Abolishing the universal state pension – the new Westminster consensus?

Over the weekend, Ian Duncan Smith made widely reported comments that wealthy pensioners should be prepared to return some of their benefits – notably winter fuel payments and free bus passes.  This morning on the BBC Today programme, Labour DWP spokesman Liam Byrne (unsurprisingly) refused to defend the principle of universality. Nick Clegg and his party have for some time been advocating removing some benefits from wealthier pensioners.  It’s increasingly obvious that there is a Westminster consensus emerging.

It’s not difficult to see the attraction to policy-makers of a neoliberal bent.  It gives the impression of fairness, but also provides the opportunity to get to grip with the fact that spending on pensions and associated benefits represents a far greater proportion of DWP spending than the benefits for the poor (in or out of work) and the disabled that the Coalition has hitherto targeted.

But, as so often when our Westminster parties begin to coalesce around an idea, start picking at it and it falls apart. I’ve blogged before about the advantages of universal benefits – the way in which they are both more efficient and promote social cohesion – and Owen Jones has tackled the social cohesion arguments in a a characteristically powerful piece in the Independent.

But Duncan Smith’s comments raise some fundamental questions – just who are these wealthy pensioners? And how many of them are there?  The problem is that of conflating wealth and income.  There are many older people who have extremely low incomes – especially widows who have not worked or only worked intermittently, and whose tiny basic pension is topped up with pension credit – but who are sitting in houses that, thanks to long-term house price inflation, give the appearance of wealth. Are these people – likely to be hit hardest by rising fuel costs – to hand back their winter heating allowance?  And how on earth do you measure this wealth (as an aside, it’s quite amusing to see how many of the policy initiatives from the right involve the comprehensive post-Council Tax revaluation of property from which successive governments have shrunk in fear)? Everbody knows that the truly wealthy are expert at hiding their wealth, while the processes of deciding who is eligibility will almost inevitability  hit those whose apparent wealth is wholly unrelated to their income.

And there is a longer-term question.  One of the undoubted legacies of the Thatcher era was the belief that private pensions were the way to provide sustainably for old age; but as those who have started to draw pensions after the 2008 crash know to their huge cost, the vagaries of the market can decimate that provision.  The effect of relying on private provision is that old age is inherently less secure, less predictable, less stable.  Universal benefits have a hugely stabilising effect, especially when the market fails to provide.

One of the most dishonest pieces of Labour rhetoric is the claim that its approach to benefits aims to “restore the contributory principle”.  Of course the contributory principle is alive and well – all of us who earn pay National Insurance – and nowhere more so than for provision in old age; to claim otherwise is either dishonesty or gross intellectual confusion (and Liam Byrne’s daily pronouncements show that the two are by no means mutually exclusive).

All in all then, this looks like the Westminster parties lining up to end universal benefits in old age.  It’s not something they could ever propose openly – for a start everybody knows that older people are more likely to vote.  But then nobody proposed the privatisation of the NHS at the 2010 election.  It’s that insidious process of undermining something, dressing that undermining up as fairness and calling for a “debate” about long-term sustainability while making reassuring noises about things being off the agenda until after the next election.  And it’s worth recalling that many of the (in my view) most obnoxious elements of Coalition policy – workfare, outsourcing of health care, the promotion of academies, the privatisation of higher education, the use of ATOS to apply bogus science in the name of getting people off benefits – are really no more than New Labour policies taken to their logical conclusion.

Watch this space.  I predict that whatever the outcome of the 2015 election, the next Government will be looking to abolish the universal pension.  The time to start organising – and to start defending the universal principle is now; and there is no policy more dangerous than assuming that Labour in office will do the decent thing.

 

Ed Miliband’s tax break for living wage plan – an exercise in missing the point

Ed Miliband has proposed tax breaks to encourage employers to offer a living wage, according to reports in this morning’s Guardian.  Labour, it is argued, wants to reduce the benefits bill by encouraging employers to pay higher wages.  The shadow Treasury team is reported to be considering options.

The aims are laudible – better pay, a real multiplier effect (which somewhat contradicts Ed Balls’ austeritarian view of public finances, but we’ll leave that one aside for the moment), a boost to the economy and a smaller benefits bill.  Everyone would benefit – and there can be little doubt that lifting wage levels for the low-paid would both boost the economy and reduce the benefits bill.  We are clearly in virtuous circle territory, especially when one considers that real pay in the UK is falling – and falling faster than in any of the other top 10 world economies.

But the plan is deeply flawed – in ways that are revealing about Labour’s economic mindset. The obvious objection is that, as with any proposal that tops up low wages, it effectively subsidises employers for doing the right thing.  It’s a bit like reducing VED for drivers who obey the speed limit.  And it ignores the fact that even firms employing staff at less than the living wage will still employ staff who are paid more than it – who are indeed paid well.  How do you define both the level of, and the criteria for receipt of, the tax break, in such as way as to ensure that businesses do not receive subsidies for simply paying their staff what the market will take?  And as soon as you find yourself offering tax breaks to business that are significantly in competition with others elsewhere in the EU, how do you stop this from turning into an illegal State Aid?  And what of the cost of administering all of this, and assessing who is eligible for the tax break?

You do not have to dig too far below the surface to find that this proposal unworkable. The discipline of turning a bright idea into a workable legislative proposal is cruelly exposing (and I speak as someone who in my Civil Service days had plenty of experience of developing Finance Bill legislation).  Like so many ideas that form part of Labour’s “predistribution” package, the whole structure starts to fall apart once you start to ask the awkward questions that turning policy into workable practice must beg.

More significantly, it exposes a long-term issue for wages and working conditions.  The number of people working in the public sector has fallen substantially, not least through outsourcing, and is expected to continue to fall substantially.  The largest employer in the UK – the NHS – has just effectively been privatised, which will mean that the number will fall considerably further as many NHS functions are transferred to the private sector.  Previously, the public sector has been a benchmark for decent pay and conditions – including of course pensions.  Decent pay and conditions in the public sector has driven standards of pay in the private sector as employers compete for staff – which is of course one of the reasons why the right wants to reduce it in size, because its shrinkage is a factor driving falls in pay (along with an explicit policy of reducing public sector pay in real terms).  Moreover, a large public sector payroll has an inherently stabilising effect on economies.

