The poverty of nations: a relational perspective

I’ve signed a contract to deliver my next book by the end of this month.  The working title is “The poverty of nations: a relational perspective”, and it develops an argument I’ve been building over the last few years about the relational elements of poverty – understanding poverty, not as a lack of resources or income, but as a set of social relationships.  I posted, two years ago, the abstract of a paper on this general theme. Here is that abstract again:

Poverty is at root a relational concept, which can only be understood by locating the experience of poor people in the social and economic situation where they are found. This is not just saying that poverty is ‘relative’. Developments in policy and practice are increasingly focused on dynamic, relational and multi-dimensional understandings of poverty; our conceptual frameworks have failed to keep pace.

Much of the consideration of poverty in the course of the last hundred years, relative or absolute, has found it convenient to rely on three fallacies. The first is that poverty is a condition or state of being, which can be considered exclusively from the perspective of the individual who experiences it. The second is that can be understood solely in terms of resources, when resources themselves have to be understood in terms of social and economic relationships. The third is that there is a clear and decisive threshold below which people can be said to be poor, and above which they are not poor.

All of these positions are tenable – they are supported by many of the most eminent writers in the field – but they are not adequate, either as a way of describing the positions that people hold, or as a conceptual tool to analyse the issues.  Discussions of exclusion, a concept which is self-evidently relational, come closer to the idea of poverty than much of the academic literature on poverty in itself, offering a way to escape from the limitations of conventional models of poverty.

The book will be out next year. It will be my twentieth, depending on how you count them, and the fourth since I left my post in 2015. People may be surprised at the short time between contract and delivery of the final copy.  It’s been my practice for many years to write a book before I submit it.  I started to do that early on, after working through the more conventional route of proposal and writing to order, only to find when I delivered the script at the end of two years the publisher thought that I should have written a different book.  This way, I can guarantee is that we all end up with what we’re expecting to get.

I wouldn’t, however, advise any young academic to follow in my footsteps.  The fact is that academic institutions don’t like books very much, or social policy, and don’t really rate either when it comes to counting the beans.  When I left my employment, I was making a choice; I wanted to do more on poverty, benefits and social theory, and going independent was the best way to do it.  I don’t regret it; in the last three years I’ve done four books, a few research contracts and a semester in Poland, which I loved. If anyone out there wants an academic career, however, you’ll all be better off writing bids for research funding.

Some thoughts on Citizens Assemblies

The Scottish Government has opted for using a Citizens Assembly as a means of addressing some of the complex issues around devolution and independence.  Citizens Assemblies have been proposed as a way of resolving lots of thorny issues, such as Brexit, social care and reviewing legislation.  I can see that some people are enthusiastic about the mechanism, but I’m agnostic.  There are lots of existing mechanisms by which complex issues can be discussed and reviewed in some depth: there are inquiries, commissions, Royal Commissions.  There are reservations to make about them all, but I’m not convinced that  a Citizens Assembly can resolve the issues in a way that they can’t.

The first problem is the issue of capacity.  Commissions are commonly limited by the terms of reference they are given, their membership and the resources they can command.  The process matters, too; I’ve been critical of inquiries led by lawyers, whose training is not necessarily appropriate to the exploration and synthesis of complex issues where a selection needs to be made.

The second concerns the validity of the positions that people come to.  Any worthwhile inquiry will draw on a range of evidence, including both primary evidence and information from experts, and Citizens Assemblies can do this, too. Some commissions are led by experts; some aren’t. The expertise of a commission is no guarantee that they will get the judgements right, and there are certainly plenty of commissions who might be said to have gone off-track.  (For example, there are still many people in Scotland who commend the Christie Commission on public services, which I think got things radically wrong.)   I’ve served as adviser to a couple of parliamentary committees, and found that they were able to address issues in remarkable depth simply because they were able to draw on submissions and testimony from a wide range of witnesses, often completing work that compares well with academic research in much less time.

