Poverty in the UK is deepening.
We knew this, we can see it all around us in the rise of expanded food banks, the active community charities, the special price reductions on basic supermarket foods and the increase of homelessness. But now Joseph Rowntree Foundation in its annual report on poverty levels reveals the grim facts.
More than one in five people in the UK, 22%. 14.4 million, are living in poverty, having less than 60% of the UK average for the type of household they are in after adjusting for housing costs. And 6 million of them were in very deep poverty at the last count, having less than 40% of the UK average – a category that has increased by 1.5m over the past two decades.
The report says:
A couple with two children under 14 living in very deep poverty would need an additional £12,800 a year – more than double their household income – to get out of poverty.
Of the 14.4 million people living in poverty, 8.1 million were working age adults, 4.2 million were children, and 2.1 million were pensioners. Around three in every ten children in the UK live in poverty, and the proportion rose between 20/21 and 21/22, as did overall poverty. The report says that poverty rates across the different groups has returned to around their pre-Pandemic levels.
Of the different groups affected, informal carers were much more likely that those households with no caring responsibilities to be living in poverty: 28% compared with 20%. In 2021/2 nearly one in ten adults, 4.8 million people, were informal carers.
Around two-thirds of working age adults in poverty lived in a household where someone was in work, evidently unable to get out of poverty through employment.
Among the worst affected groups were Pakistani and Bangladeshi households, around half of whom were living in poverty, compared with 19% of households headed by someone of white ethnicity.
After recording these grave findings, the Report says:
We need a coherent plan with creative policies to end poverty in the UK.
To this our party can respond:
Liberal Democrats have such plans – the only party in the UK known to have them.
From the Autumn 2021 Conference when we (vainly) demanded that the £20 a week increase in Universal Credit at the time of Covid be retained permanently, to Autumn 2023 when we reaffirmed in the pre-Manifesto document our commitment to end deep poverty within a decade – following up the detailed F12 Fairer Society policy at York where Guaranteed Basic Income was decided on – we have stated at Conference our party commitment to tackle and reduce poverty.
It is needful. The Foreword of the JRF Report for this year tells us that it has been 20 years since we last saw a sustained fall in poverty in the UK. And even more starkly, the Guardian journalist Frances Ryan wrote in the Spring of last year:
The erosion of social security rates over the past 40 years has broken the link between State support and what it actually costs to live.
Thousands of our fellow citizens have all too much lived experience of that. Now it is surely time for our Leader Ed Davey to tell the country loud and clear:
“To reduce poverty in this country must now be the first aim of the Liberal Democrats, the first of our ‘bold and distinctive’ policies. We demand that government this year takes action, to begin to put right this blight of immense poverty in our country today.”
* Katharine Pindar is a long-standing member of the Cumberland Lib Dems
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75 Comments
Thank you for a most important article!
Let’s hope that anyone at H. Q. reads it.
The short answer is the rebirth of our party into a very well informed, energetically informing, dynamic and assertive political force to be reckoned with.
Much of the long answer is to be found in the book “Late Soviet Britain” by Abby Innes.
It shows how Britain championed and advanced neoliberalism, especially neoliberal economics and in doing so has so seriously damaged our governing institutions and ethics.
Neoliberalism, like Leninism, is a closed-system form of governance which ignores observable reality and so blindly continues to increasingly impoverish its citizens, and their children, as so well presented by Katherine Pindar, and take us further along a track from democratic liberalism.
Steve, thank you for your helpful comment about what our party should be (YES!) and the baleful influence of Neo-Liberal economics. I also want, having read again Frances Ryan’s article, to pick out a conclusion of hers which matches well with our thinking. She wrote, “The welfare state is no longer a safety net for hard times – and there is no intention that it should be so… It is underpinned by the belief that people who receive state support should endure a certain level of hardship… It is the Victorian workhouse mentality repackaged for the 21st century, where ‘help’ must come with a hefty dose of suffering and shame.” Yes, that is surely the attitude of too many of our political leaders, albeit disguised. The suffering and shame is absolutely obvious – spoken of for example as her personal experience by a housewife interviewed on yesterday’s World at One on Radio 4. Our party surely must fight this attitude now.
The Guardian has reported at the bottom of this article on the JRF Poverty report (https://www.theguardian.com/society/2024/jan/23/escaping-poverty-joseph-rowntree-foundation) that the government use a different lower definition of poverty – absolute poverty based on 2010 figures. And that a government spokesperson said, “Children are five times less likely to experience poverty living in a household where all adults work, compared to those in workless households.” This ignores the facts that 44% of children in lone-parent families were in poverty in the latest data – 2021/22 – as were 32% of children in families where the youngest child was aged under 5” and a majority of those living in poverty – “around two-thirds of working-age adults in poverty actually lived in a household where someone was in work”. The government doesn’t care that “People in workless households also face a higher risk of poverty, with more than half of working-age adults (56%) in workless households being in poverty in the latest data”.
If the level of benefits were higher, then fewer workless households and fewer households where someone is in work would be living in poverty. There should be a safety net in the UK where someone living on benefits have enough to live on and not have to miss meals and not put the heating on to save money.
“More than one in five people in the UK, 22%. 14.4 million, are living in poverty, having less than 60% of the UK average for the type of household they are in after adjusting for housing costs. And 6 million of them were in very deep poverty at the last count, having less than 40% of the UK average – a category that has increased by 1.5m over the past two decades.”
It’s actually worse than that. Poverty and deep poverty are defined relative to the median rather than the average.
As a party that supports the aims & ideals of the EU + has a long term ambition to rejoin – an institution that’s wedded to neo liberal economics that’s been so detrimental to working people at the bottom.. Stagnant wages & insecure work being the norm .
“when unelected EU institutions directly representing EU ‘s biggest banks are removing elected governments and imposing mass unemployment, social dumping, & unending austerity everywhere …Bob Crow..
Peter Davies. Thanks, Peter, you are right – I slipped up there, knowing the percentages are of the median not the average, as the Report says. They are appalling figures.
Whatever happened to ‘none shall be enslaved by poverty’, an idea that’s a lot clearer and more sharply defined than standing for ‘fairness’? I suspect framing what we stand for would be a lot easier if we talked about ending poverty rather than wanting fairness. As Katherine correctly identifies, you tackle poverty first by increasing incomes, and that means some form of basic income guarantee.
On the median and the mean, in this case their are two factors for the profile of a population, how skewed it is and how spread out it is, the more inequality there is the more the population is skewed and the larger the difference between the median and the mean, the more spread out the population, the greater the number below 60% of the median.
