It’s time for Liberal Democrats to fight for the worst-off in our country

Are we not already doing so? You may think so. The Pre-Manifesto motion passed at Bournemouth, F23 For a Fair Deal, demands in lines 93-94, ‘Repair the broken benefits social net and set a target of ending deep poverty within a decade.’

But the Media reporting the Conference didn’t attend to that part of the motion. And the Labour Party which we should surely be aiming to influence will remain unaware – unless we shout about that policy, which centres on our pledge at York to bring in a Guaranteed Basic Income and begin tackling poverty and ending the need for food banks within a decade. None of which will be known until we shout about it.

Meantime, the Tories are rampant in readiness actually to attack the poor. The Chancellor of the Exchequer, Jeremy Hunt, was quoted in Saturday’s Times as intending measures which would penalise the poorest. He said that the government was looking to overhaul the benefits system, which he described as “incredibly damaging to the economy and individuals.” He claimed that 100,000 people a year were moving off work into benefits “without any obligation to look for work”. That is patently untrue, because people claiming Universal Credit will be obliged to seek work to obtain the benefits if they are of working age and not unable to work for health reasons.

A single person aged over 25 on Universal Credit receives £368.74 a month. But the Joseph Rowntree Foundation reckons that not to live in poverty – that is 60% of median income – the basic rate should be £716.67 for a single person.

Some 41% of people on Universal Credit in June 2022 were in work. Of families in receipt of Universal Credit, 46% of them were living in poverty. The JRF cost of living tracker of October ’22 found that over a quarter of households receiving Universal Credit had experienced food insecurity in 2020-21, and more than half of the poorest fifth of households were in debt arrears.

Relevant to our motion on Housing passed at Conference last month (F31), JRF found that poverty among private renters increased from 32% in 2020-1 to 35% in 2021-2.

According to the JRF, 29% of the nation’s children are living in poverty. Contrary to statements by Rishi Sunak at PMQ, it says that over the last decade the number of children living in poverty has risen by 600,000.

Annual figures show unacceptable increases in poverty. The Government’s statement of annual average income of March 2023 gave the latest dire figures. In 2020-2021 14.4 million people were living in poverty (with less than 60% of median income), of whom 4.2 million were children, 8.1 million working-age adults, and 2.1 million pensioners. It showed that pensioner poverty had returned to pre-pandemic levels (18%), and the proportion of children in poverty had increased from 27% to 29%.

In-work poverty remains high: over half of people in poverty lived in a family with at least one adult in work – 54%. Over two-thirds of children in poverty lived in a working family. Poverty rates were especially high for certain communities of Asian origin: 49% in families headed by someone of Bangladeshi origin, and 53% for families with a Pakistani head.

A third of people living in a household with a disabled child were living in poverty – the highest level since 2008-9. Over a quarter of people in families where someone has a disability are in poverty, compared with one in five families where no-one is disabled. Almost half of all families with children living in the private rented sector were in poverty, and some 43% of social renters are living in poverty.

JRF concludes, child poverty and pensioner poverty are rising again, and figures to come will be worse than those given here because of inflation and the cost of living crisis. Poverty rates for England and Wales are both 22%; for Scotland 21%. Of people living in poverty, 9% used a food bank in the last twelve months.

It is in this context that we see the Conservative government proposing to make it harder for people living in poverty to access benefits, and trying to save cash in this way in order to produce tax cuts before the General Election. The poorest people do not pay tax. It is surely for the Liberal Democrats to raise this dire situation, and the appalling suggestion of the Tories of worsening life for the poorest, in the strongest terms possible. Ed Davey needs to speak out now.

* Katharine Pindar is a long-standing member of the Lib Dems and an activist in the West Cumbrian constituency of Cumberland.

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90 Comments

  • > the benefits system “incredibly damaging to the economy and individuals.”

    Totally agree, a lot of people, normally in work, have zero to do with the benefits system, as they deal entirely with the tax system. Having to deal with both really is an unnecessary activity particularly when the benefits system imposes some daft requirements requiring people to be seen to seek work rather than actually constructively seek work and when they actually get work then strips away benefits as a way that seeks to punish people for actually finding work and being paid more than a subsistence wage.

    There was a really good article recently in the FT (“ Why don’t people leave bad jobs? ”) which another LDV commenter linked to, which also observes how the current benefits system punishes people in another way.

  • Nonconformistradical 2nd Oct '23 - 5:21pm

    “the benefits system imposes some daft requirements requiring people to be seen to seek work rather than actually constructively seek work”

    I wonder how much that mindless bureaucracy is costing we taxpayers……. Money spent by government which might be saved…..

  • Peter Martin 2nd Oct '23 - 5:56pm

    It would help the working poor if the Lib Dems had a view on the desirability of achieving full employment in the economy with a decent and liveable living wage. Once we have that happy state of affairs the number of those genuinely needing a higher level of social benefits will be smaller and much easier to manage politically.

    So a couple of questions:

    1) Are Lib Dems in favour of openly stating that they favour a full employment policy?

    2) What is the Lib Dem policy on the level of the minimum wage?

    I did Google this and all I could find was that Lib Dems were pushing for care workers to be paid £2 p.h. more than the minimum wage but you don’t say what that should be? £10 + £2 = £12 or £11 + £2 = £13 maybe?

    At the last election both Labour and Tory did manage to come up with some figures but I couldn’t find anything recently from the Lib Dems.

    How hard would it be to say you favour a minimum rate of £15 ph, or whatever figure you feel is appropriate, for full time adult workers?

  • Roland,

    When I refer to the benefit system I am referring to the system of financial support people receive. Which I think is the same way Jeremy Hunt is referring to it. I see the sanctions regime as separate. Our party wants to scrap the sanctions regime with its ‘daft requirements requiring people to be seen to seek work rather than actually constructively seek work’, but we want to improve the benefit system so no-one lives in deep poverty.

    I don’t understand why you think that the taper of 55% ‘strips away benefits as a way that seeks to punish people’. (It is better than the original 65% or the 63% which it was until 2022.) I could understand if you were saying that everyone when they start work needs a work allowance of at least £260 a month.

    Someone taking a job of 37 hours a week paying the National Living Wage would receive £339.52 a week from their employer and would loss £186.74 of their benefit if they were not affected by the Benefit Cap. (The Universal Credit rate for a single person over 25 is £89.09 a week and £133.57 for a couple.)

  • Thank you for this article. In the last 2 elections the Lib Dems had the most redistributive policies according to the IFS, more than Labour. We proposed abolishing the two child limit even when Labour under Corbyn didn’t in 2017. This should make people proud to support the party. I hope we will continue to support the least well off.

  • Steve Trevethan 2nd Oct '23 - 6:35pm

    Thank you for an important article!

    Might any country where over some 25% of children exist in poverty be badly governed unless the aims of ruling politicians, and those with aspirations to political power, include the desire to maintain and gain wealthy donors?

  • Sandy Smith 2nd Oct '23 - 7:02pm

    We will only succeed in ending relative poverty if we are willing to drastically narrow income inequality. Socialist parties around the world have balked at taking the radical steps necessary to achieve this end – are Liberal Democrats really willing to take those measures?

  • Katharine Pindar 2nd Oct '23 - 8:34pm

    I heard most of an amazingly boastful speech by the Chancellor Jeremy Hunt, thanks to the BBC in the early afternoon, and was stunned that he included two words in his final sentences of praise to his party – that their achievements will include “less poverty”. These people have to be brought to account. The number of people in poverty in our country today, at more than 14 million, is no fewer than the number noted with perturbation by the UN Rapporteur for Extreme Poverty, Philip Alston, on his fact-finding visit here in November 2018. The Tories evidently remain content with that sad fact.

