I took part today in a phone-in on Radio Scotland. Three main issues were raised.
The first issue is an assumption that people opt to live a life on benefits and have children as a way of increasing their benefits. This is a misunderstanding. Larger families tend to be older families (because it takes time to have a larger family). They come to benefits for other reasons – typically unemployment, disability or divorce – after a change in circumstances. Much the biggest group of people who get long term benefits are older people with disabilities. They are are less likely to have young children than others.
The second issue is an assumption that people who have lots of children gets lots of benefits, and those benefits will be lost if people work. For the most part, that isn’t so; it’s not how our benefits system works. Most of the allowances for dependent children on income-tested benefits have disappeared. People get Child Benefit whether they work or not. The main effect of having a larger family is either to change the calculation of Housing Benefit and Tax Credit, or to change the size of house that a family needs. Their rules apply to people in or out of work. If entitlements to larger families were cut, it would directly affect entitlements of people in work – which would have the opposite of the effect that Iain Duncan Smith is claiming. It would also create a penalty for combining families, another perverse incentive.
The third part of the story is that the money needs to be used elsewhere. Apart from the obvious rejoinder, which is that it won’t be used elsewhere – the government is trying to save £10 billion – it won’t save much either. What it will do is to create greater hardship for a particular group of claimants – 300,000 out of nearly six million. That 300,000 is responsible for more than a million children; on paper the cuts would apply to a minority of the children, but of course they would affect the welfare of all of them. I was troubled in the discussion by the repeated assertion from Alex Johnstone MSP that “welfare needs to be a safety net”, by which he means that it should be confined to the role of a safety net. It needs to be much more than that; it needs to protect people from disruptive changes that will push them into hardship. The proposal threatens to make matters much worse.
I heard IDS on the Today programme when the inteviewer persistently asked how many families are there that are supposedly having children to get child benefit. IDS totally stonewalled, avoided and obfuscated – and has not yet come with anything other than his claim that “there is a large number”, without a shred of evidence. I find it sad that it seems like what appeared to be a genuinely radical attempt to reform the benefits system has, perhaps predictably, fallen foul of idealogy and plain old prejudice when it comes to people needing to claim benenefits. So much for evidence-based policy.
It’s a further pity that the Labour Party and Lib Dems so readily follow in this supposedly populist line.
And it’s good that sterling work in this area is now being done by the SFHA an NHF – as well as yourself Paul.