Although the difference between the median and the mean will be greater where there is more inequality data of this sort will always be skewed because whereas it is very possible for someone to earn £50K above the mean or the median salary, it is not possible to earn £50K below the either of these averages. Incidentally a guaranteed basic income would skew the profile even more. In this case the median would be a better measure. A more difficult but more informative measure would be of the disposable income per person when fixed payments (rent or mortgage, services, council tax etc.) have been deducted.
Adrian, thank you. Ending poverty should indeed be our party’s mission, if we accept our constitutional duty, encompassed by the great concept ‘None shall be enslaved by poverty.’ ‘Fairness’ is indeed too tame a concept, for a party with our history, legitimately aspiring again to have a share of power so that we will be able to put things right in our country.
Comparisons of the measurement of poverty are fair enough, Martin, but we have a basis to work on: basic benefits today are at least £140 a month below the real cost of food, energy and daily essentials, according to research by the JRF, and that is a reality sadly affecting millions of our fellow citizens daily.
@ Adrian,
“…. tackle poverty first by increasing incomes, and that means some form of basic income guarantee.”
Not necessarily.
There are a several other factors which would include:
1) The wages of those in employment on the lower end of the pay scales.
2) The ability of those workers to secure sufficient hours to earn a sufficient income.
3) The rates of taxation applied to incomes. There is a case for raising thresholds at the lower end.
4) The level of child benefits.
5) The level of VAT and the exemptions allowable on it.
6) The provision of affordable housing. At one time the lower paid could reasonably expect council housing to be available.
7) The provision of affordable childcare.
Peter, all those matters will indeed be taken into account in assessing benefit claims. But the fact still remains that the amount available to the claimant is just not enough. As I recorded above, it is calculated to be at least £140 a month below the real costs. If only given that people are having to choose between food and sufficient heating, are having to go to food banks and to other charities to sustain themselves and their families. As for Guaranteed Basic Income, that will be eventually (after having been built up from Universal Credit), a sum that can be claimed by people who have no other means of subsistence, and should be reassessed annually by a Commission. It falls squarely in William Beveridge’s wish that, whatever their circumstances, no person of working age should be left entirely without means.
Michael BG: thank you, Michael, for drawing attention to the appalling figures for the number of children living in poverty in single-parent families, and those for workless households, where so many people of working age unable to work through disability or ill-health or caring responsibilities are now liable to be hounded by this heartless government.
Martin Gray. Thanks, Martin, but since there is no possibility that Britain under any conceivable government will rejoin the EU if expected to be in a federal Europe of ‘ever closer union’ and to replace the pound with the euro, I don’t think we need be too concerned about the EU’s neo-liberal leanings.
@ Katharine,
The point about wages is that they are paid by the employer whereas benefits are paid by Govt. Notwithstanding the MMT line that there is no such thing as taxpayer money, it still doesn’t mean taxes won’t have to be increased to enable higher benefit payments.
So, politically it’s a lot harder to try to tackle the problem as you are proposing especially when voters read articles like this. It hasn’t worked previously and it isn’t likely to work in the future. It already makes sense for the HR of companies to advise their employees how to get the most out of the benefit system rather than pay living wages.
“If supermarkets and other low-paying employers know they can secure work even at derisory wages, since pay will be topped up by the state, they have no incentive to offer higher wages.”
The article will be a few years old now but I doubt the figures have improved!
https://www.theguardian.com/sustainable-business/2015/apr/20/taxpayers-spend-11bn-to-top-up-low-wages-paid-by-uk-companies
@ Katharine,
” I don’t think we need be too concerned about the EU’s neo-liberal leanings.”
This doesn’t sound like an “internationalist” sentiment!
Firstly, if any workers, anywhere, are suffering from the effects of imposed neoliberalism, then we should try to explain the process. Otherwise they’ll very likely blame immigrants or some ethnic minority and we all know where that might lead. I perhaps should say is actually leading with the rise of the far right in the EU.
Secondly, even though we are no longer part of the EU, it is still our largest trading partner. If they choose to artificially depress their economies, our exports to them will suffer. Their producers will look to sell in the more active UK market. This led to the large trading deficit we always had with the EU when we were members and will probably continue, albeit hopefully to a lesser extent, now that we aren’t.
Peter, welcome back! Though as usual it’s not too clear what points you are making – what does ‘It hasn’t worked previously’ refer to? As far as I can see, the economy has to grow with productive investment in order for all of us to become better off. No point in supermarkets raising the wages of workers if they then have to put up prices, making us all worse off. As to how the needful increases in benefits have to be paid for, I expect you have heard of the ideas of Richard Murphy, already quite extensively covered in pieces here in LDV, but we are happy to repeat them as needed. But I expect you will agree that you are one of those of the persuasion that benefits are Not a Good Thing and should be earned by hardship, just as the Tories want us to believe.
A point about pay is that, when it is insufficient, the payees are either deprived of sufficient food, accommodation, warmth, healthcare etc. or are supported by the state.
if there are other choices, please let me know.
Neoliberalism is a socio-economic policy which accelerates the “Matthew Effect” or law of cumulative advantage whereby, unless society intervenes, the rich get richer and the not rich get poorer/have less. Like Leninism, it is a “closed theory” which ignores, or cannot see, observable realities such as over 25% or our children being harmed/hurt/hobbled by continuous to permanent hunger/starvation.
Katherine Pindar has well presented some of the “observable realities” of neoliberalism. so does our party have a choice between accepting the current socio-economic theory and practices of neoliberalism or do we do something practical to attack the harms it does to our future, which is our children?
P. S. The Inland Revenue is [deliberately] under resourced, opaque and with working practices which favour the better off and so reforms of a fully resourced I. R. would very probably be sufficient to reduce/remove poverty.
If not, I would prefer not to keep current tax levels to the cost of a quarter plus of our children always going hungry/starving
@ Katharine,
Sometimes I agree with Richard Murphy. Sometimes not. If you mean his point about Govts never running out of money: this is literally true but it doesn’t mean we can solve the inequality problem simply by creating more money for anything that we wish to spend it on. There does need to be a process of redistribution which will involve someone relatively losing out and others relatively gaining. There’s no getting away from the arithmetic of this.
Growth can be useful but neither is it the complete solution as we have seen for ourselves as the economy has grown over previous decades.
We are now a more unequal society than we were in the immediate post war period even though GDP per person is much higher now.
So you think it’s a good thing for low paying employers to be subsidised by the State, in the hope they keep prices down? That’s an unusual POV which most would disagree with. If nothing else, it puts those employers, like the Co-op perhaps, who do believe in paying a living wage at an economic disadvantage.
The point of the Guardian article is that the low paying employers are very much on the side of those who want to increase social benefits. This way they can reduce their wage bill which will do nothing for the living standards of the lower paid.