But with an incoming Labour government committed to keeping the Coalition’s cuts and possibly making more of its own, that trend will continue; and in it adherence to austerity economics Labour is actually throwing away the best tool it has to bid up real wages; an expanding, dynamic and decently-paid public sector.

Obviously simply expanding the public sector won’t do the trick on its own.  It needs the courage to argue for decent public sector pay as a good thing, when public sector pay and pensions have always been an easy targets for Blairites as well as Condems.  And it does need supply-side adjustments – better education, better training, career development (all of which come at a price and might be a better target for tax breaks – it remains the case that a firm pays VAT when it sends an employee on a training course but a public school education is VAT-free and heavily subsidised) and a mentality that sees labour flexibility as a managed process of improvement rather than a driver of low pay.

The trouble for Ed Miliband is that dealing low pay in a coherent and intelligent way means dragging Labour off the neoliberal yellow brick road. And that appears as far away as ever.

Welfare and vouchers: the Right’s denial of citizenship attack

There’s an excellent piece by Zoe Williams in today’s Guardian in which she describes the impact of the decision that crisis loans – now administered by local authorities – will be paid by vouchers or card; or in some cases will be given straight to a foodbank charity.  Williams is right to point out that a line has been crossed; that even though this scheme represents a minuscule element of total welfare spending, the belief that benefits should be paid effectively in kind rather than in cash is an important one.  It represents the triumph of an ideology – one that I have blogged about before – that seeks to deprive the poor of full citizenship, and to make citizenship instead dependent on income.

Neoliberalism is an ideology that places choice at its heart.  It is founded on the idea that freedom is based on the ability to make choices; thus to deny people choice about how they spend is, in the Right’s own terms, to turn those people into second-class citizens. I blogged a few days ago about how workfare is the workhouse of the twenty-first century; the mentality behind this voucher system is identical.  You are poor; you have therefore sinned.  You do not have the rights of the virtuous, and you are not deserving.  The humiliation of presenting your card or voucher at the checkout is to steel your character.

And, as Williams mentions, this is all of the piece with the lie of the poor living a life of ease in front of the Sky box and the flat-screen TV; a lie, and one that is fully in the worst traditions of the nastiest propaganda of the twentieth-century, but an essential one in order to ensure that those hit by austerity continue to back it at the ballot box, and one that is legitimised every time a politician from anyhwere in our (appallingly narrow) mainstream polity referes to “hard working families.”

Williams mentions cost, and notes in passing that the original Demos report advocating a welfare card system was sponsored by Mastercard; but does not quite draw the obvious conclusion, that this system will be a milch-cow for the private sector.  The point about cash is that it is free; it does not bring with it specific administration costs other than those – like the costs of minting coins and printing notes, and of handling cash – that are spread across all transactions.  Card transactions bring costs; not least to the merchant.  Who will bear the costs of these cards? The retailers, as in the case of credit and debit card transactions? Taxpayers? Or will there be a service charge added to the items that those on emergency loans buy, adding to the burden that poor people already face in paying more for services? The reason why the railways cost more in public subsidy for a worse service, and why healthcare on the US model is more expensive than the NHS model that will in a few days be abandoned is because of the administration and transaction costs between private entities in a world that is regulated by private contracts. Why would a Government that claims to be motivated by reducing costs create a system of benefit payments that is inherently more expensive?  The answer, quite obviously, is ideology.

It is a reminder that the return to the nineteenth-century vocabulary of pauperism and desert is almost complete. And I make one prediction – that you will not hear a syllable of complaint about this scheme from Liam Byrne and One Nation Labour, because the return to that vocabulary is in the warp and weft of the Westminster ideological consensus.

How to fight neoliberals: The New Zealand experiment revisited

The people behind the Think Left blog yesterday circulated a piece from the Independent about the way in which New Zealand has reacted to the imposition of an austerity agenda.  It’s an old piece, but the landscape is strikingly familiar – food banks, homelessness, benefit cuts, soaring crime.  The piece points out how New Zealand’s progressive traditions have been traduced.  The first country to give women the vote, the first country to introduce universal benefits, once held up by Aneurin Bevan as a model for the future.  Up until recently, if you wanted to sum up the New Zealand ethos in one phrase, it was the “Fair Go” – the belief that everyone had the right to share in the good things in society and make the best for themselves and their families.  Now, if you hear it at all, it’s likely to be a shallow justification for deregulating business.

The piece had me reaching for Jane Kelsey’s magnificent book on the neoliberal takeover of New Zealand, The New Zealand Experiment.  Not an easy book to find in the UK, I bought my copy in New Zealand back in the 1990s; it remains a vital and urgent book, because its themes resonate so powerfully with our experience of austerity in post-2010 Britain.

Two of Kelsey’s themes strike home particularly hard.  First, the use of crisis to undermine democracy.  Kelsey points out that neoliberalism does not win elections; crisis must be used to create the illusion of necessity and to invalidate alternatives.  She describes the proponents of neoliberalism as “technopols”, an uncanny prescience of the imposition of “technocratic” Governments in Greece and Italy to drive neoliberal reforms.  The spectacle of European governments lining up to join a neoliberal treaty that would effectively outlaw expansionary economic policy, the creation of secret trade agreements in which corporate tribunals will be empowered to overrule democratic governments, or the construction of the lie that austerity economics is the necessary antidote to profligate public spending; Kelsey foresaw all these.

Second, Kelsey points to the complicity of avowedly left-of-centre parties in bringing about the neoliberal coup.  Economic reform was instituted by a Labour government in New Zealand, and was generally known as “Rogernomics” after the then Labour finance minister, Roger Douglas.  Once again it’s a powerful reminder that, years later, British austerity economics was imposed because an apparently left-of-centre party was prepared to put into office a Conservative Party that had just failed to win an election (the Liberal Democrats being, of course, an example of a party that, having been captured for Neoliberalism by its Orange Book faction, sought to present a soft centrist image to the electorate).  But it’s also important to remember that many of the salient features of British austerity had their roots in Labour’s years in office.  NHS outsourcing, the introduction of private capital into education, workfare, university tuition fees, cutting benefits, asset sales; all of these are core Labour policies that the Coalition has simply taken to their logical conclusion.  Labour is committed to keeping the Coalition’s public spending cuts and considering more of its own; it offers no alternative to the austerity agenda.  It differs from the Coalition in degree and presentation rather than substance; Westminster remains a place of neoliberal consensus.

