man who seems to lack the imagination of even an economist?

Way back in 2009, before the Cameron-Osborne Austerity project found its way into Downing Street, world renowned British economist David Blanchflower made an obvious point: ‘You don’t cut public spending in a recession’. The sense of this statement is obvious. If you have debts to pay back the absolute worst time to pay them off is when you have no money.

Even after four years you can feel Blanchflower’s exasperation when he says of the Tories’ austerity plan ‘I haven’t seen such blinding incompetence for a very long time’. There’s that word again: incompetence. But how many people really believe that anymore? Headlines from the 2013 spending review include a ten per cent cut to local government budgets, ten per cent from the Environment department and a new cap on welfare spending. This is just a slice of the cuts. Nearly every government department has seen reductions. A government department can seem a bit abstract but we shouldn’t forget how budget cuts will damage the services millions of us depend on every day.

Local councils will be next to useless once they have combined these latest cuts with the ones they already have to implement. The welfare safety net is clearly not something the millionaires and Eton alumni in Cabinet see as important. With the Work and Pensions budget slashed by nine and a half per cent and housing benefit and disability living allowance capped this message could not be clearer.

Yet can this economic policy be, as Blanchflower suspected in 2009, simply the result of economic incompetence? In May I wrote a blog post about the media buzz surrounding an IMF visit to the UK. Really it should not have been a big deal, but key members of the IMF had said some very surprising things about our economy. Someone else who wrote about the trip was Korean economist Ha-Joon Chang. Chang had this to say about our economic bind: ‘Current policies in the UK and other European countries are really about making poor people pay for the mistakes of the rich.’

For Chang the IMF’s trip showed that our government was persisting with a policy that unnecessarily hurt poorer people because the results would benefit the rich. I find it hard to disagree with this assessment when our Chancellor slashes vital public services so freely while multinational corporations are able to pay such low amounts of tax with only token political opposition.

Internet giant Google can pay only £6 million on UK generated profits of £2.6 billion while new university students must burden themselves with £9,000 a year course fees on top of living costs. Corporation tax is lowered by eight per cent in the space of three years but freezes to public sector pay and housing benefit make the cost of living more difficult to bear for hard working people.

When Russell Brand talked about incompetence and malice on Question Time last week he could just as easily have been talking about the policies of our government and our Chancellor. What has become clear though is that the UK’s grand austerity project is more about malice than incompetence.

Politicians look indignantly at big business

17 May

By Chris Hansell

Photo by graziano88

Photo by graziano88, via Flickr

What happens when politicians are feeling particularly hated and scorned? They have a bash at a group even more disliked and reviled.

This seems to be what took place at a hearing of the Public Accounts Committee in Parliament on Thursday, with MPs taking the collective chance to look indignant at big business.

The issue is plainly stated in the Independent: Google have paid only ‘£6 m in UK corporation tax in 2011 despite generating more than £3bn in advertising revenue in this country’. Now to ensure  there’s no risk of me breaking defamation laws (don’t worry – probably not a strong possibility) I should clarify a few titbits. Google’s Northern Europe boss Matt Brittin says while UK staff are involved in encouraging advertises to buy ad space the actual transaction of buying ad space takes place in Ireland.

What seems to have been at issue at the committee on Thursday is just how much of the ad selling process took place in the UK. Committee chair Margaret Hodge repeatedly talked of whistleblowers who offered payslips showing ‘substantial bonuses’ based on ‘sales’. As Mr Brittin was quoted as saying in the Telegraph “’the UK team are selling, but they are not closing’”. Still, legally speaking it seems that if the ad transaction takes place in Ireland it cannot be taxed in the UK. I’m not a legal expert.

This is not to say it is morally right. If, as Mrs Hodge claims, much of the ad selling process takes place in the UK then I think it is fair that it be taxed here as well. If what Mr Brittin says about selling and closing is true I imagine it would be quite hard for Google to generate the amount of ad revenue without the UK team. This is where the circle closes itself because the only people who can make the tax system fairer and more comprehensive are the people sitting in Parliament and looking aggrieved at Mr Brittin.