There may be a specific problem with the decision-making process in Citizens Assemblies, reflecting the large number of people involved. Group thinking is vulnerable to a tendency to conformity, potentially reflecting the vocal representations of a minority.  There is also potentially the phenomenon which psychologists refer to as a ‘shift to risk’, where groups will take collectively decisions that are riskier than any of the individuals in that group would accept.

Third, there is the question of ownership.  Inquiries that take a short time are often treated as if they were doing the bidding of particular political masters; inquiries that take a longer time are then abandoned by their political successors. People who agree with the conclusions will support the recommendations; people who disagree will say that the process was not representative, or not authoritative, or that conditions have changed.The Northern Ireland Citizens Assembly has struggled to have an impact in the absence of active political representation in the province.  One has to ask about Citizen’s Assemblies whether they will have more authority, or carry more commitment, than any other mechanism, and it is not clear they will.

An apology: something strange happened when I posted this entry, and what was posted was not the entry I’d finished, but an early draft.  This full version had to be reconstructed, because there was no trace left of all of the work I’d done on it.

A protest about the two-child limit

I have signed, along with 108 others, a letter published in today’s Times.  This is the text:

Today, the Government publishes statistics on the number of families affected by the two-child limit. This policy substantially reduces support through tax credits and universal credit for low-income families with a third or subsequent child born since April 2017. The two-child limit breaks the fundamental link between need and the provision of minimum support. It implies that some children, by virtue of their birth order, are less deserving of support. It leaves affected families £50 a week worse off, and will push 300,000 more children into poverty by 2024.

The two-child limit means unprecedented cuts to the living standards of the poorest children in Britain. We know it is affecting children now. Families report struggling to pay for basic living costs and being forced into debt, and children missing out on healthy food and activities. Children growing up in poverty, or pushed further into poverty as a result of the policy, will be likely to do less well at school, have poorer health outcomes and worse life chances. It is quite simply one of the most damaging changes to the social security system ever.  

The two-child limit should be abolished before it harms more children.

Reducing payments for families with more than two children does not, of course, mean that the first two children will have support while the third child will get nothing; that is not how families work.  It means that support is reduced for the whole family, and every child in the family is effectively being penalised.

The problems with Universal Credit can’t be fixed by loans or advances.

PRESS RELEASE: UC APPG responds to childcare announcement

From the APPG I have the news that people on Universal Credit will be able to get a loan or advance to pay for their child care.  Whenever someone gets a loan or an advance they have to pay it back, usually by deductions from their benefits.  That means that, whatever their benefit entitlement may be, in the future they will get less than that entitlement.

I apologise for stating something that should be painfully obvious to anyone after a moment’s thought.  (‘Painfully’ was not the first adjective that sprang to mind.  I thought it better to moderate my language for public consumption.)

Brexit: there is a way to an agreement, but no-one seems ready to take it.

I dislike repeating myself, which is why I haven’t had much to say recently, but there is a way out of the current impasse – if only the UK government and the EU will take it.  The backstop protecting Ireland appears to be the primary source of contention.  It is only needed because the UK and the EU have not yet formed any agreement about Britain’s future relationship with the EU.  Indeed, in more than two years, thanks to an absurd initial decision about the sequence of the negotiating process, they’ve not agreed a single binding clause about that relationship.  An agreement on the future relationship would finalise Britain’s departure, and then there would be no need for any provisional arrangement to cover the particular circumstances of Ireland in the interim.   Yes, trade deals are complicated; but substantial existing deals are there as models, many of the points already in the withdrawal agreement are uncontentious, and Britain currently meets the acquis communautaire.  It could be done, if people wanted it to be done.

Unfortunately, I see no evidence either that the new UK government is interested in engaging in any kind of negotiation on that basis, or that the EU understands that there is a way out of the mess that doesn’t involve brinkmanship or a game of ‘chicken’.  Everyone has packed up for the summer.  In those circumstances, Brexit will happen without a deal.