These are not of themselves startling insights in 2013 (although the prescience of a book written in 1994 is startling). What makes Kelsey’s book really compelling twenty years on is a four-page appendix entitled A Manual for Counter-Technopols.  It sets out a checklist of strategies for resistance: it seems to me to be just as important and apposite now as when it was written.

It’s obviously written from a New Zealand perspective, and recognises that in New Zealand in the 1990s, as in Britain and Europe in the 2010s, much of the pass had already been sold.  But the important thing is the conceptual framework, and the pointers it gives towards developing an effective critique of neoliberalism – especially when faced with parties of the centre-left that have thrown in the towel, but also perhaps to more radical groupings who find themselves going native once they’ve arrived in political office.

A quick Google search suggests that although excerpts have been reproduced on line, nobody has done so in its entirety.  So here it is: it’s a formidable piece of work.

Appendix: A Manual for Counter-technopols

If the architects of structural adjustment are pooling their experiences in a manual for technopols to help them impose their agenda on the rest of the world, those who want to stop them should do the same. A preliminary checklist of potential pitfalls and strategies for resistance, drawn from New Zealand’s experience, might include the following:

- Take economic fundamentalism seriously – what initially appears like extremism, if not effectively challenged and discredited, may in a short time be considered orthodox.

- Nip it in the bud – early changes can be the most fundamental and deliberately difficult to undo; once the structural adjustment agenda is under way, its internal logic has a domino effect on all policies and programmes.

- Be sceptical about ‘crises’ – anticipate a ‘crisis’ in the making, and move quickly to examine the real nature of the problem, who defines it as a crisis, and who stands to gain. Demand to know the range of possible solutions, and the costs and benefits of each to whom. If the answers are not forthcoming, burn the midnight oil to produce the answers for yourselves.

- Watch for the blitzkrieg  - constantly monitor, document and expose what is going on behind the scenes. Act on instinct and anticipate the logical next step. Waitng until all the facts can be documented will probably be too late.

- Remember the Tories are not always the worst – social democratic parties  and governments can neutralise potential opponents and initiate vital changes which provide the thin end of the wedge. Fighting to prevent  a party’s capture by zealots is important. But once the party has been taken over, maintaining solidarity on the outside while seeking change from within merely gives them more time. When the spirit of the party is dead, shed the old skin and create something new

- Take economics seriously – economic fundamentalism pervades everything.  There is no boundary between economic, indigenous, social, foreign, environmental or other policies. Those who focus on narrow sectoral concern and ignore the pervasive economic agenda will lose their own battles and weaken the collective ability to resist. Leaving economics to economists is fatal.

- Expose the illogic of their theory - neo-liberal theories are riddled with bogus assumptions and internal inconsistencies, and often lack empirical support. Agency and public choice theories in particular need to exposed as self-serving rationalisations which operate in the interests of elites whom the policies empower.

- Evaluate the argument carefully – acknowledge the valid aspects of arguments for change and meet them with alternatives which address the substance of the concern.

- Challenge hypocrisy – ask who is promoting a strategy as being in the ‘national interest’, and who stands to benefit most. Document cases where self-interest is disguised as public good.

- Expose ‘stacking of the deck’ – name the key players behind the scenes, document their interlocking roles and allegiances, and expose the personal and corporate benefits they receive.

- Maximise every political obstacle – federal systems of government, written constitutions, bicameral parliaments, complex voting systems, supra-national institutions and strong local governments provide barriers which can neutralise the blitzkrieg approach and slow the pace of, if not prevent, undesirable change.

- Maintain a strong civil society and popular sector – extra-parliamentary politics are essential to complement resistance through traditional party channels, and may become the front line once institutional politics fall captive.

- Work hard to maintain solidarity – avoid the trap of divide and rule; sectoral in-fighting is self-indulgent and everyone risks losing in the end.

- Do not compromise the labour movement – build awareness of the structural adjustment agenda at union branch and workplace level, so union members can demand accountability from their leadership. Openly debate the pros and cons of political party ties, and the costs and benefits of compromise. Concessions intended to forestall more radical change tend to deepen co-option and weaken the ability to resist the next step. Publicly challenge the failure of union bureaucrats to defend the interests of workers and the unemployed. If the leadership doesn’t listen, disobey.

- Employ the politics of international embarrassment – if the forums of institutional politics have been taken and local resistance neutralised, marginalised or suppressed, the most potent political arena may be the inremational stage. Neo-liberal governments and free market economies depend on foreign investment and international approval. Image is everything. The international sphere is one arena they cannot effectively control.

- Reinforce the concept of an independent public service – undercut attempts to discredit, sideline and colonise the public service by acknowledging deficiencies and promoting pro-active models for change. Create a constituency of support among client groups and the public which stresses the need for independence and professionalism, the obligations of public service, and the risks of the managerial approach

- Encourage community leaders to speak out - public criticism from civic and church leaders, folk heroes and other prominent ‘names’ makes governments uncomfortable and people think. The fewer public critics there are, the easier they are to discredit, harass and intimidate. Remind community leaders of their social Obligations, and the need to look themselves in the mirror in the morning.

- Avoid anti-intellectualism – a pool of critical academics and other intellectuals who can document and expose the fallacies and failures of a structural adjustment programme, and develop viable alternatives in partnership with community and sectoral groups, is absolutely vital. They need to be supported when they come under attack, and challenged when they fail to speak out or are co-opted or seduced.

- Establish well-resourced critical think-tanks – neo-liberal and libertarian think-tanks have shown the importance of Well-resourced and internationally connected institutes which can develop an integrated analysis and foster climates favourable to change. Unco-ordinated research by isolated critics can never compete.

- Develop alternative media outlets – once mainstream media are captured it is difficult for critics to enter the debate, and impossible to lead it. Alternative media and innovative strategies must be in place before people and financial resources come under stress. Effective communication and exchange of information between sectoral groups and activists are essential, despite the time and resources involved.

