Universal Credit is not ‘spending’; it’s a transfer payment

At the risk of generating more fog than light, I’ve just tried to squeeze a complicated little argument into a tweet. Benefits are commonly presented, in public accounts and in the media, as a form of public spending.  That’s not strictly true.  Benefits are technically a form of ‘transfer payment’.  The government doesn’t actually spend the money; they pass the money to the people who receive benefits (pensioners, families and so forth) so that they can spend it.

This has one of two effects.  If the transfer is paid for by personal taxation – that’s not the only way for governments to raise money – then benefits are simply redistributive.  On the face of the matter, redistributive transfers are economically neutral  – they have very little effect.  If they do have an effect on economic activity, it’s because people on lower incomes may well spend their money differently from people on higher incomes.   Typically, they save less (so the money is used more) and they spend more on food as a proportion of their income.

If the transfers aren’t paid by personal taxation, the situation is a little more complex.  If the cost can be tracked to a specific form of finance, that may imply a different pattern of economic behaviour, and the transfer payment may not be so neutral.  However, government finance doesn’t work to a strictly balanced budget, and it’s quite possible that the money will simply have been created, like ‘quantitative easing’ or ‘helicopter money’.  In the present circumstances, there’s a very strong argument for government to maintain a flow of money in order to shore up economic demand.  Quite apart from that, of course, the case  for protecting people on low incomes while that happens is strong in its own right.

On “The shame game”

The Poverty Alliance hosted a session yesterday prompted by Mary O’Hara’s book, The shame game: overturning the toxic poverty narrative.  It’s a powerful and very readable book, notably strengthened by her personal reflections.  I’d part company with her argument, however, right at the end, where she suggests that the central task is to challenge and overturn the ‘toxic narrative’.  Nor do I share the confidence of Nat Kendall-Taylor, the second speaker at the session, that the task is to find better ways of communicating, because we’re better at it than we used to be.

My own work on stigma was done nearly forty years ago – it was the subject of my doctoral thesis, and my first book.   The stigma of poverty is deeply entrenched in our society, and in many others.   The moral condemnation of the poor  didn’t begin with austerity, or Thatcher, or Reagan; modern politicians have simply mobilised and endorsed prejudices that have been there, literally, for centuries. The stigma of poverty is also reinforced by a broad set of overlapping stigmas – such as the rejection of dependency, disability, mental illness and class.   In the course of my work, I came to think that this was not so much a matter of discourse, as a reflection of something much deeper.  It’s hard to explain the association of poverty with immorality and dirt in purely rational terms.  If anyone out there is interested, my book, Stigma and social welfare, is freely available on my open access page.

It follows that I don’t think that challenging the narrative – a strategy which has been tried repeatedly since at least the 1930s – is likely to be effective in eradicating age-old prejudices.  If we look at what is effective instead, I’d argue that the policies which have worked best have not been directly concerned with poverty at all.  For example, we’ve largely taken health care out of the picture; we don’t criticise the poor recipients of health care for their dependency.  The same is true of the beneficiaries of primary education, libraries, buses and sanitation.  State Pensions and Child Benefit are very effective at helping people who are poor, but they’re understood in different terms.  The least stigmatising policies have been aimed, not at the poorest, but at the welfare of everyone.

The government’s misleading figures about poverty reflect a wider problem

The Prime Minister has been upbraided by the Office for Statistical Regulation (part of the UK Statistics Authority) for his assertion that child poverty is falling, when on all the tests used by the government the opposite is true.  I’m not greatly enamoured of those tests.  I’ve considered the case for the standard test of ‘relative’ poverty, 60% of the median income, in other work – it’s not bad, but we need to accept that it’s a pointer, not an authoritative measure. The claim that the figures for 2010/11 represent a test of ‘absolute poverty’ is particularly suspect.  Having said that, however, there’s no real excuse for blustering that poverty has been getting better, when your own figures say that’s not so.

This is part of a wider problem, and one we’ve seen increasingly in the course of the last few years.  The UK Statistics Authority was formed in the hope that it would be possible to maintain confidence in the integrity of official statistics.  In the course of the last ten years, however, we’ve seen a growing contempt for statistical evidence,  shown in the treatment of figures about crime, social security claims, incapacity, the management of coronavirus and more.  It’s done whenever departments publish figures that are not official, when the press is steered to have a go at popular targets like migration or benefit fraud, and when ministers just make stuff up. There is a cost to undermining public trust: it’s not just that some figures can’t be believed, but that everything becomes open to doubt.

My new book is out: The poverty of nations

The print copies of my latest book, The Poverty of Nations, have just arrived.  I can’t physically lift the parcel at the moment, because yesterday I fell off a ladder and after a trip to A and E I’m currently shuffling around with an NHS-supplied walking stick.  Getting the books is nevertheless invigorating enough to merit a trip to the keyboard.

The book 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. The contents list looks like this:

  • Introduction: Representations of poverty
  • Part I ~ Poverty: economic and social relationships
    • Poverty
    • Poverty and the economy
    • Economic development
    • Inequality
    • Exclusion
    • Poverty and rights
    • Poverty and social policy
  • Part II ~ Rich and poor countries
    • Poverty in national perspective
    • Poverty and the state
    • Poverty in rich countries
    • Poor countries
    • Rich and poor countries
    • Responses to poverty
  • Conclusion: Poverty and social science

I’ve previously put out some explanation about my line of thought.  Here’s an earlier summary of the central argument:

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.

I know that there are many people in the field in the UK who will disagree with me.  When I put put a short piece on the Social Policy Association website, one response looked like this:

Why is it so difficult for so many people to grasp that the concept of poverty itself is the serious lack of the necessary and adequate resources …? What Paul Spicker and thousands of others describe is the consequential deprivations, as if accumulating descriptions will clarify the conceptual point….. That suggests ideological bias.