A report on Universal Credit

The All Party Parliamentary Group on Universal Credit has published a detailed report on Universal Credit, including something in the region of 50 reasonable proposals to help the system work better.  The group has notable expertise in the field, and there is no recommendation I wouldn’t agree with, but I don’t think it goes anything like far enough.  The fundamental design flaw, which they point to at the outset, is this:

many claimants say they cannot understand how their UC is worked out, and it is subject to so many variations that it is far harder to budget on UC that it was on tax credits.

That instability of income is built in to the system.  Some of the fluctuations would be damped down by the group’s proposals, including modifications to work allowances, a review of the treatment of self-employed people and 53-week years, but they would not prevent the wild fluctuations in the amounts being paid month by month. To stop that happening, the system needs

(a) to make payments on a uniform date, rather than a personalised one which varies with weekends and bank holidays;

(b) routinely to make rental payments direct to landlords, as Housing Benefit did; and

(a) to relate entitlement to a preceding period, rather than the current one.  As this report says,

This mismatch of pay cycles and assessment periods and the ‘whole-month’ approach to changes of circumstances, can leave people struggling to budget with unpredictable and arbitrary awards.

 

Universal Credit and a pattern of fraud

A major fraud has been reported affecting Universal Credit.  Over the course of the last eight and a half years, I’ve frequently commented on the vulnerability of the UC system to fraud and error, despite repeated assertions from the government – and the falsification of the business case – to claim the opposite.  This fraud is different from most, because it represents organised criminal activity that is neither attributable to claimants nor to DWP officials.  The criminals  pretend to be other people, both claimants and people who have not claimed, to register for short term loans before any checks might be made.  (This is not, for the most part, ‘identity theft’; it is personation.  A fraud of this sort is typically a fraud on the DWP, not on the claimaint.)

It should have been obvious from the outset that computer-based identification wouldn’t be sufficiently secure for the purposes of the DWP.  There was something close to an admission of this more than  three years ago, when Verify, the successor to the failed “Identity Assurance”, was cut adrift.  But the problem is not only down to poor tech.  The situation has been produced by a system that relied on online verification, rather than claims in person; that left claimants without resources for well over a month; and replaced a system capable of processing the vast majority of claims within 14 days with one that struggled to do it in six weeks, and sometimes could take as long as three months.   Universal Credit is error-prone by design.  Its vulnerability to deception is only a part of that.

 

 

The reform of social care will take more than money

The House of Lords Economic Affairs committee has called for free personal care in England, on lines similar to the system in Scotland.  “Under free personal care individuals would therefore only receive funding for support with these basic activities of daily living, based on the minimum threshold of eligible needs as defined by the Care Act.” They are recommending a major increase in the funding for social care, so that care can be delivered on much the same terms as health care.  However, they accept that people should pay accommodation costs themselves, with means-tested support, and they recognise that this might entail “catastrophic accommodation costs” which might have to be subject to a cap.

This has been welcomed as a radical proposal, but it doesn’t touch on most of the problems that go with social care.  We’re still thinking of social care as a set of needs which can be satisfied by specific cash payments.  The Lords report explains:

“Personal care means essential help with basic activities of daily living, such as washing and bathing, dressing, continence, mobility and help with eating and drinking. It does not include other areas where support might be needed, such as assistance with housework, laundry or shopping.”

I don’t believe that a system based on this approach can ever deliver what people want to see.  I don’t believe people want, or are comfortable with, successive 15 minute visits from a team of people who bathe them, or dress them, or help them to bed.  I don’t believe that what most people really want in life is to manage a rota.  I think that providing for a series of events, sold as if they were commodities, meets people’s human needs.  What we should be allocating is time with a person, and that calls for a different approach to assessing needs from one that focuses on whether or not someone needs help with brushing their teeth.

