Dignity

An Old Boy of The Lanchester Review, Andrew Fisher writes:

“Handouts from the state do not nurture the same sense of self-reliant dignity”. Who said that? Margaret Thatcher? Norman Tebbit? George Osborne?

No, it was Labour leader Keir Starmer writing in The Sunday Telegraph this weekend. He added that while Labour “will never turn our backs on people who are struggling” he believes that “serving the interests of working people means understanding they want success more than state support”.

The thing is we all want success, but in a market-driven economy that is neither guaranteed nor within our own personal remit to deliver.

It was this rather obvious reality that led to building the modern welfare state. That post-war Labour government recognised that we have collective duties to each other in a society, and that a social safety net must be paid for collectively to ensure those in need did not suffer poverty, squalor or be at risk of higher incidence of disease.

In his Telegraph article, Starmer wrote: “it’s unusual for a Labour leader to put wealth creation front and centre.” That’s debatable, but what is uniquely unusual is for a Labour leader to be so indifferent to wealth distribution.

Despite unprecedented food bank use, rising child poverty and a record number of families living in temporary accommodation, the Labour manifesto promises next to nothing to boost social security. Not even unpicking the most pernicious Tory policies like the two-child limit, the bedroom tax or the household benefit cap.

Starmer has pledged that Labour “will not raise income tax, national insurance or VAT”, arguing that “it isn’t fair for working people to lose more of their money in a cost of living crisis.”

That’s fair enough, but it is wrong that he has also pledged not to raise taxes on capital gains, so far ruled out wealth taxes, and eschewed higher corporation tax (when UK corporations enjoy the lowest tax rates in the G7). The proceeds of what little growth we do have are accumulating in too few pockets.

It is uncontroversial to state that a lack of economic growth is holding back living standards. But economic growth alone does not deliver social justice. The Thatcher years delivered higher rates of economic growth on average than the New Labour years, but Thatcher’s tenure also saw unemployment peak at nearly four million and inequality double.

Conversely, the New Labour years saw child poverty and pensioner poverty fall dramatically. This didn’t happen magically, but because significant policies were put in place to make it so: tax credits, Sure Start, pension credit, and more.

Yes, dignity can come from work, but people out of work deserve dignity too. A vanishingly small number of people choose a life on benefits. The vast majority are in receipt of social security due to disability, ill-health or the lack of jobs.

Unemployment is rising and 1.5 million people are unemployed. There are currently only 900,000 vacancies across the country.

Many people cannot work because they are among the 7.6 million people on NHS waiting lists – either having to give up work or reduce their hours, often waiting in pain for treatment, while living on the lowest benefits in Europe and being demonised for their poverty.

Ignorant politicians and media pundits have for years peddled a myth that people can be “better off on benefits”. Try it. Give up work and see how much “better off” you are. You won’t be. And these pedlars of misinformation know that, which is why they don’t do it.

Being on benefits in the UK is a soul-destroying, impoverishing existence. Many disabled people who are unable to work live in abject poverty. According to The Trussell Trust, 7 in 10 food bank users are disabled, and disabled people are nearly three times more likely that non-disabled people to face food poverty.

Starmer should act to boost benefits immediately – as a minimum restoring the £20 per week uplift to universal credit and extending it to disability benefits. Equalising capital gains tax with income tax would pay for that with change to spare to scrap the two-child limit.

For any one of us, unemployment, ill-health or disability could be just around the corner. Dignity can not just be the preserve of those in work. It must be for everyone: children, people whose illness or disability prevents work, and pensioners too.

Labour used to recognise that. Starmer’s “changed Labour Party” does not.