    We, by contrast, can and should claim to be the British party determined to fight poverty, as our Preamble to the Constitution demands. Thank you for your support, Marco and Steve. But, Peter Martin, I am not aware of any such commitment by your current Labour party, is there one that I have missed? Full employment and a good national living wage are desirable ends, but a determination once more to reduce the poverty in which so many people in our country live helplessly year after year is one to which your party should rise, and which we must urgently commend to them.

  • Peter Martin 2nd Oct '23 - 10:41pm

    @ Katharine,

    Actually I don’t have a Labour party at present. No-one does. I’m politically homeless in that sense.

    The Labour movement still exists though and I’m just wondering why Lib Dems wish to stay aloof from what we’re trying to achieve. This is fair wages, jobs for all and decent working conditions. You don’t have anything to say about that.

  • I think @Katherine you’re quite right that poverty is a terrible problem and it would be great for the LibDems to do more about it. But the fixation on trying to solve poverty by having the Government handing out more money to people is flawed.

    Living standards are ultimately capped by the country’s output. We have so many people in poverty primarily because UK does not have the infrastructure (particularly, not enough housing) and is not producing enough to allow everyone a decent standard of living. If you hand out money to people without fixing that underlying problem, then all you’re likely to achieve is high inflation cancelling out the money you’ve given, and leaving people on average no better off (albeit with some redistribution of wealth).

    The LibDems are on the right track with their housing commitments – building enough houses will make a huge difference to poverty levels. But raising living standards is only possible if we raise output – and that means – amongst other things – tackling why so many people of working age are not working. Jeremy Hunt may have been crass in the words he used, but he is correct to call that out.

  • Katharine Pindar 3rd Oct '23 - 1:18am

    @ Simon R. Thanks, Simon, but you seem to write as if we are all in this together, the people of Britain gamely trying to share out inadequate resources evenly. This is one of the most unequal societies in the developed world, and Liberal Democrats want a fairer division, taxation of capital as well as income, land and council taxation reform and much else. Yes, there must be growth, and we have an industrial strategy to contribute, but wealth and resources need fairer sharing. Sandy, we are capitalists not socialists, but we want the sort of capitalism that cares for all stakeholders, not just shareholders.

  • Peter Martin 3rd Oct '23 - 7:24am

    @ Katharine,

    “This is one of the most unequal societies in the developed world, and Liberal Democrats want a fairer division, taxation of capital as well as income, land and council taxation reform and much else. ”

    You say you aren’t socialist but it sounds very socialist to me! 🙂

    Certainly it’s much better than anything the Labour Party are saying at present.

  • Peter Martin 3rd Oct '23 - 7:32am

    @ Simon R

    “Living standards are ultimately capped by the country’s output.”

    True

    ” We have so many people in poverty primarily because UK does not have the infrastructure (particularly, not enough housing) and is not producing enough to allow everyone a decent standard of living”

    Not true. It’s how its shared out that matters too. GDP per capita per annum in the UK is £33k.

    I don’t know about anyone else but I’d be happy enough with that!

  • Steve Trevethan 3rd Oct '23 - 8:11am

    It seems to me that caring Katherine is an egalitarian, as are many, but not enough, of us.

    Egalitarian: believing that all people are equally important and should hove the same rights and opportunities in life
    (Cambridge Dictionary)

    P. S. I hope that this is O. K with Katherine.

  • Peter Davies 3rd Oct '23 - 8:37am

    @Simon “Living standards are ultimately capped by the country’s output. We have so many people in poverty primarily because UK does not have the infrastructure (particularly, not enough housing) and is not producing enough to allow everyone a decent standard of living.”
    It’s actually a balance between output and cost of living. Our output (Nominal GDP per capita) is 22nd in the world but GDP per capita at price parity is 28th. The solution though is similar. Investment in things like building and insulating homes or improving transport infrastructure only produce a temporary increase in nominal GDP while you are building them but a permanent reduction in the cost of living that feeds into higher GDP at price parity.

    That said, it’s not an either or. Infrastructure investment and redistribution should both be part of our programme.

  • Nonconformistradical 3rd Oct '23 - 9:35am

    @Peter Martin
    “You say you aren’t socialist but it sounds very socialist to me!”

    Socialism implies state ownership of the means of production and distribution. Not aware that Katharine has been saying that.

  • @Peter Martin The problem with claiming that £33K each is enough is that you can’t distribute it equally. Capitalism requires significant income inequality because it depends on people striving to improve their lives, which is impossible if everyone earns the same (And to be clear, that inequality is, within limits, a good thing because being able to strive for something better is a core part of our humanity). Therefore if you want to deal with poverty, mean income has to be far above the poverty threshold (because most people will be well below the mean).

    As for why the UK is more unequal than other capitalist countries (@Katharine): That has a lot to do with the housing shortage. Remember, in a free market, rents/house prices will go to the level that matches supply and demand. That means that, long as there are not enough houses and people are therefore desperate to find a house, housing costs will always rise to completely absorb whatever lower-income people can pay, leaving people in poverty. You can see this in the minimum wage: 10 years ago, it was just over £6 an hour for people 21+. Now it’s about to rise to £11: It’s almost doubled in a decade! Yet notice that no matter how much it rises, it’s never enough. And that’s because it’s not dealing with the problem of lack of infrastructure (houses). That illustrates why it’s impossible to remove poverty by just – in effect – handing out money.

  • Peter Martin 3rd Oct '23 - 10:10am

    @ Nonconformistradical,

    The extent of nationalisation is always a matter of some debate among both socialists and no-socialists. Katharine does support the concept of the NHS which is the nationalisation of the health service. Schools and universities are government owned so we can say much of the education service is nationalised.

    The import issue is the reduction in inequality IMO. The motivation behind having a larger degree of common ownership is to reduce that. However if it can be also be done in other ways, we’re open to these possibilities too.

    The railway tracks and the roads are state owned. I don’t think there’s any great desire to change that.

  • Sandy Smith 3rd Oct '23 - 10:39am

    A lot of confusion in this discussion. Our definition of poverty based on being below 60% of median income. This means that even if we doubled the income of every single person, the rate of poverty would remain exactly the same. More bizarrely, if the income of those above median income was halved, but those below median income just had their income reduced by a quarter, the proportion of those defined as living in poverty would fall. Perhaps we need to change how we define poverty to capture real poverty rather than merely relative poverty.

  • Katharine Pindar 3rd Oct '23 - 10:56am

    Thanks to all for developing an interesting debate here. I think we do have the means to end deep poverty and raise living standards in this country, if resources are more fairly shared. (Peter, glad I am now finding approval from you! Of course Liberal Democrats do also care about the aims of your Labour movement: for instance there was a substantial section of our Fairer Society policy paper about extending workers’ rights. Much which our parties should work on together.)

  • Katharine Pindar 3rd Oct '23 - 1:35pm

    Simon R. You have an interesting take on capitalism, Simon, that it ‘requires significant inequality because it depends on people striving to improve their lives’, a new thought to me so one to reflect on. I thought capitalism is about free markets, but that we Liberal Democrats believe the freedom must be restrained by the state when public interest demands it. And now the public interest does demand that the gross inequality of our country in allowing the continuing poverty of 22% of our citizens to continue at a time when the wealth-takers have been getting richer should be addressed urgently.

    Building enough houses for people to live in, and I should think restricting the right to use housing as an investment rather than to offer people secure accommodation, is part of the answer, Simon. But to increase welfare payments in the build-up to our policy of the introduction of a Guaranteed Basic Income to end deepest poverty within the decade is required also, and we need to settle on the fairer taxation required as finance.

    I think M.E. Larkin is right to draw attention to the profits and pay-outs from them of companies to their shareholders: I understand there is no national insurance payment on dividends, and a lower income tax rate on dividend income, and that our tax system may too heavily penalise employment.
    (Steve, thank you, I am happy to be called an egalitarian!)

