Is it enough just to denounce the Tory welfare cuts?

Since we left them alone in government, the Tories have ended housing benefit for the under 25s, frozen working age benefits for four years (effectively cutting them because inflation will slowly drive up the cost of living), and cut Employment and Support Allowance for new sick and disabled claimants by 30%.

They’ve introduced a minimum wage masquerading as a Living Wage, and even gone so far to rule that the full hourly rate should only be given to those over 25.

And they’ve nakedly pandered to their core vote by not touching certain wasteful benefits given to wealthy pensioners, most notably the winter fuel allowance.

And all this in the name of working people.

So that’s their vision, abhorrent as it is. But at least they have one.

What’s ours?

We all know that we want to be that distinctive, brave, credible and compassionate liberal force that Britain so badly needs. We all know that we need to inspire, that we need to think big and talk big.

Where better to start than with setting ourselves the challenge of designing a new progressive settlement that tackles poverty and inequality through the values of both social and liberal democracy?

Easy, right?

Well, we have to start somewhere, so how about this: I’d say we start with the difficult questions.

First, stricken with austerity, how on Earth can we find more money to spend on welfare without breaking the bank or cutting elsewhere?

Well, is it possible that British shoppers might prefer a brand that advertises proudly that its pays its fair share of taxes to the state? Can we increase tax revenues by making honest corporate behaviour profitable?

Or could we bring more money in by reforming the regressive council tax?

Can we encourage local councils to crowdfund key initiatives? To seek additional voluntary revenue from the most generous in order to help the least fortunate.

Second, how can we do more good with each pound that we spend on welfare?

Perhaps we could save in the long-term by investing in helping young people from low-income families avoid a lifetime of poverty.

Families already get child benefit for children who stay in full-time education between the ages of 16 and 20. But it’s not the families that risk a lifetime of poverty, it’s those pupils and those students. Let’s give young adults from poor families an equivalent benefit to help them stay in school.

Third, how can we inspire local, creative solutions in the worst-hit neighbourhoods and the most isolated communities?

Perhaps we can allow councils to borrow money not only to build more houses, but also to invest in social enterprises that employ and empower the poor.

Perhaps we can let volunteers convert the hours they spend building a better society into tax credits that ease the costs of doing good.

And yet, perhaps these ideas are terrible. After all, who on earth am I?

Well I’m one of this party’s 60,000 members, and one of the 100,000 we’ll have by the time the next election comes around.

Maybe these ideas aren’t the right ones. But what ideas have you got, yes you – and what ideas have your friends got? And sure, send them over in the comment thread – I’m keen to read them – but don’t stop there. Talk with your local party group, get your family’s ideas and your friends’ ideas, and make sure the party hears them.

We can dream glorious, inspiring dreams as a party – sure, and more inspiring than the rest of them too – but the only way we can build a new Britain is as a movement.

We will never be that distinctive new force until we start asking ourselves the difficult, frightening questions. So let’s get on with it.

* Jim Williams is the founder of Your Liberal Britain

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20 Comments

  • Geoffrey Payne 28th Sep '15 - 1:42pm

    Money spent on benefits is not money down the drain.
    It puts money in the pockets of people that because they are on low incomes will spend the money they have on food and other essentials in the local economy, which has a stimulus effect. People on higher incomes spend more their money on foreign holidays and on foreign investments, or they save money, all detracting from the stimulus effect their money.
    There are cuts you can make that do not hurt the economy by much, not replacing Trident for example.
    As far as the benefits cuts are concerned, they should be restored to how they were before the Tories got in.

  • Glenn Andrews 28th Sep '15 - 2:26pm

    Well long term, slashing the housing benefit dramatically by building a million or so council properties…. if people on low incomes have the low rents to match; spare cash will be flowing into the real economy.

  • Jim you have some really good ideas. I particularly like the idea of some kind of branding that would allow businesses to proudly let the public know that they pay their fair share of taxes to the state. It would be interesting to see how and if this could work, I suspect it would be all a bit too complicated but still a nice idea. The other idea that really caught my imagination is crowd funding for councils – I wonder if any council throughout the UK has ever tried this and if there are any examples where this has been successful or not.

  • Jim Williams 28th Sep '15 - 3:20pm

    Geoffrey – agreed on the value of benefits to the economy, but not that we should put the benefits system back to how it was in March. Winter fuel allowances for wealthy pensioners, for example? And are we really delivering the most support for the neediest with the money we’re spending?

    Glenn – really interested to see how far housing benefit could go down if we built 300,000 more homes, as Tim Farron wants to. I’d love to see some figures on this.

    Craig – thanks! Very kind of you to say so. Yes, I wonder how far some of these are workable, but it’s always worth putting crazy ideas out, just in case they happen to be practical after all. The crowdfunding one in particular seems an interesting avenue to me. Perhaps this could only work for short-term initiatives, or for special cases – but why ever not?

    Another I didn’t mention is to learn from Colorado’s present referendum. They’ve had a windfall on income from cannabis legalisation, and are asking the state’s voting public whether they should 1) give it back to the nascent marijuana industry to encourage its growth, or 2) spend it on education.

    I wonder whether our councils might be able to do something slightly different: e.g. ask the local population whether they’d be willing to pay £X more per month on their council tax in return for building more houses or revitalising a failing school.

    Again – perhaps a little too out there, but who knows – maybe not.

  • I know this is about *spending* but one must be careful that *spending* ends up in the right place. So for me the number one priority, perhaps especially so in an age of budget constraint (we could call it “compassionate austerity” perhaps 🙂 ) would be to see how to make the cost of living lower. And to start at the largest of household expenses – housing costs. Until we address the economic cycle of rent, more money in people’s pockets eventually translates into higher rents. Meaning that you’re eventually back at square one with people not having enough for a decent life beyond their shelter. Higher welfare = wealthier landlords!