Peter, I think it is a distortion to suggest we want ‘low-paying employers to be subsidised by the State’, a mischievous distortion on your part. This thread is not about attacking benefits, which are a necessary support system which is underfunded. It is about the Liberal Democrats committing to fight for adequate benefits, and to end poverty. I hope the 15 or so activists who signed the letter to the Guardian in November asking for our party to campaign for bold and distinctive policies which will resonate with the voters will accept that fighting poverty should be our headline issue. I have personally written to Ed Davey to commend this. Why? Because our party is committed to fight poverty by virtue of its constitution, and no other party is so committed to this most needful policy. I hope we can convert the Labour Party to back it in due course, though Keir Starmer shows no such inclination. Is he in any way a Socialist now?
Martin Bennett,
In the year 2020/21 median earnings were £26,300 and mean £37,300, excluding non-
tax payers (https://www.gov.uk/government/statistics/distribution-of-median-and-mean-income-and-tax-by-age-range-and-gender-2010-to-2011). There are measurements of poverty after housing costs, which would be closer to your desired disposable income measurement.
Adrian Sanders,
The party is not going to change from fairness to ‘none shall be enslaved by poverty’ before the next general election. We must try to ensure that after four or five years of Labour failure to reduce poverty in the UK we make it at the heart of our next general election campaign.
Peter Martin,
There is no way to remove everyone from living in poverty unless benefits are increased. In a previous discussion you recognised that those who can’t work or can’t work full time will need there to a benefit system to ensure they are not living in poverty.
You will get no argument from the Liberal Democrats on the need to:
Increase tax thresholds;
Provide more social housing;
And improving the provision of affordable childcare.
It was a Labour Government that increased the subsidising of wages when it introduced Tax Credits. I am not happy that wages are subsidised but the increasing of the National Living Wage to 2/3 of median earnings does reduce this. My aim of increasing it further to 70% would help further. My idea to have a higher minimum rate for London would also help to get closer to the Living Wages which is what the Guardian article you linked to wants people to be paid as a minimum.
You have made no suggestions on how we could influence the EU away from its neo-liberal economics.
I refer to you to Richard Murphy’s https://taxingwealth.uk/2023/09/13/the-taxing-wealth-report-2024-recommendations-to-date-and-their-suggested-value/ where he claims that £111.4 billion per annum of extra revenue can be raised.
Economic inequalities were being reduced when Keynesian economics were implemented but since 1979 inequalities have been increasing because of the economic policies followed by all governments (see page 8 of the JRF 2024 Poverty Report).
The current neoliberal closed minded, observable reality ignoring, thinking has even spread to our military leadership, as pointed out by Richard Murphy.
He asks why young people would want to fight for a society whose leaders afflicted them with everlasting “neoliberal austerity for the many”.
They have suffered the cruelties and socio-economic inefficiencies of:
1) Denial of affordable/free tertiary education
2) Childhood plus poverty and cold
3) Ever increasing need to use food banks
4) Ever increasing likelihood of homelessness and street sleeping
5) Ever reduced/removed health care
6) Ever increasing need of emotional and mental rescue and support
7) A deliberately opaque tax set up which is under-resourced, skewed to favour the wealthy
8) Ever increasing likelihood of working to a zero hours contract
9) An un-sustaining minimum wage and old age pension
10) An ever decreasing likelihood of owning their own place
11) An ever decreasing provision of social housing
12) An evident lack of sufficient provision to manage climate change/disaster
13) Better opportunities abroad [doctors]
And the not-so-young have also been observably, and so, willfully harmed.
Neoliberalism is the opposite of Liberal-Democracy.
Might our party make this fundamental assertively clear in words and actions?
https://www.taxresearch.org.uk/Blog/2024/01/26/many-younger-people-have-no-good-reason-to-believe-in-the-uk-so-why-would-they-f
@ Michael BG @Katharine,
£114.4bn sounds to remarkably precise on the part of Richard Murphy. An implied accuracy of less than 0.1%? We’ll have to see about that. I’d have slightly more confidence if he’d settled for three significant figures. How much of it is going to be spendable will depend on the state of the economy at the time. If money isn’t doing anything in the hands of the rich it is effectively not there in the short term. So taking it off them to spend is functionally no different from creating new money -again in the short term.
The reason for a wealth tax, which I’d favour, is to reduce inequality rather than raise spending money.
Wages aren’t high enough on the lower end of the pay scales to eliminate poverty. The point that both James Meadway (who’s a fan of neither MMT nor Richard Murphy BTW) and myself are making is a direct subsidy of wages on the part of the State will lead to even lower wages.
The only time we’ll see wages rise is when the State decides that minimum wages need to be raised. From the workers’ POV it makes little difference if their wages are 80% from the employer and 20% from the state, or 70% and 30%.
This is not to suggest that all social benefits should be immediately abolished. Rather it is to point out the potential unintended consequence of trying to tackle the poverty issue in the way Lib Dems are proposing.
@Steve Trevethan – blimey, what a depressing picture you paint. To read your post you’d think the UK was one of the worst countries in the World to live in. The reality is, life here is comparable to much of Western Europe/North America/a few other countries, and incomparably better than most of the rest of the World.
To my mind the basic reason it’d be worth fighting for our society is that have freedom: We can believe what we wish, say what we believe, criticise the Government, organise and campaign for what we believe in without any fear of the kind of persecution that happens in much of the rest of the World. Yes, we have lots of problems, but we are also fundamentally free to campaign engage in civic activities, persuade others, and vote to improve our society. Do you really think it’s not worth fighting for any of that in the event of – say, hypothetically – an invasion by an autocratic regime like Russia?
@ Steve @ Simon R
I’d have to agree with Simon. We all have our ideas on how to make the world a better place but we won’t do that by running down the part of the world where do live. We may still have our problems but so does everywhere else. If you want to hear real antisemitism then you’ll still find it in Eastern Europe. I was quite shocked to hear some Hungarian acquaintances a few years ago let loose their on their opinions of Jews, Gypsies or Roma.
Richard Murphy is quite an annoying character. He constantly writes about how the Scots should push for independence. This would be fair enough if actually lived in Scotland or had some family connection. He actually lives in Cambridgeshire and has stated no intention of ever wanting to move any further north!
His recent post which Steve linked to shows his real motivation is to break up the UK. Maybe so all the smaller components will be then be more likely to have to rejoin the EU?
Why are we all so shortsighted?
Everything is soon going to CHANGE, because the silly game now now tediously being played out between Cons and Lab is (surely?) about to collapse under the irresistible clamour for PR.
And with PR something like ten Parties will form the House of Commons; and the weight of Greens will surpass that of the current Lib Dems.
And “UBI” will re-emerge.
All LDs ought now to carefully read the author’s own summary of the Paper by Professor Guy Standing, commissioned by Labour’s Shadow Chancellor on the subject of UBI about five years ago. The summary was rejected, I believe, by the Labour Party, somewhat supported by the slippery Grauniad.
