The consultation on child poverty

The DWP and Department for Education are consulting on “better measures” of child poverty that will include a range of considerations – deprivation, parenting skills, worklessness, debt, housing, education, parental health, and family stability.

There are three fundamental muddles here. The first is the confusion between definition and correlation. We know that some people are more likely than others to be poor, such as families headed by women or people in lower social classes, which are not on the list. Even if all the things in the consultation were associated with poverty, it would not mean that they defined poverty.

Second, an association – an increased likelihood – is not the same thing as a characteristic. Poor families are more likely to have children at risk – but that does not mean that most, or even many children are at risk because they are in poor families. Poor families where children are at risk are a very small minority.

Third, the model in the consultation is based in an unjustifiable, stereotypical identification here of poverty and family problems. Many people – on low income figures, most – have been poor at some point in their lives, and all of us are vulnerable to poverty. Family problems are something quite different.

Work tests for sick people

The Telegraph (again) reports that the government is considering subjecting people to work tests when they are sick for short periods. The benefits system used to make a distinction between sickness for less than 28 weeks, which got Sickness Benefit or Statutory Sick Pay, and longer periods, which were covered by Invalidity and then Incapacity Benefit. That distinction has gradually disappeared, and now everyone moves directly on to Employment and Support Allowance after SSP. But that also means that many people on ESA have relatively short periods of sickness. People sick for three months are now tested for their capacity to work. The government is now concerned about those who are on benefit for longer periods – and the way to get them is to intervene earlier. That means that they are proposing to examine those who are sick for short periods.

The problem with examining everyone who is sick is, of course, that it is going to generate a huge amount of administrative interference. Half of those people can be expected to return to work after sickness regardless; the other half are mainly those who it is “not reasonable” to expect to work. All of them are liable to be subject to work tests.

Dividing up the single police force

When the Scottish Government announced the plans to merge Scotland’s eight police forces into one, they complained: “Scotland can no longer afford to do things eight times over.” (There have been, actually, more than eight services – there was also the nuclear police, the transport police and the Scottish Crime and Drug Enforcement Agency). In parliament, however, a requirement was made to have plans for all the 32 local authorities, and today it’s been announced that there will be 14 policy authority areas, replacing the previous eight. So the main effect of a single police service is not to reduce the number of service divisions, but to centralise control.

Universal Credit: failing IT

Computer Weekly’s editor asks whether Universal Credit has to fail as an IT project. Universal Credit, he comments, “is perhaps the last of the mega-projects that was set up under the old rules”; in time to come, new approaches should stop the stream of bad decisions. But Universal Credit is not, first and foremost, an IT project; it’s about benefit delivery, and information management is secondary to the basic objectives. The reason why the programmers can’t deliver the programme yet is not because of the problems of coordinating IT, challenging as they are; it’s because the government has failed to work out what the circumstances are it’s dealing with, what needs to be coordinated and what needs to be delivered. No computer system can possibly answer those questions.

The World Bank on jobs

The new World Development Report 2013 is available, with a focus on jobs. One of the straplines on the website, also on p 57 of the report, claims that

“Jobs are created by the private sector; public action sets the stage”.

Sometimes the balder claims are qualified, but similar sentiments keep cropping up in the course of the report:

“it is not the role of governments to create jobs … as a general rule it is the private sector that creates jobs. The role of government is to ensure that the conditions are in place for strong private-sector-led growth …” (pp 21-2)

This is ideological claptrap. Do we think that police, teachers, firefighters, roadbuilders or health workers don’t have real jobs?

“The private sector is the key engine of job creation, accounting for 90 percent of all jobs in the developing world.” (p xiii)

Doesn’t that imply that the public sector in developing countries is small by comparison with countries that are economically more successful? And where would the private sector be without the demand for infrastructure generated by governments?

There’s yet more doctrinaire stuff:

  • “Any taxes create distortions” (p.27)
  • “The solution to all these demographic and technological challenges rests with the private sector.” (p.58)
  • “Different labor outcomes among persons with disabilities stem from productivity differentials, from disincentives created by the system of social benefits …” (p.84)
  • “policies should aim at removing the market imperfections and institutional failures preventing the private sector from creating more of those jobs.” (p 257)

This tone isn’t maintained consistently all the way through the report, but it’s troubling to see that the Bank still gives so much prominence to the discredited economic purism that led to Structural Adjustment. I thought, or hoped, that we had moved on from there.

Words fail

The DWP has apparently ordered trials of voice-recognition technology as a means of identifying claimants online. For those who haven’t noticed, the proposal for making benefits ‘digital by default’ relies on millions of people using broadband and computers they currently don’t have access to; much of the software has not yet been released, tested or consulted on; massive IT contracts have been associated with major problems of control and continuity; the development of the system is faltering. And yet we have a proposal that depends on eight million people having something to speak into, understanding the processes and the questions, and speaking recognisably, clearly and consistently; and, because exclusion from the system will be obstructive to the administration and disastrous for claimants, there have to be no mistakes. It seems to be another case where the promises of IT specialists simply fail to relate to the conditions they are being asked to provide for.