- Raise the level of popular economic literacy – familiarise people with the basic themes, assumptions and goals of economic fundamentalism. Insist that economic policy affects everyone, that everyone has a right to participate in the debate, and that alternatives do exist.

- Educate popular and sectoral groups in advance – draw on international experience, networks, publications, speakers and examples to put people on the alert. Identify the likely strategies, policies and effects of structural adjustment for sectors like labour, education, health, local government, community work, public service and the media. Encourage sectors to workshop counter-strategies in advance. There will be little time for this when people are struggling just to survive.

- Resist marketspeak – maintain control of the language, challenge its capture, and refuse to convert your discourse to theirs. Insist on using hard terms that convey the hard realities of what is going on.

- Be realistic and avoid nostalgia—recognise that the world has changed, in some ways irreversibly, and the past was far from perfect. Avoid being trapped solely into reaction and critique. Many neo-liberal criticisms of the status quo are justified and will strike a chord with people. Defending the past for its own sake adds credibility to their arguments and wastes opportunities to work for genuine change.

- Be proactive and develop real altematives – start rethinking visions, strategies and models of development for the future. Show that there are workable, preferable alternatives from the start. This becomes progressively more difficult once the programme takes hold.

- Rethink identity and alliances – combine a critical analysis of economic, political, cultural and social models of the past with a forward-thinking vision of what a socially just future might look like. Recognise that the legitimate expectations, insights and vision of indigenous peoples are no just a matter of social justice, but offer the foundation for an alliance which can forge a new way ahead.

It is impossible to tell in retrospect how far these strategies would have hindered, let alone prevented, the onset of economic fundamentalism inNew Zealand. They most certainly would have made the ‘successful’ implementation of the structural adjustment programme more difficult, and given time for opponents to rethink, regroup and resist

Sadly, the time for many of these strategies has passed. It is going to be enormously difficult and costly to bring about changes which genuinely empower people in Aotearoa New Zealand to take control of their lives, within communities where they can play an active, equal and valued part. Yet the potential is still there for alternative forms of economics, politics and identity to emerge, and there are strategies which can exploit the soft underbelly of the new regime to bring them into effect. The beginnings of a manual for counter-technopols in this post-structural adjustment phase might include the following:

- Challenge the TINA svndrome – convince people individually and collectively that there are alternatives. Carefully analyse present barriers and future trends to produce options that combine realism with the prospect of meaningful change. Actively promote them and have them ready to be implemented when the market fails.

- Promote informed debate and critique – build a constituency for change through alternative information networks and media; use tribal, community, workplace, women’s, church, creche, union and similar outlets, and harness technology where available, to balance the good-news machine with critical analysis of the economic and social costs.

- Promote participatory democracy – encourage people to take back control; empower them with knowledge to understand the forces affecting them and the points at which they can intervene. Stress that no one has a fail-safe recipe for change, and that everyone has a contribution to make. Recognise the skills, resources and insights of tribes, individuals, communities, sectoral groups and civil society, and the right to act both separately and in concert.

- Embrace the Treaty of Waitangi as a liberating force—moving forward means facing up to the past. Healing the wounds from over 155 years means restoring to Maori their economic and political power. Constructive debate on a treaty-based republican constitution can provide a liberating framework within which Maori and Pakeha can co-exist.

- Encourage progressive counter-nationalism – celebrate diversity rather than uniformity; Work to build identities and values which replace xenophobia, racism and nostalgia with multiple identities and progressive visions for the future.

- Develop multi-level strategies – take action at local, sectoral, regional, national and international levels, and co-ordinate those activities through informal networks and formal linkages.

- Hold the line – the structural adjustment programme is not yet complete; the state still plays an active role in providing social services and public goods. Sustained and co-ordinated action in communities, sectors and national politics can effectively hold the line.

- Localise politics – recognise the power held by regional and local authorities and the ability to secure information and influence decisions at that level. Encourage accountability of local officials and participation in local politics. Continue local struggles to maintain services which provide for local needs; build solidarity, political awareness and a belief in the possibility of change.

- Ginger up party politics – maintain pressure on political parties through popular mobilisation and public education campaigns, document failed policies and unacceptable practices, and use the politics of embarrassment at home and overseas to complement the work of party activists within.

- Invest in the future – provide financial, human and moral support to sustain alternative analysis, publications, think-tanks, training programmes and people‘s projects that are working actively for change. Create alternatives to state dependency by providing financial, personal and moral support for alternative economic developments.

- Support those who speak out – intimidation and harassment of social critics works only if the targets lack personal, popular and institutional support. Withdrawing from public debate leaves those who remain more exposed.

- Promote ethical investment – support overseas and local investors who genuinely respond to indigenous, ecological and social concerns. Expose and attack unethical investors who don’t. Boycotts have proved a powerful force internationally and in New Zealand, including anti-apartheid, anti-nuclear, environmental and safe product campaigns. ‘New Zealand’ companies can be most easily embarrassed and called to account. ‘Foreign’ companies are often targets of co-ordinated campaigns overseas that welcome information, participation and support.

- Think global, act local – develop an understanding of the global nature of economic, political and cultural power, and those forces which drive current trends. Draw the links between global forces and local events. Target local representatives, meetings and activities which feed into and on the global economic and political machine.

- Think local, act global – actively support intemational strategies for change such as people’s tribunals, non-state codes of conduct, non-governmental forums, and action campaigns against unethical companies, practices and governments. Recognise that international action is essential to counter the collaboration of states and corporations, and to empower civil society to take back control.

The pseudo-science behind the political war on the disabled

It has been a bad week for those on benefits, with George Osborne announcing in his Autumn Statement that benefits will be uprated by less than inflation – in other words, cut in real terms.  Labour is promising to fight these cuts but the pronouncements of both Labour DWP spokesman Liam Byrne and Labour leader Ed Miliband do not exactly fill one with optimism.

People with disabilities have been in the forefront of the attack, and that attack has been reinforced by a narrative that unites all the mainstream players in Westminster politics.  If the cruelty and destructiveness of Coalition policy on benefits is to be exposed and combatted, it is essential that the story is understood.