So wise up, dear LDs — and quickly. PROPORTIONAL REPRESENTATION will change Parliament utterly, soon and for good. And Professor Standing’s UBI will WORK, as the
NATIONAL INCOME DIVIDEND
Thanks, folks, for the continuing discussion. Peter M, you are on shaky ground as you quote a wrong figure for Richard Murphy’s calculations. As Michael BG wrote on the 25th at 11.09 pm, the total RM suggested was 111.4 bn, NOT the 114.4 bn you wrote this morning.
Steve Trevethan, thank you for pointing out the numerous problems Richard Murphy says young people in our country today have to face. I imagine the worst of it is the problem of expensive housing, whether renting (in which case the young people can’t afford to save to buy a house) or buying a house: our Young Liberals are onto those problems, and I hope they continue to be militant about it.
Simon R., I am not sure that you are right about us having so much freedom – the Conservatives (despite them putting freedom high up in their values) are much inclined to limit it, for instance in peaceful protest.
Roger Lake – I wish there were ‘an irresistible clamour for PR’ but I am afraid it is being held up by the Labour leadership. And please could you start advocating GBI, which has replaced UBI in our Conference decisions since last March?
I took another look at our Leader’s New Year message just now, and feel that he’s on the way to getting there, but not there yet (sorry, Ed!). Changes he says we’ve always sought, he leads with “entrenched poverty and inequality” , but doesn’t continue to emphasise those. The next relevant mention is worth having: he points out that the Labour Party is “fully signed up to Conservative plans again – even when it means leaving 1000s of children to grow up in poverty.” But that’s it about poverty in his speech. Please, Ed, can you speak out about our plans to halt increase in poverty, and COMMIT US to work to reduce it? Conference have given you permission! We are going to have to show how much we mean it, ever to convince this flaccid Labour Party to DO something about poverty and inequality as soon as they can.
Michael BG:
Comparing 2021 with 2011: in 2021 the median income was 70.5% of the mean income whereas in 2011 it was 71.2%. I was surprised that by this measure, earnings were a little less unequal in 2011. It would be interesting to have data for a longer period (my first searches gave median data but I could not find comparative means.
I cannot comprehend your comment to Adrian Saunders. Part of the Party’s raison d’être is “none shall be enslaved by poverty”; the quotation taken from the Party’s constitution goes to the heart of Modern (or social) Liberalism. It is what all members have signed up for, even if only some understand its roots (Mill ‘On Liberty’, Hobhouse, Green and even echoed by Gladstone). Using the term ‘fairness’ is a relatively weak expression of the principle, though it also includes other aspects of governance.
Deep poverty rots the fabric of a society. It causes hardship, guilt and erodes compassion. We need a radical solution and some sort of guaranteed income is one. We would need pilots and much experimentation to achieve the fairest form. We must be brave enough to inform the electorate that we will not tolerate deep fixed poverty in our country and provide a credible solution.
Dear Readers,
In all seriousness, if anyone can refute any of the 13 neoliberal harms and/or cruelties I listed above, would they please, please do so.
“If someone can prove me wrong and show me my mistake, I shall gladly change.”
(From Roman Emperor Marcus Aurelius)
Doubtless there are worse places than Britain in which to live, but that truth misses what I intended/intend to say.
When we compare ourselves, or whoever/whatever with others we are using normative referencing.
It is recommended that we do [far] less norm referencing and much more ipsative referencing and criterion referencing.
Ipsative referencing/assessment evaluates performance in relation to previous performance.
Criterion referencing asses against specific/specified qualities without reference to the achievements or lack of relating to others.
When we compare our aspirations and performances with others, it pays to compare with those who have achieved more of that which we might wish to achieve. That way we are more likely to learn and less likely to be tempted towards complacency.
Please look at the early years education and its access in Denmark. Ditto is equity/Gini Index. It is a member of the European Economic Area and so has access to the E. U.
@ Katharine,
You’re on shaky ground yourself, Katharine, if you are making a big thing about the typo. It really doesn’t make any difference if RM is claiming 111.4bn or 114.4 bn.
To answer your previous point about the failure of most previous anti-poverty campaigns: they don’t work because they don’t require anything, or at least not enough, in return. If they had worked we wouldn’t be discussing the issue quite so often as we do. The exception has been the introduction of the minimum wage which has had a significant positive impact.
The minimum wage needs to be set at the current level of the “living wage” as a first step. The next one is to be realistic about what a living wage might be – especially in the more expensive cities. The one after that is to ensure that everyone has enough access to paid employment to actually earn the minimum/living wage.
I don’t see why anyone has a problem with these proposals.
@ Steve Trevethan – Thanks for the reference to “Late Soviet Britain” by Abby Innes.
I hadn’t come across either author or book before, but available reviews point to such factors as “weakened governance”, stifling bureaucratic overreach”, “economic stagnation” and “political dogmatism” (all taken from reviews on Waterstones’s website) being behind the failure of the Soviet approach and, perhaps curiously given that the driver was from the opposite end of the political spectrum, the Britain that 45 years of neoliberalism has made.
That feels about right. Could it also be part of the reason for the LibDems perennial failure to break through the glass ceiling? I suspect it might be.
@Steve: Actually comparing with other countries is not only useful but is essential for your argument because, without that comparison, you have no way to judge what level of prosperity/freedom/opportunity/fairness/etc. is actually practically possible for a country to achieve given the current state of humanity/technology/etc. With nearly 200 countries in the World, with a huge variety of political and administrative systems etc., looking at the most successful countries should give you at least some idea of what is likely to be realistically achievable. I’m pretty sure you’ll find that comparison will show that on most measures, the UK is a remarkably successful country and good place to live in (and there is strong evidence for that too in immigration levels: If life here is as bad as you’re making out, why do you think so many people from so many other countries are so desperate to come to the UK?)
But either way that doesn’t change the issue that you posted a list of alleged negatives about the UK, without mentioning any of the positives. Ignoring all the positives is not a good way to fairly judge whether a country is worth defending!
Martin Bennett. I have to agree with you, Martin, that I thought Michael BG’s comment to Adrian Sanders was unnecessary (he tends to be more pessimistic than I am!), since if we have a mission and a purpose – and we do – we should not be content to leave attempts to fulfil them to the next Parliament. As I see it, we can and should eventually revive this strangely latent purpose (I presume) of the Labour Party, to tackle poverty and inequality, by convincing the voters of the need for it, at the same time as showing voters that the Liberal Democrats believe in and will take a lead in the effort.