I’m encouraged, however, by the reaction of people who work in the global South, whose reviews are on the Policy Press website.  Michael Noble, who I’ve not worked with, wrote this:

For those of us working in developing countries where minimalist monetary measures of poverty dominate, this book provides a welcome enjoinder to place social relationships centre stage in poverty discourses and when considering policy solutions.

Harry Burns on mortality figures

I’ve recently joined the board of Barony Housing Association, which is part of the Wheatley Group, and consequently was invited to a institutional lecture by Prof Sir Harry Burns, who was considering mortality statistics in Scotland and the UK.  He made the case that, despite the emphasis on nutrition in much of what’s written about public health, nutrition is not at the core of the problems.  Scotland’s nutrition-related mortality follows a pattern, astonishingly, which is not much different from Finland’s.  Finland has an exemplary nutritional policy and lots of virtuous practices, and Scotland (notoriously) doesn’t.

The real difference in mortality, he argued, occurs in younger age groups; and the primary issues for the mortality of younger adults are drugs, alcohol, violence and suicide.  All of which are social.

Poverty is killing babies in England

An article in the British Medical Journal shows a clear and strong relationship between the increasing number of deaths of children under 1 and the distribution of poverty in England.  The authors write:

The sustained and unprecedented rise in infant mortality in England from 2014 to 2017 was not experienced evenly across the population. In the most deprived local authorities, the previously declining trend in infant mortality reversed and mortality rose, leading to an additional 24 infant deaths per 100 000 live births per year …  There was no significant change from the pre-existing trend in the most affluent local authorities.  …  Overall from 2014 to 2017, there were a total of 572 excess infant deaths …   The findings suggest that about a third of the increases in infant mortality between 2014 and 2017 can be attributed to rising child poverty.

This is a conservative estimate, because the figures are area-based, not individual; the association with poverty might be much stronger.

This is what the UN Special Rapporteur had to say about poverty in Britain:

14 million people live in poverty, and 1.5 million experienced destitution in 2017 …. Food banks have proliferated; homelessness and rough sleeping have increased greatly; tens of thousands of poor families must live in accommodation far from their schools, jobs and community networks; life expectancy is falling for certain groups; and the legal aid system has been decimated. … Following drastic changes in government economic policy beginning in 2010, the two preceding decades of progress in tackling child and pensioner poverty have begun to unravel and poverty is again on the rise. Relative child poverty rates are expected to increase by 7 per cent between 2015 and 2021 and overall child poverty rates to reach close to 40 per cent.  For almost one in every two children to be poor in twenty-first century Britain would not just be a disgrace, but a social calamity and an economic disaster rolled into one.

The increase in poverty is the result of deliberate policy.  That policy is killing people.

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.

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 Special Rapporteur condemns the British government’s ideological destruction of the welfare state

The final report on the UK by the Special Rapporteur on Extreme Poverty and Human Rights is damning: “much of the glue that has held British society together since the Second World War has been deliberately removed and replaced with a harsh and uncaring ethos.”

The report is in Microsoft Word format, which may make it inaccessible to some, so here is a PDF version. Here is a taste of what he says:

The Government has made no secret of its determination to change the value system to focus more on individual responsibility, to place major limits on government support and to pursue a single-minded focus on getting people into employment. Many aspects of this programme are legitimate matters for political contestation, but it is the mentality informing many of the reforms that has brought the most misery and wrought the most harm to the fabric of British society. British compassion has been replaced by a punitive, mean-spirited and often callous approach apparently designed to impose a rigid order on the lives of those least capable of coping, and elevate the goal of enforcing blind compliance over a genuine concern to improve the well-being of those at the lowest economic levels of British society. It might seem to some observers that the Department of Work and Pensions has been tasked with designing a digital and sanitized version of the nineteenth century workhouse, made infamous by Charles Dickens, rather than seeking to respond creatively and compassionately to the real needs of those facing widespread economic insecurity in an age of deep and rapid transformation brought about by automation, zero-hour contracts and rapidly growing inequality.

I suspect that those of us who live here have become hardened to it, so that it doesn’t seem quite so bad as it does to an external observer.  Certainly many of the underlying problems have gone on for decades – I remember findings in the 1980s, from the Policy Studies Institute, that half the families on benefit were running out of money most weeks.  The retrenchment of social security in the 1980s and 90s, and the ‘welfare reforms’ after 2000, have all added to the problems.  The sad truth is that we left behind the principles of the welfare state long ago.

The problems of people who beg

Shelter Scotland has published a noteworthy report profiling people begging in Edinburgh.  The report asked questions of 420 people; that’s unlikely to be everyone, but it’s a lot.

Addiction plays a large part, with nearly 90% misusing drugs or alcohol; more than 80% had mental health problems, mainly depression and anxiety, and more than 60% also had physical health problems.  It’s a population that overlaps with street homelessness – 43% said they slept rough – but the two things are not equivalent, and I was struck as much by the differences as by the similarities.  When I worked on the census of homeless people in Aberdeen, it was the support staff who tended to say that the problems were problems of life-style and personal issues; homeless people said that the main problems were that they were cold and they were hungry.  People begging in Edinburgh seem far more likely to say that it’s down to their personal issues.

I did wonder if people might have been steered in some directions by the shape of the questions asked.  One of the messages from the qualitative studies I’ve done with psychiatric patients in the past is that family matters; the people left without support to become homeless are mainly those whose relationships with the family have broken down.  This is hinted at, but overall it’s not a major factor here.  In fairness, though, it’s difficult to set up exploratory, discursive interviews with homeless people (been there, done that); the remarkable thing about the Shelter study is how much information they’ve been able to bring together.