There’s a detailed and referenced account of that narrative on the Disabled People Against Cuts website.  In summary, the piece indicates how the current approach, using a bio-psychosocial model of disability, is flawed and unsupported by evidence, but, encouraged by private sector organisations that see the potential for profit in carrying out bio-psychosocial assessments of those claiming benefits, has become a de facto orthodoxy.

The authors point out that the approach to disability has shifted from a social approach – one that emphasises to environment and context and sees society’s response to disability as the issue to be addressed – to a so-called bio-psychosocial approach that focuses on the individual and their reaction to the environment.  As the piece points out, it is an approach that can have value in dealing with individuals. But it’s all too obvious how such an approach can be picked up and abused by neoliberals.

Put briefly, the root of the ideological justification comes from the American sociologist Talcott Parsons’ concept of the sick role, which argues that sickness is in essence a form of social deviance, which needs to be policed by medical and other professions.  This is associated with the idea that work is essential to well-being (which is true in the sense that those denied the opportunity for meaningful work suffer mental and physical symptoms); it becomes very easy for neoliberals to conflate these into a doctrine in which you can argue that denying disabled people the ability to live without work is therapeutic (you can also use it to justify the idea of workfare in which benefits are contingent on unpaid work), and of course fits well with populist narratives of workshyness and scrounging.  The scarcity of meaningful jobs in long-term economic depression is not considered by this model).

Into this environment march private companies like ATOS and Unum, with experience of developing assessment regimes with a simple aim – that of reducing the number of people on benefits.  And add to this the recruitment of amateurs like banker Lord Freud, recruited to advise Gordon Brown on benefit reforms and now a Minister in David Cameron’s government; the potential for these companies to present a ready-made pseudo-scientific model to politicians and advisers in need of a quick result; and you have the current mess.  A policy that is obviously failing, but which has the appearance of scientific credibility and which flatters the ideological preconceptions and prejudices of those in power.  It is a subsititution of privately-generated pseudo-evidence – flatpack policy-making, as it were – for real evidence that is all too familiar to observers of how this coalition government conducts itself.

And as the authors of the DPAC piece make clear – this is pseudo-science, in which the work of the academics whose work underpinned the bio-psychosocial model has been misrepresented and distorted for profit by organizations who provide a convenient and potentially popular post-hoc rationalisation for what is the central policy goal – to reduce the amount paid in benefits to the disabled.  Political and media rhetoric, playing to the fears and prejudices of the ignorant, has done an astonishing job of destroying compassion and empathy in modern Britain, but one suspects that even for Tories and Liberal Democrats, stating openly that you want to cut the living standards of the disabled is a step too far.  It is one of the defining characteristics of the neoliberal project that it needs to subvert democracy, because open neoliberalism does not win elections; pseudo-science, like pseudo-economics, is what allows neoliberals to bridge that gap. And it allows the devaluaing of conflicting “expert” opinion.

The point about all of this is that none of it is surprising.  The devaluation of evidence is at the heart of coalition policy; evidence-based policy making is subordinate to ideology and profit.  But the point here is that this is not just a coalition policy; this kind of thinking was becoming mainstream under Labour government and underpinned Labour policy.  It quite obviously informs every pronouncement of Labour’s DWP spokesman Liam Byrne.  And it is one reason why I, for one, am deeply sceptical of Labour’s apparent change of heart on benefits – because I see no evidence that Labour’s underlying rationality has changed.

Is Cameron’s plan to tag offenders by GPS credible?

One of the most eye-catching aspects of David Cameron’s speech on criminal justice yesterday was the suggestion that GPS technology could be used to track offenders.  As someone who, during his time as a Civil Servant was actively involved in advising on the use of GPS technologies and has quite a bit of experience in the field I found myself unconvinced by aspects of  this proposal.  I’m not convinced that it is workable – yet – and I wonder whether No 10 has really sought good technical advice on this.

Politicians and the media in Britain do not, as a whole, exhibit a great degree of scientific or technical literacy. It means they are easily suckered by people selling technical solutions that give the appearance of being plausible; a lot of people in Whitehall spend quite a lot of their time telling Ministers that  the latest technical wheeze being offered by manufacturers, however impressive it may look in a small-scale trial,  is unsupported by any real evidence that it could be rolled out on a large scale in the messy real world

GPS is a  mature technology that has a huge range of real-world applications. Obviously it’s crucial to navigation systems but most smartphones contain a GPS chip, as do all ATMs (for date and time stamping rather than navigation).  The signs at bus stops telling you that the next 5A will arrive in 5 minutes use GPS technology.  But many commentators show themselves to be clearly clueless about how it works – witness this rather glorious piece of bad science from the Daily Telegraph following yesterday’s announcement. Put at its simplest, satellites do not track and cannot track anyone or anything; the same fallacy dominated the public debate over road pricing launched by the last Labour government.  Within Whitehall, Ministers and Special Advisers are notoriously susceptible to this kind of nonsense. A report in the Guardian today tends to confirm the suspicion that the work behind Cameron’s speech is worryingly light on evidence.

GPS works by taking location fixes from satellites.  It requires a clear sky view of at least three satellites to do this.  In order to track an offender, you would need to generate a series of such fixes, and  pass that information to the control centre.  Obviously, the more detailed the tracking, the more data you would need to store on the tag and the more frequently you would need to relay that information to the control centre.  And of course the tag would need a power source; GPS applications are notoriously battery-draining and the tag would need frequent charging.

Now obviously there is nothing here that couldn’t be done.  The most technically problematic part is generating fixes; GPS is notoriously susceptible to difficulties in streets with tall buildings, or where plate glass or water causes reflections and hence the possibility for false signals.  Now in the real world you can get round this either by map-matching (i.e. snapping the reads to digital mapping data stored in the tag) or simply discounting the odd outlying fix and using algorithms to approximate the missing data.  But in a world in which you are seeking to establish a criminal burden of proof, how far can you do this?  Equipment like safety cameras requires rigorous levels of type-approval before its output is admissible in court.  What level of locational accuracy would be required to sustain a prosecution of an offender who had broken the terms, say, of his bail?  And how much would it cost to produce a type-approved product that could demonstrate that an offender was in a particular place at a given time, beyond reasonable doubt?  Would you need corroborating evidence from eyewitnesses or cameras?

GPS does not work underground (obviously). Would London offenders be barred from using the Tube (which could be pretty counter-productive if one object of the scheme is to allow offenders to get back into jobs)?