Peter Hirst, thank you for your post on the need to fight deep poverty and inform the voters that we intend doing so. In fact, we have already got a plan to do so, as passed by the last York Conference and incorporated in the Pre-Manifesto motion passed at last September’s. And Michael BG wrote here in LDV a piece on ‘Ending deep poverty by April 2029’ which you can find if I remember rightly in the November Archive. (I will check that for an exact reference.) Let us by all means discuss the development of that solution, to assess and hopefully confirm its credibility.
In fact I find Michael BG’s piece on Ending deep poverty by April 2029 was published here on October 6, 2023, not in November. It is well worth re-reading.
Peter Martin, we agree on the need for a good Living Wage: desirably, 70% of the median. But I believe it is in vain to think that ‘access to paid employment’ will ever negate the need for welfare benefits, a subject we have explored extensively on other threads.
Steve, thank you for further interesting contributions, and Gordon and Simon R for your responses to them. Simon, I think there are so many negatives in our country now that they do outweigh the positives, which is a reason for dwelling on them.
Peter Martin,
The implied accuracy of Richard Murphy’s total is to the nearest £100 million and so ignoring five figures. The revenue from taxing the wealthy would only be like creating new money if the wealthy held the money as cash rather than in banks where the banks spend the money.
Richard Murphy says that an annual wealth tax would be difficult to collect because of the difficulty of valuing the wealth of the wealthy every year. I did submitted a motion on creating a wealth tax to the Spring Liberal Democrat Conference but it wasn’t selected.
As I pointed out it was the Labour Government which changed the benefit system so those in work would receive more benefits. The Conservative Government by reducing the Universal Credit taper has increased the subsidising of wages. I have argued that the taper would need increasing on higher amounts of income from earnings if benefits were at the poverty level and everyone claiming UC would be eligible for a work allowance.
Martin Bennett,
We agree that part of the raison d’être of the Liberal Democrat Party is that “none shall be enslaved by poverty”. My point was that the party is not going to change its messaging from fairness to ‘none shall be enslaved by poverty’ before the next general election. I don’t understand why you can’t comprehend my point. I hope we can get the party to tell people about our policy of ending deep poverty within the decade during the general election.
“There is, in Nature, no reason for poverty”, a quote from the author of “Progress & Poverty” 150 years ago: Henry George. The man who inspired more people than Karl Marx, at that time, by the messages in their seminal works. The Liberal Party came to Government because of its support for that idea: Land Value Taxation (LVT).
Joseph Rowntree was a supporter of LVT. He set up his Foundation to tackle the “underlying causes” of poverty, not alleviate its “superficial manifestations”. He said: “Every Social writer knows the supreme importance of questions connected with the holding and taxation of land, but for one person who attempts to master this question there are probably thousands who devote their time and strength to relieving poverty and its accompanying evils.”
In ALTER, we are getting close to mastering this question. We believe we know how Lib Dems in Government, with supporters of LVT in other parties (there is an APPG that Sir Vince Cable chaired when we helped set it up in 2018) could replace all local government finance and alleviate much national taxation of earnings, by an equivalent amount of revenue of income unearned from Natural Capital – primarily land rental values.
“The Economy is a wholly owned subsidiary of the Environment” (Herman Daly). That’s where Neo-Liberals get it wrong. The laws of supply and demand don’t apply when “they don’t make it any more” – as Mark Twain said of land.
Oh, and LVT is already Lib Dem policy.
Tony Vickers. Thank you for that interesting recap of why Land Value Taxation is desirable (though I believe people’s own homes would be exempt) and why our party supports it. I had been wondering when this could be achieved. I suppose we shall be no nearer bringing it about, unfortunately, till we bring the Labour Party into shared enthusiasm for it, and perhaps Guaranteed Basic Income is an easier aim to persuade them about. However, the aim of shifting some of the taxation burden from earned to unearned income is already party policy to be pursued. And it is surely high time that the party accepted that council tax meantime is unfairly applied and its application needs reform. Michael BG has I think three times tried to get a motion on that into Conference debate. This may be a case where we need to walk faster before we can run.
@ Katharine,
Why would anyone need welfare benefits if they were paid at the true living wage?
If they are sick they’ll still get paid. They’ll still be entitled to NHS care. If they are disabled they’ll be entitled to whatever extra support they might need which can be administered by the NHS which can be expanded to include social care.
Yes taxes may need to rise.
Hi, Peter M., I think you are forgetting the complexities of working people’s needs, in imagining a happy country where everyone can get a sufficiently adequate wage for they and their families to live on. What if you have to work for an employer who won’t pay it, or offers zero-hours work? What if you have caring responsibilities and have to do several jobs at once, as many single parents have to? We need and have complex benefits to try to cope with varied situations, including child care and housing problems, but sanctions and limits and basic inadequacity of the payments mean they aren’t good enough. Please can we step away from reasonably comfortable retirement to consider the struggling, insecure and sometimes miserable position of millions of our fellow citizens?
“Why would anyone need welfare benefits if they were paid at the true living wage?” Because the wage at which families can live varies. Why would any employer pay a severely disabled person with four dependant children in rented accomodation in London the wage they need to live (probably above the national income) when they could hire a single homeowner whose living wage is a fraction of that.
* National Mean Income.
@Peter Davies,
As far as I know there is no-one seriously suggesting that wages should be variable to take into account the different personal circumstances you mention. If you think workers with children need extra support then advocate for higher child benefits and/or some recognition of child support in the taxation system.
If you want to close the gap between property owners and renters then introduce a tax on the ownership of property. This can be on a sliding scale so that those who buy on a mortgage are only taxed on their positive equity.
The scale of disabilities does vary. There’s no reason why, for example, those with Down’s syndrome shouldn’t work. Yet, it’s quite difficult for many to compete on the jobs market.
https://www.downs-syndrome.org.uk/about-downs-syndrome/lifes-journey/employment/
@ Katharine,
“What if you have to work for an employer who won’t pay it, or offers zero-hours work? ”
This is why there needs to be a Job Guarantee. So you don’t have to!
Tony Vickers,
In 2018 the party passed a motion to replace Business Rates and Non-Residential Stamp Duty with Commercial Landowner Levy and in the accompanying paper, which you are credited with reading earlier drafts, it states that when implemented in England and Wales government revenue rather than increasing falls by £1.242 billion.
Peter Martin,
There is no way to remove everyone from living in poverty unless benefits are increased. In a previous discussion you recognised that those who can’t work or can’t work full time will need there to a benefit system to ensure they are not living in poverty. You seem to be moving away from this sensible position when you imply there would be no need for welfare benefits if people were paid at the true living wage.
Then in response to Peter Davies you still can’t bring yourself to write that some people will need benefits to top up their wages even while writing you are not advocating that wages should be variable to take into account the different personal circumstances which is the only circumstance where workers would earn enough to meet all their household’s requirements.