  • Steve Trevethan 3rd Oct '23 - 1:52pm

    “Equity, dignity, happiness, sustainability – these are all fundamental to our lives but absent in the G. D. P.”

    (Helen Clark)

  • Katharine rightly highlights the plight of the worst off. Something must indeed be done but if it stops there, I fear it will prove to be merely rearranging the deck chairs. LibDems need a larger vision for remaking the economy that will deliver opportunity and decent living standards for all.

    The challenge is to come up with a way for the country (all of it, not just a fortunate few) to earn a living in a post-empire context. But it’s hard being an ex-empire. Inherited assumptions and myths abound and get in the way of original thought. Moreover, there is enough residual wealth that the leaders don’t themselves experience any hardship and so see no need to rethink their worldview. For now, the show is kept going by running up (privatised) debt, principally mortgages and student loans, but this is wildly inequitable and unsustainable.

    The elite do, however, find that to maintain their position they must (a) take a little more of the cake every year and (b) support the new great power so their weakness isn’t exposed. This can work reasonably well for a few for a time but ultimately, it’s hard being an ex-empire.

    So, there’s a choice; either Britain carries on as now and becomes a banana republic-type country or we undergo an economic and cultural renaissance based on a realistic appraisal of what a mid-sized country can do. Do LibDems have the structures to do that?

  • Katharine Pindar 3rd Oct ’23 – 1:35pm:
    I understand there is no national insurance payment on dividends, and a lower income tax rate on dividend income,…

    Unlike wages and salaries, dividends are not a tax deductible business expense so they are taxed more highly than earned income as they are subject to both corporation tax and dividend tax.

  • Katharine Pindar 3rd Oct '23 - 10:01pm

    Hello, Jeff, I was trying to quote an IFS report, ‘British Tax system in need of reform’, which was referenced on another thread. The point being made there was that the tax system heavily penalises employment, with additional national insurance payments on earnings from employment, ‘whereas other forms of income like dividends or rent incur no liability. There is a lower income tax rate on dividend income and and no national insurance contributions at all on dividends.’ I have no personal knowledge on this and will bow to those who do. But Gordon’s comment reinforces the sense that ‘residual wealth’ and the willingness of the privileged to take a bigger share of the cake, compared with the struggle of the majority to cope with debts and the rise in basic costs, should fuel a determination among progressives not only to provide for the poorest but actually to combine to tackle inequality in our society.

  • Peter Davies 3rd Oct '23 - 10:18pm

    If you combine Corporation tax and dividend tax, Basic rate taxpayers getting income from a small business pay 26% compared to 33.25% combined NI and income tax. Top rate taxpayers getting income from a big business pay 54.5% compared to 47% on salary income. That’s why the rich seldom get their main income from dividends from UK registered companies.

  • @ Katherine, Peter

    To give credit where it is due Labour’s proposals on employment rights are quite good and reverse some measures that really should have been vetoed in coalition.

  • Peter Martin,

    I think our policy about minimum wages is to leave it to the Low Pay Commission while wanting to increase the apprentice and under 18 rates, but I don’t know where we want them aligned to. In the past I tried to get the party to say we wanted the National Living Wage at two-thirds of median wages. (Is the National Living Wage more than 70% of median wages?) Also I tried to get the party to consider having higher minimum wage rates for London, but I was not successful. If we increase working-age benefits to 50% of median income it would make sense for the minimum wages to increase at the same time.

    I have in the past suggested that the party should aim for full employment but the response I got was that there is no agreement on what level of unemployment is full employment.

    There are other definitions of poverty such as the one used by the Social Metrics Commission, but relative poverty is a better way to measure it than absolute poverty which is based on the relative poverty rate of 2010/11.

    Simon R,

    The £20 uplift of Universal Credit did not increase inflation. Therefore there is no case for saying that increasing the benefits bill by £7 billion a year is inflationary.

    M E Larkin,

    Please see my comment https://www.libdemvoice.org/dropping-the-1p-tax-rise-has-political-costs-too-73990.html

  • Jeff and Katharine,

    I think Katharine is referring to this report – https://ifs.org.uk/articles/british-tax-system-need-reform, please see figure 2. It shows that the amount paid in corporation tax and dividend tax is less than that paid by an employee paying income tax and national insurance.

    Peter Davies,

    As 22nd in the world for GDP per capita, our poverty is not about the size of our economy, but about how it is distributed. While housing costs are very high this is not the sole cause of people receiving benefits living in poverty. Even if a person has no mortgage or rent to pay and they receive an out of work benefit they will be living in poverty. Increasing the amounts of these benefits will help removed people out of poverty. As would scrapping the Benefit Cap and linking the Local Housing Allowance to the 50th percentile of local rents. As would building 150,000 social homes a year.

    “Outside of any tax-sheltered investments and the dividend allowance, the dividend tax rates are: 8.75% for basic rate taxpayers. 33.75% for higher rate taxpayers. 39.35% for additional rate taxpayers.” (https://www.charles-stanley.co.uk/insights/commentary/how-much-tax-on-dividend-income ) Income tax rates are 20%, 40% and 45% with National Insurance on top of 12% or 2%.

  • Steve Trevethan 4th Oct '23 - 8:32am

    Might pay distribution be a poverty factor?

    Across employees as a whole, the pay for the top 10% of earners rose by 11.1% in the year to March, compared with a median of 5.5% and just 0.9% for the bottom 10% of earners, according to the Office for National Statistics

  • Steve Trevethan 4th Oct '23 - 9:54am

    C. E. O pay ratio to a median worker was up from 108 to 118 in 2021 and from 79 in 2020. (Reuters)

    Might this be an example of conspicuous acquisition which harms society by reducing prosocial, macro-efficient, reasonable equity?

  • Katharine Pindar 4th Oct '23 - 10:25am

    Good point, Steve. So the low-paid jobs remain low-paid, and a higher national living wage is needed. As Michael suggested, for it to be set at two-thirds of the median wage would seem desirable. Meantime it continues to be the case that about 54% of families living in poverty have at least one member of the family at work. Work alone in low-paid jobs cannot raise them from poverty. And neither can work earnings plus the present rates of Universal Credit raise them from poverty. Our policy to increase Universal Credit and the legacy benefits by £20 a week should be the starting point to achieve that, with further raises by the rate of inflation to follow. We need to demand of the Labour party that they also commit to fighting poverty again.

  • The high pay centre publishes research and recommendations on the causes and consequences of economic inequality, with a particular interest in top pay. The High Pay Centre is calling for reforms to regulations affecting the corporate pay-setting process including:
    – Requirements for companies to include a minimum of two elected workforce representatives on the remuneration committees that set pay
    – Guaranteed trade union access to workplaces to tell workers about the benefits of union membership and collective bargaining
    – Requirements for companies to provide more detailed disclosure of pay for top earners beyond the executives, and low earners including indirectly employed workers, enabling more informed pay negotiations at individual companies and a clearer debate about pay inequality more generally.
    – New bodies should be established for unions and employers to negotiate across sectors, beginning with hospitality and social care
    – Phasing out long-term incentive payments and replacing them with mechanisms like profit shares, common to all staff ensuring that everyone who contributes towards a company’s success benefits from it.

  • Peter Watson 4th Oct '23 - 1:05pm

    “Ed Davey needs to speak out now.”
    “We need to demand of the Labour party that they also commit to fighting poverty again.”

    In case what I go on to write gives the wrong impression, I should first say that this is an excellent article, and as ever your passion and compassion shine through.

    But I think that the challenge here is that neither Labour nor the Lib Dems (especially the Lib Dems!) appear to be chasing the votes of the worst-off in our country. Perhaps the Lib Dem strategists ignore them while Labour takes them for granted. It is not obvious that the target voters for either opposition party share your sympathies, let alone prioritise them, and the parties’ message to voters seems to be “aren’t the Tories horrible”, backed up by pandering to self-interest.