And GPS can be spoofed, relatively cheaply and easily. How much security would be built into an offender tagging system? At what cost?

And what about data transfer?  How do you get data from the tag to the control room? The obvious answer is through mobile telephony, but to claim that you can pinpoint where an offender is at any given time requires real-time updating, and if tagging is to operate on any kind of scale you need to either transfer huge quantities of data in real time – and that can become seriously expensive (especially compared with the option of storing the information on the tag – memory is becoming very cheap – and transferring the data en masse when the networks are quiet).

In theory, there is nothing here that could not be overcome.  But it comes with a price-tag and there is the world of difference between running a successful pilot scheme and delivering something that is robust and cost-effective in the real world.  And – given that evidenced policy-making has not so far been the coalition’s strong point, I wonder just how far Special Advisers – for whom evidence is often the word of the last industry lobbyist who has bent their ear – are pushing this plan beyond its evidential base, and are relying on sales pitches from the private sector instead. I’d guess there are plenty of private sector providers who are very keen to get their foot in the door to get what could be some very lucrative contracts, and who are confident that they could lay off the risks on to the public sector.

It’s important, because in this case tagging seems to be the quid pro quo for moving towards a justice system which is based on rehabilitation.  I would argue for an approach based on rehabilitation and restorative justice; all the evidence I am aware of suggests that it is far more effective and way cheaper than prison, especially for less serious offences. But  I am concerned that a glib throwaway remark from a Prime Minister playing that old political trick of appearing to be tough on crime when things are not going well could lead to an expensive disaster, which could end up being used to discredit a move away from custodial sentencing.  And I have no confidence that either politicians or the media will give the idea of tagging the scrutiny it needs, or indeed that they are remotely capable of conducting a nuanced and evidenced debate around a really difficult issue.

Privatising the roads

The news that the Department of Transport is to study the feasability of privatising the running of the trunk roads network is hardly surprising.  It’s been a gleam in the eye of the neoliberal Right for a long time – and it’s not difficult to see its superficial attraction for those of a neoliberal view.  The promise of a modernised network, with fast clear roads offering a pleasant motoring experience and reliable journey times, ticks all sorts of Tory boxes.  But it is – as with so many Tory/Orange Book projects – fraught with contradictions.

Some of these can be seen by travelling along the M6 Toll.  It’s a clear, free-moving and often empty road, allowing motorists to eat up the miles.  One thing you probably won’t see is a truck – the tolls are priced to keep trucks off the road, which is not surprising since nearly all the wear and tear on roads is caused by goods vehicles (essentially, what wears roads out is the weight on vehicle axles, and road wear increases to the power of four as that weight increases.  It’s why lorries do the real damage to trunk roads and why the cult of the suburban 4×4 is in the process of smashing local roads – obviously built to a much lower standards than motorways at a time when there was far less traffic – to smithereens).  You’re paying a toll, of course – for the most part stopping at toll plazas to do so, although regular users can get a tag.  And then you rejoin the heavy traffic on the main M6, with its rows of trucks.  You have enjoyed a luxurious alternative – one provided by the private sector and one over which the Secretary of State, i.e. our elected representative, has almost no control.  As with any other private infrastructure project, it’s almost certain there’s a change of law clause in the concession agreement – if the law changes in a way that changes the terms on which M6 Toll conducts its business, the taxpayer pays.  I obviously don’t know what’s in the M6 Toll concession agreement, but that’s how big private sector projects work; the taxpayer always carries the risk.

So what does this mean for a part-privatised national network?

The model that appears to be in the Government’s mind is Nicholas Ridley’s privatisation of the water network in the late 1980s which, it is argued, brought vast quantities of much-needed investment into the water industry.  But there has to be a question of whether that investment needed the private sector.  Governments can make investment; there’s a pretty powerful case for saying water needed more than the private sector has provided.  What of course is obvious is that the private sector may take spending off the Government balance sheet but there’s a price – the handing over of strategic (some would say democratic) control.  Part-privatisation represents in theory an acceptance that Government no longer has any strategic or policy interest in directing roads policy, or, as is more likely to be the case, that strategic decisions taken in the public interest must be paid for in hard cash.  The one-off income from the letting of concessions is quite likely to be offset by later expenditure to, in effect, buy the right to make policy decisions.  Add to that the costs of running a regulatory system and the fact that the network will be fragmented among private sector providers and you have all the makings of a hugely expensive, politically-atrophied mess.

Some other considerations.  New roads (and improvements) may be funded through tolls.  The Government seems to be hinting that road providers will be entitled to a cut of Vehicle Excise Duty, but that is a red herring as it will not provide a revenue stream of any significance.  VED raises about £4bn per year and only represents a very small part of total tax take from road users; it hasn’t paid for the road network since 1937; it cannot begin to provide the sort of revenue stream that would interest a private sector entity to run roads. It is the revenue stream that currently goes to the Highways Agency, and above all income from new infrastructure, that will attract the private sector.  So in effect the pass on roads policy will have been sold; all the incentives will be for the building of new roads, while maintaining the existing, less profitable stock, at the lowest possible cost – and with a strong disincentive to provide for freight traffic, which wears out the roads.  It’s the return of predict and provide with a vengeance, except that the “predict” part will be about corporate profit rather than any concept (however flawed that might be) of public need.  Moreover, if tolling is permitted for upgraded as well as new infrastructure, there is a risk that tolling will be far more widespread than the Government is willing to admit.  It is difficult to see the Treasury (who, rather than the DfT, will be driving the work on this issue, regardless of which Department’s name appears on the report) conceding the principle that motoring taxes should be offset as a result; from a Government which has generated much cheap rhetoric about Labour’s “war on the motorist” it’s a curious policy development.