In the past you have been against a land tax on residential property. Now you seem to want one on property where the owner lives in their property. How are mortgage payers who are having problems paying their mortgage going to afford to pay your new tax on the ownership of property?
@Michael BG,
Those buying on a mortgage would only be paying property tax on the equity they have in it. This could be calculated on the basis of what the rental income would be. So if it were, say, a 90% mortgage, and the rental value was £1000 p.c.m with a property tax of, say, 20% the monthly tax would be £20 p.c.m. This would rise to £200 p.c.m as the equity approached 100%.
So buying a house would still be a good deal compared to renting. If you’d want to close the gap further you’d have a higher rate of tax which could of course allow other taxes to be reduced.
I suspect Lib Dems don’t want to close the gap at all! Such a policy won’t win too many votes from wealthy homeowners in the wealthy London suburbs!
My point on a LVT was that it would be just another tax, not a single tax as suggested by Georgists, and offer nowhere near the benefits claimed. If you want one then put one in your manifesto. Again, I can appreciate you won’t do that if you want to court Tory voters.
I’d prefer we called social benefits ‘sick pay’ for those who are too ill to work. But I don’t suppose it makes that much difference.
@ Katharine,
” we agree on the need for a good Living Wage: desirably, 70% of the median”
It’s good we agree on something! 🙂
I’m not sure about the “70% of the median” figure though. I’d like to see a figure more defined by an average or mean, rather than the median. For reasons previously explained by others in this thread: The more inequality we have, and we all agree that it is too high, the greater the difference between the median and the mean.
@ Michael BG,
“The revenue from taxing the wealthy would only be like creating new money if the wealthy held the money as cash rather than in banks where the banks spend the money.”
The banks might lend the money but that’s not the same thing as spending it. In any case there’s a good argument to suggest they don’t actually lend out reserves but they simply create new money as they lend.
If I have say £1000 in cash this is effectively a deposit at the BoE. If I look at my commercial bank account and see the same figure I still have a £1000. It doesn’t change anything – providing of course that my bank hasn’t gone bust!
Peter M. Without going into details. I think the Liberal Democrat view of bringing in a Land Value Tax would be that it shouldn’t apply to the family home, whether the home owner were rich or poor. Of course if the home owner had other properties I assume they would have to pay a tax on their value.
I read last week, talking of houses, a sobering article in the Times from former Tory PM William Hague, who pointed out that this country is desperately short of the workmen and craftsmen who can build houses, and they are not coming through in any numbers from today’s young people. It sounds as if the country needs a technical rather than citizen army, to get youngsters good at DIY into the building trade! As the article concluded, people advocating 300,000 new houses being built in the near future should consider how the necessary building trades people are to be found. No easy solutions.
@ Katharine
I agree with “no easy solutions”
However if you want to reduce the income differential between potentially neighbouring families who are renting or have full equity in their ownership there is only one possibility.
You need to do it via the tax system.
I don’t care, Peter. if there is an ‘income differential’ between neighbouring families, one owning their own home, the other renting, unless the second family is trapped in paying a huge proportion of their earned income on rented property, with no chance to save for a deposit. We know that much poverty (along many times with poor health outcomes) arises from people being unable to move on from poor quality housing or obliged to pay for expensive private rented accommodation, or next becoming homeless because of debt. So the cry goes up, Build more social housing, Build more houses altogether so the cost of them falls! But if in current circumstances not enough new housing can be built (small hope of the Lib Dem ‘ten new towns’), what then? Yes, get all houses well insulated (first of all the old or ill-built and mouldy) and… limit the power of individuals to keep houses empty for finance speculation, and limit buy-to-lets and air b-and-bs? – surely, encourage councils to take powers to commandeer persistently empty houses. I suppose there will have to be some freedom-limiting measures, at least in cities and coastal resorts?
Peter Martin,
Your new tax on the ownership of property is like rates were meant to be. I am not sure that those with a mortgage pay less on their mortgage than they would do renting. However, you haven’t addressed my point that mortgage payers don’t have any spare money to pay another tax. This is especially true with mortgage payers who are facing huge interest payment increases when their fixed rate mortgages end.
You have often written that if there were a tax on land this would be passed on to renters. Therefore if the owner of a home was taxed as you suggest and rented it out they would pass it on to their tenant.
I assume that organisations owning homes will not have to pay your tax.
Sick pay is a benefit.
Saving cash and saving in a bank are not the same as I have explained. It could be argued that £1000 in a bank is better than the government spending it because the bank will use the £1000 to create more than £1000 in lending, which will then be spent.
I hope that replacing Business Rates and Non-Residential Stamp Duty with a Commercial Landowner Levy will be in the manifesto. One day I hope party policy will be to replace Council Tax with a percentage tax on the value of homes.
@ Katherine : “ limit the power of individuals to keep houses empty for finance speculation”
There is no evidence this is actually an issue
“ and limit buy-to-lets”
Why ?
@ Katharine @Michael BG,
The ownership of property can generate an income regardless of whether there is any financial transaction involved. Richard Murphy has picked up on this himself claiming that 10% of UK’s GDP is made up of something that “simply doesn’t exist in the real world”. This a surprising thing for an accountant to say because anything that affects our personal balance sheets, as the ownership of property clearly does over time, must exist as those who collate GDP figures apparently acknowledge.
The figures he gives are: £87 bn in actual rents. £231 bn is imputed rents.
This is £231 bn of income going to the generally better off who pay no tax on it whereas the £87bn in actual rents are paid for out of after tax income.
Those who own property like it to be expensive for obvious reasons. If they (we?) had to pay income tax on imputed incomes we might take a different view and do what it takes to make property more affordable for younger generation.
Such a system did once exist: Schedule A tax but was abolished in 1963. If reintroduced, it would tilt the balance towards renters and away from long term owner occupiers. It wouldn’t make much difference to new buyers. Most only have a small equity in the property to start with. In the longer term it would help because existing owners wouldn’t be quite so keen to see rental and property values rise.
https://www.taxresearch.org.uk/Blog/2023/02/14/10-or-gdp-is-made-up-it-simply-does-not-exist-in-the-real-world/
@ Michael BG,
You’re confusing the criticisms I made of the LVT with recent comments about the inequity of the UK property market. Both purchase and rental. There is more to it than just land.
It has acted as a disproportionate tax on the less well off who are forced to pay “dead money” in rents whereas the more affluent have generally benefitted from rising property values.
The “spendability” of any extra revenue raised through a wealth tax can be gauged by assessing the spare economic capacity and the likely affect any wealth tax will have on aggregate demand. If there is no spare capacity and no reduction in aggregate demand, the spendability is zero.
It probably won’t be, but it won’t be as much as many on the left would assume. We should still have one though!