    However, those in poverty can vote. Will the Lib Dems, should the Lib Dems, prioritise a poverty-busting approach, talk loudly about it and appeal to those voters, or will the party keep quiet about it for fear of frightening away affluent middle-class voters and letting the Tories scrape back in?

  • The Low Pay Commission (LPC) is the independent body which advises the Government on the levels of the National Minimum Wage (NMW), including the National Living Wage (NLW). In 2019, the government set a target for the National Living Wage to reach two-thirds of median earnings by 2024 for workers aged 21 and over.
    The current level of 10.42 per hour was estimated to be 63.9% of wages in October 2023. To stay on course to reach 2/3rds of median wage for 2024 the commission estimated the National Living Wage will need to rise to between £10.90 and £11.43 in 2024 to meet its target. With recent wage inflation of 7%-8% the required rate is likely to be at or exceed the top end of the 2024 estimate .

  • The big issue had a good article last month UK poverty: the facts, effects and solutions in a cost of living crisis
    “Reforming the welfare system is key to cutting poverty rates in the UK. Benefits are not enough to cover the cost of living”.
    “It is time to build a system that is needs-tested – where the support people get is linked to the actual costs of essentials to meet basic needs rather than the baseless system people have to suffer now.”
    “Guaranteeing people can afford essential costs shouldn’t be in question. We need a social security system that’s fit for purpose and ensures people can live and thrive whether they can or can’t work.”
    The five-week wait for a first universal credit payment has been shown to push people deeper into debt, driving food bank use and rent arrears.
    The two-child limit, which restricts the amount a family can receive in benefits to the first two children in a family should be scrapped too, if struggling families are to have enough money to live on. That’s along with the benefit cap, limiting the total amount people can receive regardless of what their full entitlement is.
    Increasing wages across the board – as well as strengthening the welfare system and reforming the rental market – is key to cutting poverty. Experts agree that the cost of living crisis will not be fully over until wages catch up with inflation.”
    So three key areas of focus to address deep poverty – benefits, rents and wages.

  • Steve Trevethan 4th Oct '23 - 1:52pm

    Might welcome “poverty busting” policies have a wider and deeper appeal if our party were to make clear the connections between poverty and knife crime?

    Professor Fiona Brookman’s research found that “social factors such as poverty and inequality are the main underpinning drivers of knife crime”. (University of South Wales/Privysgol De Cymru)

  • Born in 1938 I’m now getting pretty stupid and forgetful. I find it astonishing that there has been no mention of some obvious alternatives to the narrowness above? . We libdems seem to be dedicated to Learning and Erudition, to the neglect of imagination and width. Is there a tacit conspiracy to swerve any danger of that tedious old notion, ‘UBI’ , because we’ve all decided to ditch it?

    And if that is the case, is it for moralistic or selfish reasons? Have we all read and understood the work of Professor Guy Standing’s examination of UBI for the Labour party about four years ago. The Guardian for some reason poopooed it, although its own special estimate of his findings did not.

    About UBI there is too much dishonesty about UBI, and most of it, I suppose is not stupid –we are Lib Dems, hang it! — but we do seem very reluctant to look at it seriously.

    And that, at a time when Proportional Representation seems to be approaching, and ALL will be changing — and, surely, for the best?

  • Katharine Pindar 4th Oct '23 - 5:34pm

    Joe, thank you for those usefully informative comments. It sounds as if it will be a good idea for our party to support the recommendations of the High Pay Centre for reform of the regulations on corporate pay setting. Meantime, I was interested to read in The Guardian that Mark Thurston, HS2’s chief executive who has just left, was paid £676000 in 2022-23, including a £39.000 bonus. Since the company was officially in the public sector, his salary was presumably within the Government’s control. He was, wrote the paper’s reporter Gwyn Topham (on September 27) ‘by some distance top of the government’s “high earners” list in recent years. One wonders how he earned the bonus.
    Compare and contrast any family with a worker earning two-thirds of median wage (thank you for the figures, Joe). Surely he or she would stay out of poverty if the wage was topped up by the current Universal Credit? There are too many hazards to make that likely, it seems to me. What if s/he could only work part-time because of looking after a disabled or elderly person in the home? What if s/he was on zero hours contracts with no certainty of daily employment? What if the family had three children so was denied credit for the third? What if there were several people in the house with only one able to work? There are just too many obstacles which too many people have continually to surmount to get a decent living.

  • Katharine Pindar 4th Oct '23 - 6:01pm

    @ Peter Watson. You make a vital point here, thank you, Peter, which I am entirely in sympathy with. If our party were actually to refuse to campaign against poverty because our target seats, Tory-held at present, contain many well-heeled Tory voters who might conceivably not see poverty reduction as a priority for the next government, it would be a disgrace. The Preamble to our Constitution says that no-one shall be constrained by poverty. (The poor cannot be free, a point freedom-loving Conservatives should see.)

    But there are actually a few points that can be made to prove that campaigning against poverty could be an electoral advantage. The first is that the party continues to average no more than 12% in the polls. Nationally, we need to have an image that is different from either Tories or Labour, and an image that can be seen to be based on a deep principle with which most decent people will sympathise. People in Britain are generally thought to be decent and tolerant. We have nothing therefore to lose in the long run by declaring our beliefs, and the policies we have adopted and will ask to be acted on after the next election. We are proud Liberal Democrats, and the country needs us!

  • It seems we are making the NHS our standout area of policy (see Paul Hindley’s article https://www.libdemvoice.org/lets-embrace-being-the-party-of-the-nhs-73999.html). If we set out how we would fund our policies they could be our unique selling-point, but the Labour Party have traditionally positioned themselves as the party for the NHS and we may find that we can’t compete with that tradition.

    If we instead said we are the party who would end deep poverty in the UK within the decade this would indeed be unique. The Tories are never going to do that and the Labour Party when they were last in government made conditions worse for those living just on benefits. According to the IFS working-age adults without children fell behind the rest of the population.

  • Katharine Pindar 5th Oct '23 - 10:27am

    @ Roger Lake. Thank you for continuing to contribute in your eighties! You raise UBI. The party moved on from our plan of promoting UBI in the Spring Conference at York, deciding we prefer the idea of Guaranteed Basic Income, instead of Universal Basic Income. The difference is that GBI would be made available to people of working age who have no means of subsistence at all, not to everyone. It is planned that a Commission would be established to determine the amount needed, which people could apply for. The aim would be to provide annual increases in Universal Credit (first restoring the Conservatives’ £20 a week cut ) so as to end deep poverty, that is earning less than 50% of median income, within ten years. I hope we will promote this plan to the next government, so as to make a start on actually reducing poverty.

  • The importance of rents should not be underestimated. 1 in 200 people in the UK were reported to be homeless in 2019 according to Shelter ‘I have a job but I’m homeless’ – the working poor who can’t afford to rent
    A good number of homeless are actually in paid employment. This is most acute in London and the SE with the NW another hotspot. Many, particularly singles, will not be eligible for benefits and those that can qualify for housing benefit will find it almost impossible to secure accommodation at the rates of housing benefit available.
    The housing crisis is here and now and getting worse by the day UK’s ‘most popular’ home for £1.2k month gets more than 160 viewings in a WEEK with massive queues

  • Peter Martin 5th Oct '23 - 2:43pm

    @ Katharine,

    Mark Pack wrote on his blog, a few years ago, that “Less than one in ten say they know what Universal Basic Income is”. Not all of those who said they knew would have actually known. I suspect many will think it is something to do with a minimum wage.