Crucially, even limited tolling on the network could have huge implications for motorists everywhere.  One obvious issue is diversion – people avoiding tolls by going on to local roads.  It’s difficult to assess how great the impact could be – but of course a pricing structure delivered by the private sector is unlikely to have any need to take account of this externality.  More interesting is the question of free-flow tolling; if you are to avoid long queues at toll plazas you must have free-flow electronic tolling – the most likely method being the issuing of electronic DSRC tags to be placed in the vehicle windscreen, which register with a roadside beacon and allow toll-road usage to be charged to an account.  Vast numbers of people use the motorways on an occasional basis – unless you are to have huge queues at toll plazas you will need to have an infrastructure to manage accounts and enforcement.  None of this technology is new – but it is potentially seriously expensive and will involve what many private motorists regard as real inconvenience.  And they need to be interoperable – a system in which motorists need either to use a number of tags or pay at a number of toll plazas is just not going to be acceptable (people may cite the French motorway network, but the density of traffic is far greater in the UK).

Moreover, EU law requires that such systems are interoperable across Europe, and that it is possible to access all significant toll systems with a single tag and account – which means, for example, that lorries who are signed up to the German system must be able to use their account and on-board unit to pay for their use of a British tolled road.  It’s called the European Electronic Tolling Service, or EETS for short, and it’s an obscure piece of legislation that we may be about to hear a lot more of. The logistical issues – and inevitable costs – of this system will provide some of the Department for Transport’s bigger headaches in preparing its feasibility study.  Does a Tory-led coalition really want to be responsible for requiring millions of motorists who want to use the motorway network to carry a piece of electronic equipment in their car which, however erroneously, will be portrayed by the taboid media as a spy in the car?

And here is one of the major flaws in the scheme.  The coalition wants to portray itself as the motorist’s friend.  Moreover, it used to be standing joke in transport circles that, while the Anglican church used to be the Tory Party at prayer, the road haulage industry – represented by its powerful trade bodies the Road Haulage Association and the Freight Transport Association – was the Tory Party at work.  The AA Foundation has already shown its opposition to the proposals.  The FTA and RHA will not countenance a proposal that imposes costs on their members (and ultimately, since almost every item we buy will have spent some time in the back of a lorry, on all of us).

How far is this Government prepared to go to alienate its electoral base in order to generate more wealth for its friends in big finance? NHS policy suggests that the hold of big finance on the coalition is so great that even Liberal Democrats facing electoral oblivion will cheerfully vote for the NHS Bill.  I suppose the decisive question may be who matters more to the Tory Party – the hospital patient or the motorist.

Abusing Beveridge’s legacy

According to the Daily Mail (NB clicking on that link will contribute to the Mail’s advertising revenues), Ed Miliband and Liam Byrne are about to launch an attack on the “evil” of benefit scroungers.  The Left blogosphere and Twitterati have been driven into overdrive by this; some condemning the way in which an alleged party of the Left bows to cheap populism and lets Tories and their papers drive their agenda; and Labour loyalists trying to dissemble.  My own view is that a political system in which politicians jockey for votes by demonising the poorest and most vulnerable in society is badly broken, and those politicians who do so are beyond condemnation; it’s cheap, cowardly and even New Labour should know better.

However, one of the stranger aspects of the whole business is that Liam Byrne makes these comments in the context of a forthcoming lecture on William Beveridge, and tries to portray himself as Beveridge’s legitimate heir.  It’s an interesting parallel to Nick Clegg trying to do the same in front of the Liberal Democrat conference last March.

It’s strange because Beveridge was a powerful advocate of universal benefits. And, following Beveridge, there are two types of  arguments; the practical and the political.

First, the practical – obviously if a benefit is universal it cannot be claimed fraudulently.  The moment you means test a benefit you have to set up an apparatus to evaluate claims, process paperwork, manage changes in circumstances, enforce against abuse (the last of which turns the state into enforcer where it should be enabler).  Universal benefits are cheap to administer, fair and in principle free of abuse.  Indeed the very act of means-testing introduces abuse into the system – abuse happens because people try to beat the rules and the suggestion that you can exclude abuse by tinkering with those rules is asinine.  More seriously – since there is little hard evidence of deliberate abuse – you introduce the risk of mistakes in the system, and you raise barriers that make it more difficult for people to claim their entitlement.  That is the position in Britain, where the amounts of benefit that go unclaimed are vastly greater than the amount of fraud.

Second, there is a serious political point about how universal benefits emphasise what one is entitled to as a citizen – the citizen is not a supplicant, and although some of those benefits may go to the middle classes who do not, in the strictest sense, need them they help make society more cohesive and ensure that those who depend on those benefits are not stigmatised.  It emphasises that we are, to coin a phrase, all in it together.  It is about society establishing that everyone is entitled to a decent minimum as a matter of right.

Where would Beveridge stand today? It’s worth remembering that for Beveridge, enforced idleness was a terrible social evil.  The level of mass unemployment among young people in particular under the Con Dems would have horrified him; the idea that mass unemployment was a price worth paying for clearing a deficit caused by the fecklessness of the bankers would have repelled Beveridge’s old-fashioned sense of morality and probity. And he saw a National Health Service as an absolute condition of a decent society.

The narrative of benefit scroungers is an ideological myth. Yes, there is undoubtedly abuse, but compared with the £16 billion of unclaimed benefit each year and the squalor and despair of mass unemployment, it is minor.  If Labour was a decent party, true to its roots in Trade Unionism, in Christian socialism and Fabian improvement, and retained a shred of the decency and compassion that drove its founders, it would have the moral courage to stand up to the myth and debunk it.  As R H Tawney wrote in his great essay on the choices before the Labour Party following the split of 1931, “to kick over an idol you must first get up off your knees.”

But Labour’s leaders no longer have that decency – the latest pronouncement reflect their policy in Government and in opposition.  They’re quite happy it seems to dance along to the Tories’ ideological tunes and abandon the people on whose behalf they once spoke.  The poorest in society – single mothers on benefits – have seen their real income fall by nearly 20% in the past year. There are many people for whom Miliband and Byrne’s latest pronouncement are enough, and have packed up their Labour membership.  Others who choose to stay should examine their consciences – and understand why a growing number of people on the Left see Labour as part of the problem, and nothing to do with the solution.

And, please, could they, and Clegg, have the decency to leave Beveridge out of this.