A Scottish supplement to benefits for children

The announcement of a Scottish “child poverty” benefit has to be welcome.  In principle, it will increase the incomes of many families by £10 per week per child, starting with children under the age of six.  Focusing on the under-sixes is good; there’s a clear relationship between the age of the youngest children and low incomes.   So is the promise that it will be there for every child in a family.

The main problem with reliance on qualifying benefits is that receipt is going to reflect the deficiencies in that system.  One clear problem is takeup.  I’m not convinced by the HMRC claim that CTC goes to 85% of all potential recipients (if it’s true, it’s more accessible than any other means-tested benefit), but that still leaves out the 15% who don’t get it.  A second problem is that entitlement is intermittent, particularly for benefits assessed on the basis of income; and benefit entitlement can be interrupted by sanctions, which shouldn’t be relevant for this supplement.    Dealing with changes in circumstances – including moving out of Scotland – could also be problematic.

In practice, the details are still vague; I’ve been greatly helped by a reference supplied by Ian Davidson, who pointed me towards the Position Paper posted on Wednesday by the Scottish Government.  The qualifying benefits will be:

  • Child Tax Credit
  • Universal Credit
  • Income Support
  • Pension Credit
  • Working Tax Credit
  • Housing Benefit
  • Income-based Jobseeker’s Allowance (JSA)
  • Income-related Employment and Support Allowance (ESA).

Those benefits are all under the control of the DWP, with a particular emphasis on Universal Credit; Scottish benefits, including Council Tax Reduction and Disability Assistance, will not qualify claimants for the Scottish Child Payment.

The Economist is berated by right-wing libertarians on Twitter

An editorial in The Economist has expressed some concerns about the irresponsible pledges being made by the contenders for the leadership of the Conservative Party.

These proposals range from unwise to extraordinarily bad.  Mr Johnson’s tax cuts would be both a waste of scarce resources and grossly unfair.  He would reduce their cost by raising national-insurance contributions, a payroll tax.  As a result the biggest beneficiaries would be well-off pensioners, because payroll taxes fall only on those in work.  The policy is a shameless bribe to the elderly and prosperous Tory party members who choose the leader.

That critique has been rebuffed by neo-liberals on Twitter.  An argument from @_JamieWhyte runs as follows:

What do they mean? How are scarce resources wasted when the government collects less income tax? Does @TheEconomist  believe that private spending is more wasteful than govt spending? I cannot think of any other interpretation of this claim (help, anyone?)

That’s an intriguing argument, because it has implications its supporters may not have recognised.   If tax is a means of financing government, this would leave a deficit (which the Conservative right has consistently claimed it’s concerned about), and the money has to come from somewhere.  To govern is to choose, and this is a distributive decision.  If on the other hand tax reliefs are basically transfer payments – altering the balance of spending power between private citizens – then the same argument made here, that money held in private hands can’t be wasteful, also applies to social security payments, which are another way of doing the same. That can’t waste resources, either.

For most of the last sixty years, however, it’s largely been accepted that tax reliefs are simply a cost to government (the argument was made by Titmuss).  If they’re a cost, they must be justified; and a cost to benefit the rich, imposed at the expense of lower-paid workers, is hard to defend.

The libertarian right usually sees tax relief as allowing people to keep ‘their own’ money. The basic objection to that position is that incomes and tax rates are entirely conventional.  (Note that the defenders of the proposed tax cuts have been commenting that senior policemen and nurses – whose pay is determined entirely by public policy  – should not be subject to higher rates of tax. ) The reason why Nordic countries can sustain higher tax is that the structure of their incomes is different, and conversely the low taxes in Mexico are not compensated for by higher incomes.  No-one should imagine that, if the structure of tax rates was to be fundamentally reformed, their income will ultimately look the same as it does now.  We have to counter the illusion that tax is capturing people’s private incomes.  The distribution of income is not a private matter.