    I realised recently that I didn’t know what a Guaranteed Basic Income was. I think it was Joe who said it was just the same as Universal Credit. So, if anyone asks what it is you’ll just tell them it’s another word for UC?

    Many will think ‘so what?’. It’s not going to win you a lot of votes. On the other hand if you tell everyone you’re in favour of, say, a £15 ph minimum wage and scrapping zero hours contracts they’ll know what you mean straightaway. It doesn’t have to be an either/or issue. You can still keep your GBI. Most people won’t understand what that means, either, but it doesn’t matter if they can see you’re on their side on the wages question. They’ll be happy enough to accept that you have other detailed measures to address the poverty question.

  • Katharine Pindar 5th Oct '23 - 2:50pm

    Joe, thank you for drawing our attention to the housing crisis again, especially for renters and the homeless. As the article states, some 43% of social renters are living in poverty, as are 35% of private renters, according to the latest figures. And as you say, “a good number of homeless are actually in paid employment”, which is another indication of the government’s callous futility in continuing to suggest poverty can be alleviated by more people getting jobs.
    I had a look at what we decided about renters in passing the housing motion, F31, at the Bournemouth Conference last month. The motion reads, from line 85 (8), ‘Ensuring a fair deal for renters by a) introducing a national register and minimum standards for landlords. b) Extending the default tenancy to 3 years. c) Introducing rent smoothing for the first 3 years of a tenancy. d) Abolishing all eviction except where a tenant has been proven to be breaking the terms of the rental agreement.’ It goes on from line 94 (9),
    ‘Managing the impact of second homes and holiday lets by: a) Giving local authorities new powers to control second homes and holiday lets including new planning classes. b) Requiring second homeowners, holiday lets and investment property to pay their fair share of tax.’ So that is something of a start to helping people keep affordable rented homes when they can find them.

  • @ Katharine Pindar: Thank you for your encouragement: it is most unusual! And I believe one reason for this is that most of the contributors to LDV genuinely contribute so much good knowledge and insight to the argument “where shall we go from here?”, whereas MY hope is to start at the destination, not to elaborate the next step. My attempts are to find an answer to a more fanciful — though equally seriously intended — question: “Where would we like to get to?”.

    I would like to bring us to an answer which I believe few would oppose, on reflection. It would apply to every one of our compatriots, and thus minimise opposition once recognised. It is simple, and universal, and basic, and fair. And unlike (nearly?) all others suggestions, it would be very cheap to manage.

    It is, of course,’UBI’. I would rename it as the National Income Dividend. Everybody would get it, and everybody would pay Income Tax on it. Much money would be saved by the abolition of many dismal jobs, since no-one would need to persuade sceptical scrutineers, one at a time, that each new claim to it may be a fraudulent one: it would simply be minor detail in each person’s Income Tax Return.

    I can see that Conservatives would hate it, but it is not primarily them whom I hope to please, but everybody. What’s not to like?

  • Chris Moore 5th Oct '23 - 4:33pm

    Roger, another way of looking at UBI is that it’s a negative income tax: i.e. the state pays EVRYONE the same rate.

    And therein lies UBI’s defining flaw: everyone gets it and and at the same rate.

    I’m not in favour of flat taxes. I’m in favour of redistribution and progressive taxation.

    I wouldn’t be in favour of a flat 20% rate for everybody and I’m not in favour of a flat payment to everybody.

    If you want to improve the position of the poorer off, focus state transfers on the people who most need it.

  • Peter Davies 5th Oct '23 - 5:03pm

    UBI and flat taxes are flat in completely different senses. Progressive sounds like something you couldn’t object to but if used correctly about taxes it means that there is more redistribution between rich people and well off people than there is between comfortably off people and poor people. There are arguments for and against that but progressive taxes are not a no-brainer for progressive economists.

    People often use progressive to mean redistributive but a 45% flat tax with a high rate of UBI would be far more redistributive than a progressive one where the 45% tax only started at 150k.

  • Peter Martin 5th Oct '23 - 5:23pm

    @ Roger Lake,

    “What’s not to like?”

    If you some numbers into the picture, I’m pretty sure that you’ll get plenty of answers. The problem is that a UBI won’t be viable and large enough to remove everyone from poverty at the same time.

    I use the word ‘viable’ rather ‘affordable’ deliberately. It’s not just about the arithmetic of paying everyone more unconditionally and universally, then clawing back the cost via the tax system. It’s also about the effect on the jobs market when you do that. This isn’t usually considered. We do need people to do nearly all the minimum wage jobs and paying everyone to just not do them isn’t the answer.

    Paying workers more to do them is a much better option even if it does mean the rest of us have to also pay more in one way or another too.

  • Sandy Smith 5th Oct '23 - 5:33pm

    UBI alone will only remove someone from poverty if set at over 60% of median income. This is true, by the definition of poverty, whether median income is £30k or £300k.

  • @Chris Moore.

    I ought to have been clearer, Chris. Consider two examples from opposite ends of Income. Compare the Prime Minister at top of the income spectrum, Father Christmas at the other, long resident in England, but enjoying no income from any source. Both will be entitled to the National Income Dividend; and each will get the same NID — before Tax, that is.

    FC would pay Income tax on his NID, at the minimum rate, having no other income. The PM will pay Income Tax at the highest rate applicable to his total taxable income including NID So he will get a much smaller monthly payment in the shape of NID, having forked out to the IR.

    So each pays Income Tax, one much more than the other. But why on earth does Father Christmas pay ANY Income Tax? The answer is important. This is because that puts FC and PM on the same basic footing: each pays I T at the rate appropriate to his Taxable Income. Each is a Taxpayer contributing, to the Inland Revenue , a payment of Income Tax appropriate to his total Taxable Income.

    So does every adult in the land. Every man and every woman pays IT according to the prevailing rates, and can look everyone else straight in the eye, as being not only a beneficiary but also a contributor-to the Income Tax regime.

    (And clearly there wiil be savings for the Inland Revenue, with so little to investigate!)

    Thanks for your valuable query, Chris. I do hope it makes sense.

  • Peter Davies 5th Oct '23 - 6:35pm

    “The difference is that GBI would be made available to people of working age who have no means of subsistence at all, not to everyone.”
    That is highly misleading. GBI like the near identical Universal Credit is a tapered means tested benefit. It will fail to support some people who have no means of subsistance. Every previous means tested benefit has. It will also pay out some money to people who do have an income so that they will have a higher income than those who earn nothing. Fair enough. If you set the base level high enough to eliminate deep poverty there will be a lot more earners entitled to it than there are unemployed. They will include some who are also paying higher rate tax.

  • The idea of progressive income taxes is that the % of tax paid on income rises in proportion to income and that those on low incomes pay no tax. The closest you get to that linear relationship is with a high level of personal allowance and relatively flat level of tax and NI above that level. At present we have rates of tax and NI of 32%, 42% and 47% above the income tax allowance and NI threshold.
    The IFS writes “Removing zero and reduced [VAT] rates would, on its own, be regressive as poorer households spend a larger share of their budgets on these items. But better-off households spend more, and therefore save more in VAT, in absolute (cash) terms. This means that the additional revenue raised from removing a zero rate would be enough to more than compensate poorer households on average. For example, if the government put VAT on children’s clothes, it could use part of the revenue to increase child benefit so that the poorer half of households were no worse off on average, and still have revenue left over from the richer half of households.”British tax system is in need of reform
    The benefit system with its earnings taper has always created poverty traps. For every £1 you earn over your work allowance your Universal Credit will be reduced by 55p. Work allowances are only available to households with children and those with limited capacity to work. Limited capacity to work in practice means severely disabled so a work allowance does little to help.