The illusion of choice

As the House of Lords prepares to debate the Health Care Bill, there’s an important piece in the Guardian today by John Middleton arguing powerfully that the concept of choice will make the NHS more bureaucratic, more expensive and less able to offer a comprehensive service:

Choice is an illusion created by people to sell you something. The egalitarian utopian market in which social businesses and the mightiest US private healthcare companies compete and provide health services in a mixed economy is a fallacy. Competition creates mega, monopoly suppliers. Many of the private companies are faceless, unaccountable, remote – like Southern Cross. Once in charge of a big health tender they will be very difficult to dislodge. Private companies have to grow, have shareholders to satisfy and are not immune to failure. When they fail – like Southern Cross – who picks up the pieces? However flawed our NHS and social care system, it is there and it is accountable.

Competition is the supreme example of waste in health services. Private health and health insurance systems generate enormous transaction costs. It’s an expensive process billing for health care, challenging what you are getting for your money, litigating for wound infections – and paying clever underwriters to squirm out of paying patients or hospitals. NHS management costs run at not much more than 3%, compared with nearly 20% for the US.

The very nature of private healthcare systems generating choice requires surplus capacity – empty beds – so that patients can exercise that choice. It requires the separation of “cold” from emergency work, something the NHS has not generally achieved. So it requires more investment up front to serve the fewer patients better.

But there is yet more waste: as the NHS faces draconian cuts in management costs we are urged to “market test” ever more services. Who is going to do this? Every substantial tender will require months of management time: people to write specifications for services, people to scope how big the budget should be, and how to measure the quality of the work; how to involve the public who will use the service, and how to ensure fairness and equality of access.

This process is also generating huge amounts of work for procurement accountants, lawyers and due diligence negotiators for the successful bidders and the NHS commissioners. These people, not on the employer’s books, are hidden from management costs – so don’t feature in the staffing reductions we face in NHS management. So there may be an impression of management cost reductions while transaction costs increase.

It’s a sobering dissection of the cost of the ideology of choice – and it’s worth remembering that this is about breaking up what is one of the most efficient and cost-effective healthcare systems on the planet.  But there’s nothing new in this.  As Middleton points out, it follows the example of the railways and the other privatised utilities, in which commercialisation has meant a culture in which decisions are regulated through contracts, which require an enormous amount of bureaucracy to manage and are hugely inflexible in dealing with the day-to-day realities of life.  Everyone who uses trains is familiar with the blame culture as train operators and infrastructure managers seek to pass off the responsibility on to their contractors for delays to the service.  It’s part of the failure of the Coalition vision that their rhetoric about concentrating resources on the front line so contradicts the reality of the bureaucracy needed to run a system of competing service providers.

And it’s also ironic that Cameron’s Tories get hugely exercised about the role of the EU in national decisions at the same time as opening up healthcare – which the Lisbon Treaty reserves as a matter for national governments – to EU rules on competition and procurement.

The alternative to choice is a system of universal, cost-effective excellence.  If your local school offers a high standard of education, and is part of an integrated system, why is it rational (issues of snobbery apart) to go through the agonies of the school selection process and the drudge of bussing (or more likely) driving children across town – that of course is assuming you live in a town large enough to offer a choice?  Likewise, if the NHS is offering a reliably excellent service, why go elsewhere?  And how does a layman with limited medical knowledge choose a doctor anyway.

That’s the problem with choice.  It’s not about providing better services – it’s actually a rationale for not doing so, because even as costs soar and quality declines, politicians can always fall back on the claim that people have a choice.  It’s an ideological rationalisation of the act of walking away.  And the evidence shows that it has absolutely nothing to do with improving services.

Corrupting the academy

David Willetts – the man they mystifyingly call “two brains” – has come up with yet another of his wheezes. He suggests that teenagers from the wealthiest families should be able to secure places at elite universities if they can pay the full fees up front. These extra students would not be eligible for student loans – hence only the very wealthiest would be able to take advantage (with fees at a minimum of £12,000 per year and an average national wage of under £25,000).

It has caused predictable outrage – and rightly so. It’s obvious – so obvious that it barely needs saying, but some people seem to miss the point – that the privileged have been buying preferential access to elite universities for decades. Private schools educate 8% of children but account for 50% of the intake at Oxford and Cambridge – a figure that has barely changed since I was an undergraduate at Oxford in the early 1980s. They’re better resourced, better prepared, better connected – and that’s before we get on to the state subsidy that private education enjoys through charitable status and VAT exemption. And – as anyone who has been through the system knows – it means that Oxbridge places are taken by a wealthy minority who can’t hack it academically, taking places from state school students who could.

In one sense, then, Willetts is merely proposing to make explicit something that has gone on for years. But at least the high entry requirements gave the appearance of meritocracy – it’s difficult to see how the arrival of a cadre of the super-rich exempted from the usual applications process will do anything other than reduce academic standards and lead to a the two-tier system of the nineteenth century, with scholars doing academic work and gentlemen commoners essentially loafing at an elite finishing school.

But this begs some pretty fundamental questions about what universities are for.

The Robbins Report of 1963, which paved the way for the expansion of higher education in Britain, was in no doubt. It argued that university places “should be available to all who were qualified for them by ability and attainment” (the so-called Robbins principle). There should be four principal aims:

instruction in skills; the promotion of the general powers of the mind so as to produce not mere specialists but rather cultivated men and women; to maintain research in balance with teaching, since teaching should not be separated from the advancement of learning and the search for truth; and to transmit a common culture and common standards of citizenship.

In other words, the aims of higher education were collective as well as individual. Economics – and especially the enrichment of the individual – take a back seat. Higher education should be made widely available because as a society we all benefit from it. And it follows that as a public good, it should be generously funded to ensure that the benefit is gained as widely as possible.

It is that principle that has been lost in the rush towards the marketisation of higher university. When I went to Oxford in 1980 I paid no fees and got a full maintenance grant. The move away from that provision has been justified in individual terms; the individual benefits and should pay. Graduates will earn more and will therefore be able to handle debt. And Universities are full, so why worry about whether people are being put off?

Allied with this is the quest for status and power. Degrees as the stepping-stone to higher salaries – elite universities not as places where study is undertaken but where useful contacts and the friendships that oil the wheels of political and financial institutions made, social refinements acquired and a certificate handed out at the end of it. The place where, as Ivan Illich put it, the head start is rationalised as achievement. If that’s what you think universities should be, then Willetts’ proposal is not without a certain logic. The logic only disintegrates when you start thinking that universities should be about learning and the collective good.