If we take money in tax from the less affluent it will have a greater effect than if we take it from the more affluent. But it really doesn’t affect our spending patterns if this money is held in cash, in a bank, or even in bonds. The mainstream gets this wrong too by treating bonds differently from money, whether this is held in a bank or in cash.
We can understand why by looking at our own spending patterns. If we are thinking of buying a car does it really matter if we have cash in a safe, money in the bank or the same amount raiseable from the sale of bonds?
“this country is desperately short of the workmen and craftsmen who can build houses”
Why can’t we have modular housing? Like a car, only instead of being stored on the public highway, your new house gets moved, possibly using an airship in one lift, onto a slab of concrete with thermal insulation, water, electricity and sewer connections. Then houses could be made in factories by relatively less skilled people. There are already factory built houses that come in big panels on lorries and sections craned into position and bolted together on site. No doubt the houses would end up being made in China, but we’d still get more housing!
Simon. I was thinking of the property speculation in London, with financiers from abroad buying property as an investment rather than to use to house people. I don’t know how this could be regulated. You are right to query, I was thinking of Air B&Bs rather than Buy to Let! Thank you for clarifying.
Guinevere, thank you. I agree with you, there surely ought to be a place for modular, factory-built housing. Then there will still be the argument for where they can be built with local consent, but I know the Labour Party is suggesting there is land that could be utilised that is neither of brown nor green designation, do they call it ‘grey’?
Peter M., that sounds interesting, but you have lost me – what are these ‘imputed rents’ mentioned by Richard Murphy, and are the owners of these properties – I am guessing they are standing empty – actually gaining any income from them?
Katharine,
No, he’s including the house that I live in and possibly yours! So I’m not advocating the change out of personal interest. The mortgage is paid off so I’m living in it for free. The argument is that I have an imputed income of whatever the rental value would be.
This used to be taxable until Schedule A tax was abolished in 1963 and it may still apply to companies which own property. Joe will be able to give the Lib Dem take on the merits or otherwise of this tax and how it would fit in with his proposed LVT.
I appreciate that no party will ever dare do this but if fairness were the only criterion it is how the tax system should work. There needs to be a recognition that buying a property is like buying a share in a company. It’s an asset swap rather than a spending loss. It usually has been in recent decades.
An example would be the owner of two properties: One of which is lived in and one which is rented out. The first isn’t taxable at all currently. The second is taxable. So, any change to a property tax needn’t affect the economics of renting. Although it could, if the tax rates were adjusted to make rental properties cheaper. This would be possible if the tax collected on the first property was included in the total tax take calculations.
Thanks, Peter. I’ll leave the economics of housing to the better-qualified now, but want to draw attention, at a time when the Chancellor is said to be actively considering tax cuts, to some excellent arguments against them from Left-of-Centre economist Will Hutton in a recent Observer piece (21.01.24). He suggests any spare (£10bn or so!) expected by the Chancellor to gratify his troops in his March Budget statement would be better spent on guaranteeing commercial bank loans to big investment projects, which are much needed. And he points out that, while tax receipts generally may be at a 40-year high, “taxes on the wealthy remain at a 40-year low. Wealth – in housing, land, pensions, art – has risen from three to seven times national income over the past 40 years. But the tax contribution of the wealthy remains stuck at 3.5% of national income – unsustainable…” Hutton cites the IFS director Paul Johnson as saying that, and also Labour MP Liam Byrne in a book. Is Labour Party leader Sir Keir then foolishly obdurate in refusing to contemplate a Wealth Tax, as in other matters?
I can’t help feeling that “guaranteeing commercial bank loans to big investment projects” just because you have the money to do it would end up with a lot of big investment projects designed to fail leaving the promoters of the projects and the banks a bit richer and the government a bit poorer.
Peter, I am confused. Your idea is ‘If you want to close the gap between property owners and renters then introduce a tax on the ownership of property.’
That would make home owners poorer, but I don’t see what else.
If your idea is that it would cause house prices to fall, any sharp correction would leave millions of mortgage payers in negative equity. So while house prices are horrendous and a barrier to many aspects of life, there are no easy answers.
Katharine,
” Is Labour Party leader Sir Keir then foolishly obdurate in refusing to contemplate a Wealth Tax..!
I don’t think foolish is the right word. I’d use words like dishonest and cynical. He’s not particularly interested in anything other than winning the next election and so becoming PM. He presented one face to the the Labour Party to win the election for leader and he’s presenting another to the wider electorate now. He looks like he’s succeeding in his aims.
I won’t be voting Labour this time.
@ Cassie,
You’re right. Houses are have been used as collateral to float the economy on a sea of private debt. In spite of what politicians might say they will do what they can to try to prevent the bubble bursting and keep them high.
They may not always be successful though – especially if there is another crash.
Peter Davies. Hi, Peter. Will Hutton also says that the government is already experimenting with the idea of guaranteeing commercial bank loans (which, you are surely right, would possibly leave the government a bit poorer) through “the UK Infrastructure Bank’s ‘sovereign investment guarantee’ to private banks that lend on infrastructure projects. None of the £10 bn counts as public borrowing; only the separate £4.5 bn risk capital the taxpayer puts up to back the guarantee.” He wants this facility extended.
Peter Martin,
You have not addressed the issue that those with mortgages can’t afford to pay your new tax on the ownership of property.
You seem to be now writing that if the house has a tenant then the tax is not payable. A recipe for avoidance.
When you talk about imputed rents you remind me of Joe Bourke who wants a land tax on these imputed rents. It seems you have changed your mind and now you do support a land tax on some homes.
However, you admit “no party will ever dare” implement such a new tax on the ownership of property.
Your focus on not spending cash and not spending money in a bank as being the same for the person is ignoring what happens to money in a bank or in a bond. As I have pointed out for every pound deposited in a bank the bank could lend more than one pound and those who borrow this money then spend it into the economy.
Guinevere Barnes,
I wonder if it is more difficult to get house insurance on modular housing.
Katharine,
Here is a link to the Will Hutton article https://www.theguardian.com/commentisfree/2024/jan/21/jeremy-hunt-instead-of-blowing-billions-on-tax-cuts-spend-it-on-boosting-uk-growth where he talks about the UK Infrastructure Bank’s “sovereign investment guarantee” and the government investing £10bn in it to bring about £20bn more for infrastructure projects. This would mean there would be the £30bn for infrastructure spending which the National Infrastructure Commission says is needed each year.
Deflating a bubble without bursting it is very tricky. Almost all mortgages start with at least 5% equity and a requirement to pay back a small amount rising each year. That means that house prices can fall in cash terms by a small annual percentage (maybe 2%). The five percent gap will not quite close before the repayment rate exceeds the rate at which property prices are falling. Add on 3% inflation and you can get a significant drop in real terms within five years. That sort of fall would require either a financial crisis (like now) or a big building boom.
