In the late 19th century, Charles Booth, born into a privileged family in
Liverpool before making his money in shipping, did more to expose poverty in
Britain, and in particular in London, than anybody else.
Booth’s study, Life and Labour of the People in London, was published in 17
volumes, the last of which appeared in 1903. It shocked Victorian England,
revealing that in the East End of London 35% of people lived in abject
poverty.
Booth set the standard for subsequent social research, and helped prompt
reforms including the early welfare state, notably Lloyd George’s
means-tested pension of 1908. Tramping the streets of London and producing
his mammoth study was hard work. “I cursed every minute I gave to it,” he
said later.
Iain Duncan Smith, the former Tory leader, is in many ways as unlikely a
social reformer as Booth. Humiliatingly deposed from the job in 2003 when he
lost a vote of confidence among his own MPs, the self-declared “quiet man”
could have retired from public life with his tail between his legs. Having
made his name as a dryas-dust rightwinger and Eurosceptic who helped make
life impossible for John Major in the run-up to the 1997 election, Duncan
Smith might have been expected to spend his free time campaigning against
the European Union constitution.
Instead, in 2004 he set up the Centre for Social Justice, a think tank aimed
at promoting a strong society and solutions to the problems of poverty that
blight so much of modern Britain. When David Cameron became Tory leader in
December 2005, he appointed Duncan Smith to be chairman of the party’s
Social Justice Policy Group, to “study the causes and consequences of
poverty in Britain and seek practical ideas to empower the least well-off”.
Last week the group published its second set of six volumes, under the title
Breakthrough Britain: Ending the Costs of Social Breakdown.
“For the last six years, I have been visiting many of Britain’s most difficult
and fractured communities,” says Duncan Smith. “I have seen levels of social
breakdown which have appalled and angered me.
“In the fourth-largest economy in the world, too many people live in
dysfunctional homes, trapped on benefits. Too many children leave school
with no qualifications or skills to enable them to work and prosper. Too
many communities are blighted by alcohol and drug addiction, debt and
criminality and have low levels of life expectancy.”
The worst of it is that many of these problems are self-inflicted; the product
of misguided welfare policies. Even where jobs are available the benefits
system, far from providing people with a leg-up in the job market, is often
a ball and chain.
People on benefits wanting to get a job, or move from part-time into full-time
work, face punitively high marginal rates of tax and benefit withdrawal, and
risk the loss of entitle-ment if it does not work out. For many, the easiest
thing to do is nothing. Immigrant workers, without these encumbrances, are
happy to take up the jobs.
Duncan Smith’s travels, along with fellow group members, have taken him to
Glasgow, which contains 70% of Scotland’s most deprived neighbourhoods, and
where a third of people of working age are economically inactive, and 50% of
all households have no earned income.
“It’s bad everywhere, and then there’s Glasgow,” he says. “But all the same
problems Glasgow has are being repeated in other cities; Moss Side in
Manchester; Handsworth in Birmingham. Nobody works on these estates and the
kids roam around doing what they like.”
They have taken him to Tower Hamlets, in London, where the contrast between
rich and poor must be one of the starkest in the world. The borough houses
Canary Wharf, where international bankers strut their stuff and earn
telephone-number salaries. But a few hundred yards away from the gleaming
towers is a large area in which only 55% of working-age people are in jobs,
economic inactivity is 38% and levels of social deprivation, in relative if
not absolute terms, are as extreme as those uncovered by Booth a century ago.
The details of the latest reports make grim reading. Britain, they say, has a
“unique” record of family breakdown; with devastating consequences. Children
experiencing family breakdown are 75% more likely to fail at school, 70%
more likely to be a drug addict and 50% more likely to have alcohol problems.
In the past 10 years the number of lone parents has risen from 1.6m to 1.9m,
and the evidence on unmarried versus married couples is persuasive; nearly
half of the former split up before their child has reached the age of five,
compared with one in 12 for the latter.
Family breakdown costs the taxpayer a conservatively estimated £24 billion a
year. Add in the costs of educational underachievement, £18 billion, and
crime, £60 billion, and the bill comes to more than £100 billion. Yet Gordon
Brown has presided over tax and benefit changes that discriminate against
married couples, particularly those on low incomes.
A one-earner married couple in which the earner moves from part-time to
full-time work faces a marginal tax rate of more than 90% in Britain, the
highest in the western world, compared with an average of 55% for other
industrial countries. A two-earner couple with a combined income of £35,000
would be nearly £5,500 a year better off living apart, thanks to the
perverse way Brown’s tax credits work.
The social problems uncovered by Duncan Smith and a team of more than 50
volunteer experts explain why Britain spends more on welfare benefits
excluding pensions, £79 billion, than on education, £73 billion. They
explain why, though Britain has become more prosperous, it has become more
dysfunctional. In many parts of the country, we have a broken society.
MARGATE, on the Kent coast, used to be one of Britain’s most popular seaside
towns, a haven for Londoners seeking a two-week summer break from the smoke.