  • Benefits or minimum wages will never be enough to keep pace with rents as long as the rental housing supply (most importantly council or subsidised housing) is insufficient to meet demand. Any increase in benefits or wages (or even charitable support) is soon absorbed by higher rents as Churchill observed in his days as a Liberal minister Winston Churchill said it all better then we can
    “Some years ago in London there was a toll bar on a bridge across the Thames, and all the working people who lived on the south side of the river had to pay a daily toll of one penny for going and returning from their work. The spectacle of these poor people thus mulcted of so large a proportion of their earnings offended the public con-science, and agitation was set on foot, municipal authorities were roused, and at the cost of the taxpayers, the bridge was freed and the toll removed. All those people who used the bridge were saved sixpence a week, but within a very short time rents on the south side of the river were found to have risen about sixpence a week, or the amount of the toll which had been remitted!”

  • Katharine Pindar 5th Oct '23 - 7:18pm

    Peter Davies. No, you are mistaken, Peter, but in being so you have helped to clarify the policy of Guaranteed Basic Income. When we in the party working group for a Fairer Society drew up policy paper 150, entitled Towards a Fairer Society, this is what we wrote on page 26, section 3.10, headline ‘Proposed Option 2: Guaranteed Basic Income’.
    3.10.1. ‘Liberal Democrats are committed to introducing a Guaranteed Basic Income (GBI) by steadily increasing welfare payments and removing the work requirement. This has the potential to end deep poverty in Britain within a decade.
    3.10.2. The GBI will require immediate changes to Universal Credit and then a managed increase in the payment level by a independent commission, similar to the Low Pay Commission, over ten years.
    3,10.4. The GBI amount will depend on how costs for essential requirements change over the coming years and what target level is deemed appropriate.
    3.10.5. If GBI was set at 50% of median earnings this would require further weekly increases, on top of the initial £20 uplift, of approximately £50 on the allowance for a household with one adult.’
    This was passed. You can see that the policy implemented will differ from Universal Credit in not being subject to reductions such as tapering. People without means will be provided with this basic amount, which will lift them from deep poverty within ten years.

  • Peter Davies 5th Oct '23 - 8:22pm

    Nothing in that motion says we would remove the taper. If you did remove the taper, you would of course have a UBI.

  • Katharine Pindar 5th Oct '23 - 8:51pm

    Not so, Peter, because GBI cannot be universal. UBI would give everyone of working age a small amount, and it will never happen. GBI will be given only to those of working age who have no other means of subsistence. As a leaflet distributed outside the Conference in York put it, Guaranteed Basic Income will ‘Immediately boost the incomes of everyone on benefits’, will ‘Target support at the poorest to end deep poverty within a decade’ and ‘Scrap the Tories’ cruel benefit sanctions that trap people in poverty.’ It is not the same as UBI, NOR as Universal Credit. It should be fought for.

  • Peter,

    there was an explainer document issued with the policy paper Universal Basic Income vs Guaranteed Basic Income: GBI provides a ‘top up’ to Universal credit when income is low. Both of the proposed policies (UBI or GBI) retain existing welfare benefits.
    “The overall level will be set by the commission, but to give some indication, weekly increases in universal credit of £70 for a household containing one adult and £140 for a household containing two adults would have the effect of ensuring all households have income at least 50% of median income, and would cost something similar to the proposed UBI that replaced tax and NI allowances ( £35-40bn a year)”.

  • @Michael “The £20 uplift of Universal Credit did not increase inflation. ” The uplift was always understood to be temporary, and most of the time it was in force, we were in some kind of Covid lockdown, heavily restricting people’s ability to move house, and therefore largely locking down the rental market. You can’t reasonably extrapolate from that to what would happen in terms of inflation if there was a permanent uplift at a time when people are able to move and housing costs are therefore free to adjust to what people can afford.

  • Peter Davies 5th Oct '23 - 9:40pm

    ‘A leaflet distributed outside the conference’ is not the policy.

    ‘Immediately boost the incomes of everyone on benefits’ is not the same as only paying it to people with no other means of support.

    What is being suggested is not getting rid of the taper, it’s increasing the taper to 100%. It’s effectively a 100% tax rate on the poorest. That’s not in the motion and it’s certainly not what anyone on the rostrum was advocating.

  • Katharine Pindar 5th Oct '23 - 10:44pm

    No, Peter, in quoting the leaflet I wasn’t suggesting it defined policy. But it is the case that since in building up to GBI rates of Universal Credit would be increased, those on UC would benefit (first and foremost by the restoration of the £20, which, though not intended by the Chancellor to be permanent, was for those losing it a really severe deprivation). However, you make an interesting point about tapering. It raises the question, not discussed in our working group, about what will happen if the person in receipt of GBI one year in the succeeding year gains some other income, perhaps from new employment. Some allowance will probably have to be made for some change of circumstance, but I suppose if it continued s/he would revert to being a UC claimant with its usual tapering and restrictions. It’s helpful to think of the policy in practice.

  • Peter Martin,

    The party has not passed policy setting out what amount the National Living Wage should be increased to. Currently median earnings for ‘regular pay’ is £16.676 for a 37 hour week. The government wants to increase National Living Wage to two-thirds of this by 2024. £11.12 is two-thirds of £16.676. I would not support increasing National Living Wage to a fixed figure. I would support increasing it to three-quarters of median earnings, which might be in the region of £14.65 by 2028.

    In 2019 the Labour Party policy was, ‘Banning zero-hour contracts and strengthening the law so that those who work regular hours for more than 12 weeks will have a right to a regular contract, reflecting those hours’. Via Katharine I suggested to the Fairer Society Working Group that after 13 weeks someone on a zero-hour contract could make their average hours into a fixed contract. This was taken up by the Working Group – ‘Creating a right to switch to a contract which reflects a worker’s normal hours. This is not about a worker requesting a change to the amount of work they do, but rather proper recognition of their normal hours’ and as you pointed out earlier those on zero-hour contracts should be paid at least 20% more than the minimum wage rates (page 36 of Policy Paper 150 Towards a Fairer Society).

  • Roger Lake,

    I note you have said you have read Guy Standing’s examination of UBI for the Labour Party. I have also read it, but I can’t remember what costs he sets out, or even if he does. A UBI is not cheap. Please look at page 13 of our Consultation Paper 146 UBI – https://assets.nationbuilder.com/libdems/pages/61596/attachments/original/1628504431/embedpdf_CP146_book.pdf?1628504431
    It is stated that a UBI of £71 has a gross cost of £152.8 billion. The draft policy would have included this being subject to the taper, which would mean that someone on Universal Credit would receive only £31.95.

    If you read our Policy Paper 150 Towards a Fairer Society (https://www.libdems.org.uk/conference/papers/spring-2023/towards-a-fairer-society) it is stated as Katharine points out that under GBI they would receive £50 a week instead.

    Joe Bourke,

    Indeed we need to increase the supply of housing for rent. This is why it was important that at Bournemouth we reaffirmed our policy to have a housing target of 380,000 homes and 150,000 social homes a year.

    Thank you for posting to the explainer document. I had not seen it before. It seems based on what is in the policy paper, but has a few extra details. (Roger I suggest you read it.)

  • Simon R,

    About 6 million people received the Universal Credit £20 a week uplift for a year, costing about £6 billion. People on Universal Credit are unlikely to move house. Universal Credit is not meant to be used to pay a person’s rent. The government also increased Local Housing Allowance payments and again this was not inflationary. £6 billion is about a quarter of one per cent of our GDP which is about 0.02% per month.

    Peter Davies,

    This is what we passed in York, ‘introducing a Guaranteed Basic Income by increasing Universal Credit to the level required to end deep poverty within the decade and removing sanctions’, (see page 22 of the policy paper). Also see 3.10.2 posted by Katharine Pindar. Universal Credit will be the basis for our Guaranteed Basic Income and of course it would include a taper. We don’t have a policy about changing the taper, but we do have policies which include,
    Introducing emergency grants instead of advance loans;
    Reinstating the work allowance for those without children, and introduce a new second-earner work allowance (see pages 20-21).