More worrying is what it does to the rented sector. In the long term, lower house prices mean lower rents because it is cheaper for landlords to get into the sector but continuously rising property prices were a major incentive to buy-to-let landlords. Right now, sale prices are falling but rents are rising because nobody is buying to let. The cost of renting is already too high relative to the cost of buying so we need to look at how we bring that down.
Our image of the landlord is shaped by the cartoon character from Monopoly. To some extent, it’s been self-fulfilling. The economics of the sector needs transforming to the point that a respectable Plc could enter the sector and sell on the basis of quality service. We are miles from that and I know nobody with a plan to get there.
@ Michael BG,
Yes I have addressed these issues.
Consider the owner of two properties: One of which is lived in and one which is rented out. The first isn’t taxable (at National level) at all currently. The second is taxable. So, any change to a property tax needn’t affect the economics of renting. Although it could, if the tax rates were adjusted to make rental properties cheaper. This would be possible if the tax collected on the first property was included in the total tax take calculations.
For new buyers the tax would effectively be on the equity of the property. In their case this would be very low. Typically they would only paying something like 10% of the tax of their fully paid up nextdoor neighbour. One way of doing this would be to allow interest payments to be offset against income tax as used to happen as a matter of routine at one time.
You might want to read up on how banks actually lend:
“— banks do not act simply as intermediaries, lending out deposits that savers place with them, and nor do they ‘multiply up’ central bank money to create new loans and deposits”
https://www.bankofengland.co.uk/-/media/boe/files/quarterly-bulletin/2014/money-creation-in-the-modern-economy
@ Peter Davies,
“Deflating a bubble without bursting it is very tricky.”
Agreed. Difficult but perhaps not impossible.
The economics of the sector needs transforming to the point that a respectable Plc could enter the sector and sell on the basis of quality service. We are miles from that and I know nobody with a plan to get there.
What about the German model? They seem to have developed a workable system which is much better than our own. So why not copy the best features of that and possibly add a few of our own?
https://www.theguardian.com/uk-news/2023/nov/23/germany-proves-private-renting-can-work-better-britain
“Typically they would only paying something like 10% of the tax of their fully paid up next door neighbour…’
This seems to assume that no mortgage/rent = money to spare to afford other bills. Far from a given. Another problem is take two neighbours, both mortgage-free. Person A has lived in their house five years, in which time it has gone up £30k in value. Their next-door neighbour has lived in theirs 20 years, in which time it has gone up £90k in value…
Peter Martin,
Please point me to where you point out how someone with their fixed rate mortgage more than doubling will be able to afford the huge increase in their mortgage payments and your new tax on the ownership of property?
It is Liberal Democrat party policy to abolish no-fault evictions.
@ Michael BG,
The affordability of a property tax to new buyers will depend on several factors:
1) The level of the tax.
2) The extent to which the tax is minimised for new buyers. Measures could include tax relief on interest payments, the expenses associated with the purchase.
3) The extent to which the raising of taxes on more established owners allows for a reduction in other taxes.
4) The effect of the tax on the property market generally. It should act as a disincentive for speculation.
The intention is to raise taxes on those who aren’t currently paying anything, at national level, and have done well in the property market in recent decades.
Let’s widen this debate. I was struck by a mention on Newsnight just now that Keir Starmer might possibly be rowing back from theircommitment of spending £28 bn on green investment spending. I am thinking, if you have to ‘row back’ from spending commitments in view of dire economic news nationally, what do you choose to sacrifice? What would the Lib Dems do? Well, unfortunately, we already have: we abandoned the ‘1p on income tax pledge, was it for the NHS (in dire straits now, were we right? ) Or was it for education? The real needs continue, and grow.
We could say, we are not going to be in government soon, so we can commit to spend more. But we are too seriously committed to gain a share of power to be irresponsible like that. We could say, our expensive commitments are properly costed, so we will hold to them, and try and convince the next government to adopt them. (The proper costings having been offered here on LDV by Michael BG.)
Still, there may be a time when we will have to prioritise our commitments. And I say to our party, MAKE LESSENING POVERTY OUR FIRST COMMITMENT – please. It is so much needed, and the Labour Party makes no such commitment. Let’s put it first.
Katharine Pindar reminds us of how little change we will get from Labour. Right now, it looks as though they have abandoned any pretence of a radical programme. No higher spending on Green Policies, no cap on bankers’ bonuses, no single market, no custom’s union, no change to the voting system. Just a nebulous clim that they won’t be as bad as the Tories!
Talk about an open goal. We need our leadership to start pushing our different, radical agenda, or if they can’t or won’t, stand aside for someone who will.
@ Katharine,
You’re right that the poverty issue is wider than housing but it is one area where you could get a large measure of agreement that something needs to be done and so outflank any slight trace of radicalism which may still be present in the Labour leadership. There’s still plenty in the Labour party itself.
A decent home is a pre-requisite for any child to do well in life. If there’s nowhere to do homework etc…. This doesn’t have to be explained to voters.
The issue of poor and expensive housing is also tied in with the mainstream’s penchant for neoliberal economics: The fundamental cause of poverty in a wealthy society. Those who are of a more Keynesian persuasion would argue that if demand has to be restrained to control inflation it should largely be done through the taxation system. This way we can all share the burden. The monetarists, neoliberals (call them what you like), however, have chosen to use the level of interest rates.
This means that those who have to make do with less are largely young families with children who have to pay through the nose for housing either in the form of high mortgage payments or high rents. The situation is now much worse than when Ken Loach produced his “Cathy Come Home” play in the sixties and is one the most significant, if not the most significant, causes of poverty now.
Mick Taylor. “We need our leadership to start pushing our different, radical agenda…”
Absolutely right, Mick, and everyone needs to join in pushing them to do so. There are hundreds of non-target seats where our party activists glance mournfully at our national opinion polls and long for a bit of positive publicity to help them in their work, and a shared clear answer to the doorstep question of why voters should decide to vote for us rather than the Labour Party. The Mid-Beds by-election showed how voters can decide Labour is a better bet – they are after all expected to be in power soon. We surely need to give the country a sense of a strong driving force in the Lib Dems that will hold Labour to its more progressive side.
Peter M. The present-day cost of housing is indeed seen as one of the drivers of poverty, Peter, and I take your argument about neo-liberal economics using interest rates to keep the cost of both buying and renting too high for public good. I think in terms of the young people having to pay too much of their earned income on housing to be free to get on in life in other ways, and the equally unfree young people still living in a parent’s home even into their 30s because of the costs. What seems imperative is the need for councils and housing associations to build more socially-rented homes as soon as possible; never mind for the moment the idea of building new towns, whether ten or two of them.