Additional note, 10th December 2013.  In evidence to the Work and Pensions Select Committee, Howard Shiplee explained that a system that was fully digital and online could not be feasible, because it could never satisfy the requirements of security.   Banks, for example, require people to present themselves to open account.

Universal Credit and the poverty trap

A report for Gingerbread by Donald Hirsch claims that Universal Credit will not much help single parents on lowish incomes. The figures are uncertain, because the government has provided so little information about what the levels of benefit and the tapers will be. Hirsch’s central point is that if the effect of withdrawing Universal Credit is combined with the deductions of tax and national insurance contributions, the marginal rate of deduction – the ‘poverty trap’ – will be well above the headline figure of 65% or so that the DWP has been working on. It’s unclear whether the ‘poverty trap’ has ever had the effect on incentives that is attributed to it – it could happen, but people have to claim the benefit, know what the amounts of benefit are, and what the effect of extra work will be. It does reflect, however, on the fairness of the system – and a high marginal rate of deduction is built in to the design of benefits which are tapered as income increases. One of the key claims for UC was that it would bring the marginal rate of deduction down with a bump. It can’t do that unless both tax and NI thresholds are put beyond the scope of low incomes – a policy which Hirsch condemns as regressive.

"Glitches" in Universal Credit

The Independent on Sunday reports today that the Universal Credit pilots are in trouble. The national roll-out will be delayed, with more focus on regional pilots, costs have over-run, staff have left and the Treasury has identified the programme as being in crisis. Some parts of this were previously revealed by Computer Weekly. The Independent cites a ‘government advisor’: “IDS, like other ministers before him, has been hypnotised by promises of what an online system can deliver. Warnings were given to him more than a year ago. They were ignored.”

It’s hard to believe in retrospect, but it’s now over two years since I first warned in this blog that the scheme was impractical. I’m still hopeful that enough might be done to avoid catastrophe for millions of people. That can only be done through a process of development which is more reflective, more open, less presumptuous and slower.

Extra note, 14th November: another remarkable report from Mark Ballard at Computer Weekly suggests that Iain Duncan Smith has been kept in the dark about how badly things are going. That contrasts with his own conviction, previously reported in CW, that he is personally engaged and fully in control.

A just punishment?

A report in yesterday’s Stirling Observer causes me some disquiet. It explains: “A benefit cheat who received more than £15,000 to which he was not entitled has been jailed … James Yuill (61) admitted receiving £15,360 in Income Support between June 2004 and November 2010 to which he was not entitled. Stirling Sheriff Court was told on Wednesday that he had stated on a benefits review form that he was not in paid employment. In fact he was working for 12 hours a week as a bakery delivery driver.”

Yuill had been told by his CAB that he could work while on benefits for up to 16 hours a week. That’s a common enough muddle; people often don’t realise that the rules which apply to one benefit don’t necessarily apply to another, that some benefits let people work and others don’t, or that actions that are permissible still need to be declared. Nor was there anything immoral about his behaviour; getting some part time work while on benefits is exactly the sort of thing that the government wants to encourage, and the DWP Pathfinders were marking it up as a success if only they could get someone to do what Mr Yuill was doing. There’s an issue here with mens rea. The decision to claim a benefit without being entitled cannot in itself be evidence of a guilty mind; if it was, any benefit application which someone failed to qualify for would be an offence. So the guilt must rest in either a misrepresentation, or the failure to declare the work, and that – not the amount of money – is what is being punished here.

My concern is not so much with the conviction – there was an offence in not declaring work, even if it does come from confusion – but with what happened next. High Court guidelines specify that cases of social security fraud should lead to imprisonment where people have claimed substantial amounts of benefits they were not entitled to. Mr Yuill was sent to prison for five months. There’s something deeply wrong here. A first time offender in his sixties, in poor health, makes an unwise claim and goes to prison for it. This can’t be in anyone’s interests. The fault lies in the High Court guidelines, and they should be changed.

Football is broken

Football bores me personally, but it’s hard to live in Scotland and not to be aware of the passion and commitment it arouses in Scottish communities. A tiny nation has been trying to accommodate a finance structure which belongs to an international entertainment industry, and has made local clubs the playthings of rich entrepreneurs. It doesn’t work. We’ve just had the announcement that a second major club faces imminent bankruptcy, and it’s the fans and supporters who have been asked to save it.

This posting, then, is flying a kite. Communal activities, which rely on communal support, don’t have to be organised communally, but they can be. Public organisations which promote “participation in sport”, recreation and culture are now able to register as charities in Scotland – provided they are not for profit, they offer substantial benefits to the broader community, and they are properly governed. (There’s no intrinsic bar to a professional sport. The English Charity Commission’s guidance is directed only at amateur sport, but that’s not the distinction here; other charities employ professionals, and some such as theatres put on professional shows.) The full list of criteria for charitable status is laid out at OSCR’s website. A football club could qualify. But it is going to call for a rethink of what football clubs do, and how they do it.