    You could be correct that someone earning £50,270 might be entitled to some small amounts of benefits if all of our benefit policies were implemented. I think we should consider having two levels of taper, perhaps one of 63% starting when a household’s net earnings are above £30,000.

  • Peter Davies 6th Oct '23 - 6:33am

    Thanks Michael. That’s what I thought we had passed. As a supporter of UBI, I have no objection to people on people on middle incomes receiving benefits. I do have a problem with that many people being means-tested and facing very high effective tax rates. Households on middling incomes would be facing effective tax rates over 80%. The exact numbers and rates depend on how we raise the money.

    My real concern though is that many people at high levels in the party including the proposers of the option are completely mis-representing it as only going to those most in need. If they do that in an election, they will be torn to shreds.

  • Peter Davies 6th Oct '23 - 6:39am

    I mistyped. That should be 70%

  • Steve Trevethan 6th Oct '23 - 8:28am

    Might it be worth considering a form of “positive taxation” whereby those whose income was below a decent level received a proportionate supplement to facilitate their, and, importantly ,their child/children being properly fed, housed and clothed?

    This would have costs but, it is suggested, would go some relevant way to achieving a whole, healthy generation to take over the country in their turn?

  • Peter Davies 6th Oct '23 - 10:26am

    @Steve. That’s usually refered to as a negative income tax though perhaps defining all current tax as negative would make sense. It’s actually just a different way of describing UBI.

  • Katharine Pindar 6th Oct '23 - 10:53am

    I heard Anwar Sadat on the Today programme this morning claiming that Labour is the party most identified with raising people from poverty. Perhaps he is entitled to claim that in Scotland, where the Labour party has triumphed in the by-election, but is not running the country where 21% of the population lives in poverty. However, while Keir Starmer refuses revision of the two-child restriction on granting extra welfare benefit, and is not noticeably claiming to tackle poverty, it is surely the Liberal Democrats, with our Fairer Society policy (F12) passed in the York Conference, who can show we are the leaders in policy to tackle poverty. I believe we should claim it, but also aim to make it a policy which the next government will implement.

    Peter Davies, the Guaranteed Basic Income will indeed be available for all those without means of subsistence. But unlike in the earlier agreed policy of UBI, tapering it was not discussed in the proposition. Clearly as Universal Credit will continue, and be increased, everyone of some means will continue to be able to receive benefit from that, subject to tapering., and no-one is suggesting that those not in absolute need will not continue to receive help.

  • Steve Trevethan 6th Oct '23 - 1:18pm

    Thanks to Peter Davies!

    Might it be worth considering relating minimum wages to the profits/dividends/senior executive pay and the like of the particular employing organisation?

  • Katharine Pindar 6th Oct '23 - 11:11pm

    Public companies could, I suppose, Steve, have the comparisons made between pay of top executives and those of the workers, and we can decry profits and bonuses paid out by companies seeming to fail the public, like some of the water companies of late. But in private companies, I suppose it’s up to share holders to turn up to annual meetings to protest at any seemingly unequal payouts.
    Meantime, I have to make a correction. I said I had heard Anwar Sadat on the Today programme, this morning, unintentionally it seems naming an Egyptian leader. It has been pointed out to me that if it was the Scottish Labour leader I heard, in a fragment of discussion this morning, his name is Anas Sarwar. I hope I have got that right now! I am sure this has been a happy day for him in any case.

  • Peter Davies,

    I think those paying the basic rates of income tax and national insurance on Universal Credit have deductions of 69.4% and those paying 47% income tax and national insurance would have deductions of 76.15%

    Steve Trevethan,

    For those in work who receive benefits it would make sense for them to receive a negative tax adjustment rather than a separate benefit. However, there is an issue about if is right for one partner to receive all the income including the benefit rather than having the option to split it between them.

  • Steve Trevethan 7th Oct '23 - 8:35am

    Might we, at bottom in these matters, be discussing the equitable and, therefore, efficient proportional distribution of wealth, which has to involve the state as, without such, the unmanaged market always benefits the wealthy?

    Might “private companies” be subject to legislation and the law?

    Might it be reasonably possible to distribute allocated income as seems equitable and efficient, family unit by family unit?

  • Peter Martin 7th Oct '23 - 11:14am

    @ Steve,

    If we consider the usual taxation payment as being in the positive direction then what you’re suggesting is actually a “negative income tax”. A UBI could in principle work this way.

    I seem to remember the Lib Dems spruiking the idea of a NIT some 40 or 50 years ago. What happened to that? Milton Friedman was also keen on the idea of a NIT which might cause us to ask if it is really is such a good idea.

    https://www.adamsmith.org/blog/why-do-neoliberals-support-a-negative-income-tax

  • Katharine Pindar 7th Oct '23 - 4:35pm

    Peter Martin. I want to take up a suggestion mooted by you in this discussion (October 5, 2.43 pm) that perhaps Guaranteed Basic Income could just be considered as another word for Universal Credit. No indeed! Although GBI is to be built up by regular increases in welfare payments, it will be different when achieved, distributing an amount available to every household without means, decided by an independent commission which will determine the appropriate level each year. (A household, by the way, may consist of just one person.) The applicants will just have to show they have no means of having the essentials of a dignified life, and there will be no work requirement, tapering or sanctions.
    Much remains to be settled, as the policy is flexibly rolled out, but I have always assumed myself that this will be a rescue operation, not eventually part of the safety-net of enhanced benefits, but available to the most deprived people who are living here – people no doubt for the moment meantime dependent on charities – such as refugees, victims of modern slavery who are rescued, down-and-outs and the homeless.

  • I have unavoidably missed a day or two, and am now hoping to offer my own [ “op-ed”, is it? ] outlining what I think is the radically different approach to UBI that I tried to slide in here, before the weekend. That figuratively personified two example consumers, labelled Father Christmas (FC) — no other Income — and a Prime Minister (PM) — plenty.

    I shall try to look further ahead than this majestic LDV conference seems to, which will perhaps make things easier: but ‘ahead’ is not far off . Six years?

    Please look out for it! I am probably daft; but I am in earnest.
    RL

  • Katharine Pindar 8th Oct '23 - 8:01pm

    @ Peter Martin. Just a short comment on an unfinished discussion, Peter – your general scepticism about my party’s commitment to the general working population. It really isn’t justified: we too want union membership to be available where employees want it. And at our York Spring Conference we supported, in our Towards a Fairer Society policy paper 150, several new proposals under the heading of Employee Participation and Ownership (section 5.4). These included proposing a new type of employee trust called an Employee Share Trust, where each employee would have an equal say and share in the trust while employed or contracted by the relevant business, and that, outside of a share in ownership, workers’ rights to participate in organisations with over 250 employees should be enshrined in legislation. We would have the UK Corporate Governance Code amended so that companies are required to establish a policy concerning employee participation. We believe emphatically that companies should consider the rights of their workers and not simply the remuneration of their directors and share-holders.

  • Peter Watson 8th Oct '23 - 8:52pm

    @Katharine Pindar “at our York Spring Conference we supported …”
    I do have reservations about this along with the claim that is often made about Lib Dem policy being member-led.
    What is Lib Dem policy for grammar schools and faith schools? Citing conference votes that called on “the government to abandon the selection by ability and social separation of young people, into different schools” and also for an approach which “ensures that selection in admissions on the basis of religion or belief to state-funded schools is phased out over up to six years”, I might assume that Lib Dem policy was opposed to and sought an end to grammar schools and faith schools. However, those votes were at separate conferences in 2016, and after seven years, two general election manifestos, and umpteen by-elections, I’ve seen no evidence that the party even remembers those votes let alone has policies informed by them. 🙁
    I fear that radical policies which are popular with members are simply ignored by conservative party strategists for fear of frightening target voters.