On the 17th of June the Prime Minister will host G8 leaders in Northern Ireland. One of the key points of discussion David Cameron says he intends to pursue is the issue of international tax law. Perhaps it’s time Mr Cameron pulls his finger out.

Here’s some extra content I’ve produced relating to the whole tax issue.

Some other articles worth reading on the subject:

Amazon and corporation tax

Google boss to meet Prime Minister

IMF visit sparks media buzz

9 May

By Chris Hansell

Photo by altogetherfool, via Flickr

Photo by altogetherfool, via Flickr

For the next two weeks the UK will be haunted by a gang of economists from the International Monetary Fund (IMF). The 67 year old organisation has let slip a few surprises in recent weeks, but the amount of media attention on the visit has also left me a little surprised.

At one time our Chancellor may have welcomed the visit, reasonably expecting a public pat on the back and a few positive column inches on the side for his austerity programme. This may not be the case for this visit. The IMF’s Chief Economist, Frenchman Olivier Blanchard, has recently been making comments suggesting the Chancellor needs to rethink his plan and perhaps ‘slow down’ the deficit reduction programme.

To ramp up the pressure on George Osborne the Trade Union Congress (TUC) craftily chose this week to publish a report on the economy. Some of its findings will have pleased union leaders, providing probably enough ammunition to last the entire two weeks of the IMF visit.

The news media have so far stuck to their respective political trenches on the IMF visit, churning out the kind of opinions and observations we have come to expect from each of them.

The Spectator likened the visit to an Ofsted inspection. Spectator blogger Isabel Hardman said IMF reports have tended to be ‘so oblique that anyone occupying any part of the political spectrum can find something to cheer them and something else with which to prod their enemies’. This is obviously intended to undermine the visitors before they have had the chance to say anything, but I find that I must agree despite myself.

The Chancellor will still not be getting my pity though, and the idea that Mr Osborne might feel sympathy for teachers seems a little comical considering the government’s education policy.

In a foreseeable move the Guardian married the IMF visit with the TUC report in an article that labelled the recent comments of Mr Blanchard and his colleagues as an ‘embarrassment for Osborne’. Economics reporter Katie Allen also described the UK economy as ‘flatlining’ and pointed to the IMF’s reduced forecast for UK growth.

IMF growth projections for 2013 and 2014 (Made in April)

IMF growth projections for 2013 and 2014 (Made in April)

The intention here is clear: point to how the IMF has cast doubt on the government’s austerity drive.  The intention of the Independent seems to be much the same in their article. Of course the IMF has spent decades producing forecasts and has often got things wrong. While I agree with the anti-austerity sentiment using IMF figures to build a case may not be the best strategy.

Before I move on I’d like to tackle one more example. Financial news website this is money has been showing up in my news searches a lot recently (isn’t my life just rock n roll?) so I thought I’d have a peek at what they say.

The website lines up a number of arguments the Chancellor could utilise against the IMF, but one nugget stood out for me. ‘Osborne’s hand has been strengthened by reports that more than forty global companies are considering moving to Britain to take advantage of low corporation tax rates’ the article says. One industry insider tells the website that this could raise £1 billion in tax revenue.

This is not the trump card it seems, and cuts to corporation tax are not really austerity policies. The cut of corporation tax from 28% earlier this year to 20% by 2015 will no doubt cost the Treasury so much a boost of £1 billion will be redundant.

Now let’s get to the point. You might have noticed in the first paragraph I said how surprising I have found all this coverage. Well, here’s why:

That an IMF visit warrants this much coverage confuses me. Don’t get me wrong – as someone well aware of the IMF’s less-than-polished record I am glad they’re being given the kind of scrutiny they should get every day of the year.  What confuses me is that so many news outlets have decided they should all cover the story at once.

A stuffy, Washington based institution that has usually only ever had real clout in developing countries pops in for a look around and it’s in almost every paper. Looking around perhaps it isn’t so confusing. The economic disaster that was Greece planted the IMF in the public consciousness for better or worse. Austerity has put the economy at the heart of the news cycle and everyone has an opinion. It will probably even decide the next general election.

In the meantime the economic debate is still open and despite everything else this at least is something we can be pleased about.

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