  • On Danny Alexander, I would say, I’m pretty sure it was him whom a local Tory who happens to be a Treasury economist said had asked him to do some work evaluating Land Value Taxes. Can’t confirm it but I definitely remember it was not someone I’d have expected to ask for such a thing.

  • Because something may be a term of abuse in parts of the USA does not mean it’s a bad word. We probably would not want to call ourselves “liberals” on that basis. In the academic literature the entire system is universally known as the welfare state. We refer to economic welfare (not restricted to distribution by the state) too. Mind you, I do like the language of T H Marshall that what we are trying to create by subsidising individuals’ economic welfare is “social citizenship”.

  • Jim Williams 28th Sep '15 - 5:28pm

    Caracatus, Jock – thank you for the great ideas.

  • A Social Liberal 28th Sep '15 - 5:42pm

    Jock Coats said

    “Mind you, I do like the language of T H Marshall that what we are trying to create by subsidising individuals’ economic welfare is “social citizenship”. ”

    Indeed, and a reason to call it ‘Social Security’ as it used to be.

  • Philip Rolle 28th Sep '15 - 6:07pm

    You should campaign to reduce pension contribution tax relief. Better get in quick though, because George is going to do just that before very long.

    Or campaign for a new tax; treat inheritances as income in the hands of the recipient where they have not already been subject to inheritance tax.

    Treat non residents as taxable on their worldwide income unless they leave for ten years?

    Gifts to fall out of an estate after fifteen years instead of seven?

  • Ruth Bright 28th Sep '15 - 8:49pm

    Jim – how about reform of Attendance Allowance (disability benefit for over 65s) which gives money to people for care without any relationship or proof as to whether they buy in care or not. If is amazing how tough the regime is around pre-65 disability benefits but how lax it is around post 65 benefits.

  • nigel hunter 29th Sep '15 - 12:46am

    We should build cheap prefab houses that do not cost a fortune for low income people and charge low rent.
    They may be classed as “rabbit hutches” but when your income increases you can develop further or they can be added to later. Built by small building companies in small groups any where where land and planning permission ,( BLIGHT OF THE NATION) is available. Even built on and in companies land who can obtain the rent giving them aregular cash flow to grow and develop.

  • A Social Liberal 29th Sep '15 - 2:20am

    We should be arguing for austerity being aimed at the right targets instead of the poor and vulnerable. Every week there are reports of disabled people killing themselves because they have fallen foul of the benefits system whilst big business can seemingly decide whether they pay their fair share of taxes or not. We have the homeless being pushed out London boroughs because of the benefits cap, being replaced by wealthier people who do not have to rely on housing benefits who in turn cannot afford to buy a house, whilst the extremely wealthy get tax reductions.

    Austerity is predicated on the most vulnerable in society, whilst those least vulnerable get more and more from these pernicious government actions

  • Well, we’ll see what happens when the benefit cuts eat into disposable income in the next few months. It is worth remembering that austerity became fauxsterity in 2013 because it had been a dismal failure choking of a moderate recovery and taking the UK economy close to a triple dip. My view is that Osborne is a bit of a chancer and doesn’t really know what he’s doing. So I see lots of huffing and puffing after dismal Christmas economic figures and unemployment continues to creep up. It’s not just a matter of opposing benefit cuts has it is taking him to task over doing an appalling job. God only knows what will happen when the confused approach to the EU starts to cause banking jitters. So I’m kind of expecting lots of stuff about the weather and uncle Tom Cobley come March. We’ve just lost another industry, steel, by the way. I know some Lib Dems still feel wedded to the Conservatives, but really it’s time to finalise the divorce papers and come out of it with some dignity.

  • Ruth Bright. Many people are turned down for Attendance Allowance. Another complex form that the elderly need help to complete as they do not adequately state their needs.

  • Jim Williams 29th Sep '15 - 10:21am

    Guys – this is superb. Thank you for all the brilliant ideas. Got to love the LDV audience!

  • Ruth Bright 29th Sep '15 - 2:42pm

    Anne – I had six years filling those forms out for elderly people. No-one was ever turned down. The forms are a disaster. I really believe it would be possible to simplify the system and save money.

  • Matt (Bristol) 29th Sep '15 - 3:06pm

    Anne, I think the point Ruth is making is that after you apply for AA, there is no audit effective on how you spend it. I remember a lady who refused to spend her AA money on care, stating she wouldn’t be able to repair the cuckoo clock…

    Quite agree that AA is a mess, and that there is a hypocrisy in the ctonrsasting ways in which younger-persons and older-persons benefits are administered.

    I have long thought that housing benefit, council tax benefit and council tax itself should all be administered by the same regional or local authorities, and that should be combined with considerable latitude for said authority around banding, ‘bedroom tax’ etc. These are local/regional decisions, about local/regional property markets. The sin of the Coalition in this regard was to inpose one rule all all areas with no local accountability.

  • Ruth, you are quite right and DLA for the over sixty fives at present just carries on indefinitely if you have received it before you reach that age. However pensioners are gradually being assessed for PIP which has taken over from DLA so I’m sure that many of us will find our disability benefits reduced as a result. I don’t know how pensioners who just receive the basic pension are going to survive because life is just far more expensive if you have a disability no matter how old you are. I think we should be arguing for targeted benefits to make sure that scarce resources are given to those who really need them. However I am aware that previous posts on LDV have argued that this is not effective.

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