  • Katharine Pindar 8th Oct '23 - 10:37pm

    @ Peter Watson. Well done, Peter, in recalling a policy our party passed in 2016! It’s the case that we pass a great many policies, which remain our policies unless and until we change them, but it’s a rather human possibility that we forget for the time being about one or two which haven’t been relevant to any recent discussion. Do I read you having doubts now about the worker-friendly policies we passed at the York Conference? I think we do quite often have grand designs which, while honestly intended, may because of our being unable to have them fulfilled at present go on the back-burner for the moment. I’m determined to do my best to stop that happening with our anti-poverty measures, which I hope may be taken up by our influence on the next government. But I think our membership is too feisty to allow the leadership, or as you say the party strategists, to ignore policies that we have firmly passed and want delivered, and there is a strong feeling in the party that we are not going to accept any forelock-touching to the Tory voters in our target seats.

  • Katharine Pindar 8th Oct '23 - 10:57pm

    @ Peter Martin. Hi, Peter. Regarding my comment to you at 4.35 pm, I think that I should make it clear that my conception of the fulfilled Guaranteed Basic Income as then being separate from the established Universal Credit and not subject to the limitations of that policy is my own development of the idea, and not yet discussed in the party. It’s been good to have had to think of how it may work in practice, given that the previous policy of UBI was sometimes claimed to be impossible to fulfill, and while Michael’s article is a delightful financially-sound exposition of how deep poverty may be ended in this decade, the continuation of the grand principle of for ever more giving people who have no means of subsistence a sufficient sum is still very much open to discussion on its logistics.

  • Peter Watson 9th Oct '23 - 12:16am

    @Katharine Pindar “Well done, Peter, in recalling a policy our party passed in 2016!”
    I’ve been commenting here about those votes regularly since then!
    I’d hoped the vote on academic selection marked a welcome change from the party’s depressingly conservative and hypocritical approach to grammar schools (i.e. criticising them and opposing expansion while being content to keep existing ones), but apparently not. 🙁
    With faith schools, I’m not the only one to question the party’s motives in ignoring a conference vote: from the Jewish Chronicle during the 2019 General Election, “Pragmatism seems to have prevailed among the Liberal Democrats, who two and a half years ago voted to end religious selection in state schools. A radical move which, just as was the case with the 2017 election, they have again left out of their manifesto. It would hardly have helped Luciana Berger’s bid to capture marginal Finchley and Golders Green for the party had she had to defend the idea of stopping Jewish schools from giving priority to Jewish pupils.” (https://www.thejc.com/family-and-education/all/libdems-play-safe-on-faith-school-entry-1.493736).
    It’s why, given that I still don’t know if party policy reflects those conference votes, I’ve no great confidence about others (e.g. rejoining the EU), and with regards to UBI/GBI and ending poverty, when the party’s tacticians are targeting voters who might be perceived as picking up the bill, radical and compassionate Lib Dems like yourself might still have your work cut out in ensuring it is part of the party’s offering.

  • Katharine Pindar 9th Oct '23 - 12:54am

    @ Peter Watson. Yes, I have noticed you commenting long before this, Peter, and have always appreciated your challenges. I admit I don’t know what happened to the faith vote, and also that our party as with other politicians will try to put our best foot forward (and maybe not admit that the other one is sometimes lame!).

    But we are more democratic than the two big parties, and many members make their voices heard and demand that their views be attended to. And I think there is a real resolution in the party, not to permit focusing on winning ex-Tory voters with any denial of our social-liberal policies. Besides, we do have to cost our policies, and the UBI policy (which I thought myself would never be carried out) WAS carefully costed. Similarly, we can explain where the money is to come from for GBI, so we are pragmatic too. And I think I as an ordinary member and lifelong Liberal hopefully do speak for others. Despite all our faults, I am actually proud of our Liberal Democrat party. I hope you will get the opportunity to vote for us, especially if and when we finally get Proportional Representation in national elections.

  • To Katharine Pindar.

    Thanks again, Katherine, this time for pointing us forward to what I hope and believe will be a life-changer for everyone: Proportional Representation. That couples with what I hope to propose for UBI, in my daunting attempt now — to realise the challenge from a year and a half ago, of attempting a Lib Dem “Big Idea”.

  • My apologies, Katharine, for misspelling your name.
    Roger

  • Katharine Pindar 9th Oct '23 - 3:25pm

    Thanks, Roger, and best wishes with your attempt to write a piece for LDV. But I’m afraid UBI is no longer our party’s ‘big idea’. At the Spring Conference in York we decided to support GBI instead – Guaranteed Basic Income, which will go only to people who need it, and which we reckon can end deep poverty within a few years, by building up and enhancing Universal Credit. See the concurrent article by my friend and colleague Michael Berwick-Gooding. I am hoping we can get Sir Ed to speak on this at some time, and encourage the Labour leader to think of adopting it as well. But we also need to persuade Sir Keir about Proportional Representation. Much work to be done!

  • Roger Lake,

    I do hope you will read everything I have suggested you read before you write your proposed LDV article.

    Ending deep poverty within the decade should be one of our big ideas for the next general election.

    Peter Watson,

    I am not as optimistic as Katharine. While Conference makes policy, it is a small group of eleven people (the manifesto working group) who write the manifesto. This includes three MPs, three members of the House of Lords and three Councillors. The Federal Policy Committee is supposed to give them direction. We need to lobby its members to include the policies we see as missing and are important to be included in the final manifesto.

  • Katharine Pindar 10th Oct '23 - 10:21am

    I entirely agree with Michael, that we will need to lobby members of the Federal Policy Committee, to ensure that important policies we think are missing as yet from the proposed election Manifesto are included. That will also mean spelling out those policies in unambiguous terms, such as describing Guaranteed Basic Income as the proposed vehicle, adopted in the York Conference, to end deep poverty within the decade. I am going to ask the Social Liberal Forum Council, of which I am a member, to join in the lobbying. I think Peter Watson shows us that the many of the public will probably value us more if we put forward our bold policies without ambiguity.

  • Katharine Pindar 11th Oct '23 - 5:44pm

    It has been suggested, in the comments on the excellent concurrent article on ending deep poverty by 2029 by my friend Michael Gooding, that the establishment of a Guaranteed Basic Income agreed by our York Conference could be dropped. However, this would I believe be a mistake, as well as a contradiction of the policy passed then, motion F12. While the Guaranteed Basic Income is certainly intended to be built up by increasing Universal Credit and other welfare benefits, eventually it should surely stand as a strong independent body, with the amount available as a basic income established each year by an independent commission. As Michael has written, an independent commission would be able to work out the appropriate amount needed to give basic subsistence without reference to other welfare payments or changes of policy.

    Much has yet to be agreed on the implementation of GBI, but its intention, to be available to everyone who has no means of subsistence – whether they have suddenly fallen into misfortune, or are perhaps refugees or homeless vagrants – would surely put it in the spirit of our esteemed forebear William Beveridge. You are down and out, not able to access Universal Credit, desperate and dependent on charity to survive? This should be your lifeline.

  • In comments section of my article I agreed with Katharine when I wrote, “an independent Commission would be needed to ensure Labour and Conservative governments kept increasing benefits to keep them at least at the deep poverty level and it could be given the target to set the level of benefit increases to get benefits to the poverty level at some future date”.

    I have not written “that the establishment of a Guaranteed Basic Income agreed by our York Conference could be dropped”.

    I agree with Katharine that a Guaranteed Basic Income, which sets a minimum income every household will have and delivers it for those who don’t have it, will be available to refugees and the homeless, as well as those who are unemployed or who are not well enough to work.

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