It was the first resort to introduce donkeys and deckchairs.
Today, like many of Britain’s faded seaside towns, Margate, with a population
of 40,000, is a shadow of its former self. While the beach remains intact,
the boarded-up shopfronts testify to the fact that all is not well on the
crumbling high street. Rundown and depressing, it is a microcosm of the
social problems facing the country today.
In Margate central ward, 42% of the working-age population is dependent on
benefits; 18.8% of 16 to 18-year-olds are “Neets” – not in education,
employment or training – and 10.9% of working-age households are lone
parents with children.
Kerry Smith, is one of Margate’s single mothers. At 23, she already has two
children and another is on the way in less than a month. Her former partner
left after the birth of her 16-month-old daughter, Bethany. Her other
daughter, Megan, is 2½. She lives, rent-free, in a two-bedroom council flat
and receives £150 a week in child benefit, tax credits and income support.
“My partner left because he didn’t like the responsibility,” she said. “I
would much prefer it as a family unit if he was around but it hasn’t worked
out.”
Having left school at 16 with five GCSEs, she worked as a barmaid and would
like to return to work. “I have to say £150 a week doesn’t go a long way but
the kids get their food and clothes – but they don’t get designer stuff
unless I can afford it,” she says.
Also in Margate, 16-year old Cal-lum Reidy has not worked since quitting a
college course four months ago – and says he has no hope of finding a job.
Sporting sovereign rings on each hand, plus a baseball cap, he says he has
plenty of time to kill.
“There’s nowhere around here that’s offering jobs. Margate is rubbish –
there’s nothing to do,” he says. It is lunchtime, but he confesses to not
usually being up by then. He lives on handouts from his mother.
“I always stay up until 2am or 3am, just watching telly and stuff by myself in
my room,” he says. “Then I get up late. During the day there’s not much to
do. I just stand around on the sea-front smoking fags and spitting. My
friends are pretty much the same. They just sit around smoking weed and
that, passing the day away.”
It is not all bleak. Fiona Napier is one of the people hoping to turn Margate
around – by offering jobs to the “unemployable”. She hires young offenders,
people with learning difficulties and disabled people at her restaurant
Impressions, set in the heart of Margate’s old town. Her Focus to Work Trust
intends to turn the tide of deprivation.
“Our philosophy is, ‘Everybody is capable of getting meaningful employment’,”
she says. “When you are tackling problems of deprivation it’s important to
remember that people don’t just have one problem, there are usually multiple
things. We need more organisations like us, and more funding for them.”
That encapsulates the central theme of Duncan Smith’s reports, summarised by
Oliver Letwin, head of the Tory party’s policy review, who has been closely
involved in the Social Justice Policy Group.
“What this has made us understand is that there is not a single, silver-bullet
answer to these problems,” he says. “A whole series of things have to be
done in a coordinated way.
“What Iain and his group are saying is that we have to stop thinking of these
things as problems that can be solved from the outside. They have to be
tackled from the inside; by community groups, charities and other bodies. We
have to move people from chaotic, dysfunctional lifestyles into the
mainstream.”
When Duncan Smith talks about his reports, he fires on all cylinders with a
passion that he struggled to achieve as Tory leader. He talks of children
whose life chances have already been blighted by the age of three, and of
the need to import some of the successful schemes to help disadvantaged
young children used successfully in America.
One he is keen on is the Olds’ Nurse-Family Partnership, in Baltimore, which
began 30 years ago and offers an intensive programme of home visits to
low-income first-time mothers. It has been shown to improve the health and
welfare of the children and prevent them from sliding into crime and
delinquency.
He says that although only a tiny proportion of young people go through care,
they account for a third of prisoners in later life. Brown’s U-turn on
supercasinos last week was, he believes, driven by his report, which Downing
Street intended to criticise until it discovered that it was hard to attack.
The most powerful unifying theme is that as a society, we need to work. Work
is the only sure way out of poverty, he says, and of restoring people’s
self-belief, and belief in society. Single mothers should go out to work
when their children reach five, not least to demonstrate to them that work
should be a way of life.
A striking feature of the reports is how 10 years of rising prosperity under
Labour has left the most serious problems of social breakdown and welfare
dependency untouched.
Before it was elected in 1997, the Labour party castigated the Tories for
their failure to provide enough jobs and, in particular, the problem of
“workless” households. “One in five families has no one working,” its 1997
manifesto said. It was a powerful slogan; emblematic of Conservative failure.
But now, despite years of rising employment and falling unemployment the
problem of workless households is still with us. In the spring of 1997, they
accounted for 18.1% of all households; now it is 15.8%. Britain, meanwhile,
has the highest proportion of children living in workless households – more
than 15% – in Europe.
Often if the husband is classified as long-term sick or disabled, there is no
financial gain, and sometimes a loss, if the wife goes out to work. Nearly
two in five – 39% – of working-age people in workless households say they
cannot work because of long-term sickness and disability.
The figures, taken at face value, suggest Britain is a remarkably unhealthy
society, with a higher proportion of working-age people with disabilities,
7.4%, than any other western country.
The numbers claiming disability living allowance (DLA), up 50% since 1997,
show huge regional variations; from 1.9% in Windsor to 12.8% in Merthyr
Tydfil.
“Some have suggested that DLA is being used selectively as a substitute for
unemployment benefit, rather than simply reflecting underlying differences
in health patterns,” the report says. It seems like a reasonable suggestion,
and it adds up to a depressing picture.
Incapacity benefit is a door through which people go and rarely return; 85%
have been on the benefit for over a year, and on average people stay on it
for between eight and 10 years. Worryingly, the average age of claimants is
getting younger.
“If you have been on incapacity benefit for more than two years, you are more
likely to retire or die than ever get another job,” said John Hut-ton, the
former work and pensions secretary.
Debbie Scott, chief executive of Tomorrow’s People, a charity that helps the
unemployed into work, co-chaired the economic dependency and worklessness
working group, which contributed one of the six reports published last week.
Her charity specialises in dealing with problem people, often those who turn
up at doctors’ surgeries seeking help. In many cases, the GPs’ diagnosis is
that what they need is a job to lift them out of depression.
A central idea, used successfully in Australia, is that charities and private
companies should become like head-hunters for executive jobs – getting paid
if they get the unemployed into jobs and make sure they stay there.
The Australian government set up the Job Network, private companies and
charities who get paid for finding people jobs and keeping them in them.
“People who are long-term unemployed have enormous problems,” she says. “They
want to work but they don’t know how to go about it, and they fear loss of
benefit.”
Often, such people have to be made ready for work by weaning them off their
drug and alcohol addictions. Even when they get into jobs, they are likely
to drift back into unemployment: 58% of those claiming job-seeker’s
allowance are returnees, experiencing a second, third or fourth bout of
joblessness.
“The job isn’t done when you get somebody into work,” she says. “You have to
keep working with them to make sure they stay there.”
The full Breakthrough Britain report can be read on the Centre for Social
Justice website: www.centreforsocialjustice.org.uk
Stepping in early to save children and their families is the key
The Social Justice Policy Group makes recommendations that include:
Tackling disadvantage early
Responding to the consequences of problems is harder than nipping them in the
bud. The underlying causes of deprivation, drug addiction, worklessness and
educational failure have to be tackled early, with the help of charities and
community groups.
Nurse-family partnerships should be used to stop children falling behind,
physically and mentally, in their first three years; a child’s educational
development at 22 months accurately predicts attainment at 26 years. US
evidence suggests that every dollar spent on early intervention brings a $17
return.
Front-loading some benefits
Parents from low-income households should be given additional benefits in
their child’s early years as a reward for entering nurse-family partnerships
and, in the case of lone parents, for going out to work when their child is
five. Parents of “at risk” children should get up to three times standard
child benefit – £2,800 a year for the early years.
Tackling educational disadvantage early
Children from poor families where there is parental commitment to learning
achieve more; 69% of Chinese boys from such families gain five or more good
GCSEs, compared with 17% and 19% from white and Caribbean families.
Improvements in preschool education and action to boost parental involvement
are needed.
Tacking Britain’s ‘unique’ record of family breakdown
A comparison by the Organisation for Economic Cooperation and Development
showed that for a one-earner married couple with two children, the marginal
effective tax rate can be 90%, compared with an OECD average of 54.7%.
Britain has one of the highest levels of family breakdown in Europe. Nearly
one in two cohabiting couples split up before their child’s fifth birthday,
compared with one in 12 married couples. Fiscal disincentives for married
and unmarried couples staying together, the “couple penalty”, should be
removed as an urgent first step.
Tax credits should be adjusted to give couples the same ratio of support as
lone parents. At present a couple on credits would have to work 116 hours a
week to get the same income as a lone parent working 16.
Direct tax help for married couples should be reintroduced. They should be
allowed to transfer their income tax allowances to their spouse if they are
not using them. This would provide a significant incentive for marriage.
Keeping couples together
A package of support for all families, including relationship and parenting
support and extra help for families coping with disabilities. Examples such
as the Wisconsin “Healthy Marriage” initiative, the Oklahoma Project and the
Bristol Community Family Trust show this action works. The aim should be to
reach 800,000 families a year and stop them breaking up.
Treating drug and alcohol abuse
Drug and alcohol abuse costs society £39 billion a year. Some 350,000 children
have drug-addicted parents; a million have alcohol-addicted parents.
The government spends £400m a year on drug treatment. To match Swedish and
Dutch success that needs to be more than doubled, paid for by a big increase
in alcohol taxes. Cannabis should be reclassified as a class B drug (from
class C) and new ways of treating addiction introduced; including abandoning
methadone treatment for heroin addicts.
