By Guest
George Selmer works in business development for a Welfare to Work provider, supporting people back into jobs.
This morning, the Daily Express leads with a story on ‘benefit cheats’. In truth, the taxpayers’ money they ’scooped’ was the result of errors by DWP staff that led to overpayment of benefits. The tone of amazement that one ‘benefits cheat’ has recently been given ‘100 years to repay £70,000 at £14 a week’ fails to mention that £14 probably represents a substantial percentage of that individual’s weekly allowance – on which they’d already struggle to make ends meet. The article speaks in the voice of the aggrieved and angry ‘hard-working taxpayer’. It has no interest in the lives behind the phrase ‘benefits cheat’ – their individual circumstances, hopes and dreams, or the weight of geography, history, culture and economics that has put them where they are.
The perception created by government and the media distorts in another way. New Labour created the notion that we live in a meritocratic society – that as long as you have the talent and wherewithal, you can achieve your desires. This impression is ubiquitous, from newspapers and lifestyle magazines, to Britain’s Got Talent and Location, Location, Location. Surely everyone lives like that?
Of course, reality is starkly different. The median salary in this country is just over £20,000 per year. That means that half of the entire workforce earns less than that. Earning just over £44,000 per year puts you in the top 10% of earners. And yet, somehow, the media has created the perception that we are a nation of upwardly mobile, affluent professionals. Over 20% of working age adults in the UK live in low income households. And, as we learnt only yesterday the gap between the top and the bottom continues to widen.
Take the area in which I live, Redcar & Cleveland, where the Corus crisis is merely the tip of the iceberg. There are over 5,000 people claiming Jobseekers Allowance. This is up 1,500 on 12 months ago. Real levels of worklessness are likely to be around three times this. It’s concentrated, in the main, in some of the most deprived wards in the country, where almost half the working age population will be out of work. If Corus goes, there could be up to another 10,000 people out of work. How does the area absorb that? There are already approximately 17 workless people for every available job. About 3% of those jobs are in manufacturing and less than 1% are in construction. The vast majority (over 75%) are in public admin or finance. How do we tackle worklessness and poverty and tell people that they have opportunities, without a range of good quality, sustainable jobs? If Marx got nothing else right, he was spot on when he observed that men and women make their own history, but not in conditions of their own choosing.
We see real, workless people in our offices every day. The reality is that the vast, overwhelming majority of people who are out of work categorically do not want to be so.
You try re-calibrating the expectations of an 18 year old lad, without a GCSE to his name, who has spent his whole life absorbing this culture of possession and consumption, and at a deep level has bought without question the idea that we live in a society filled with opportunities for all. Try telling him that there’s a couple of warehousing jobs available and you could maybe get him an interview at TK Maxx, unless he goes back to college. You try telling the twenty years, time-served, steel-worker that there are some part-time vacancies available in Argos or something in security, if he can find the money to get the relevant certificate. Can you understand the anger they’ll feel? The sense they’ll have that somehow they’re not allowed to join in with the rest of us?
Yes, there are some people out there who try to ‘take advantage’ of the system. But is a system and more importantly a society – that puts it’s citizens in a position where they feel they have no other choice but to do so to make ends meet – fit for purpose? And, equally importantly, what does it say of a society that can disenfranchise citizens so comprehensively that they feel little remorse in ‘playing the system’? The language of ‘welfare reform’ – which is dissected by David Coats in his post today – talks of ‘rights’ and ‘responsibilities’. But this already skews the relationship from being one between active society and participating citizen to being one between dispensing state and recipient individual ‘beneficiary’. In this formulation, both the ‘rights’ and the ‘responsibilities’ belong solely to the individual. The state bestows certain ‘rights’ upon them, in return for the fulfillment of certain ‘responsibilities’. This one-way street completely overlooks the fact that we as a society have a responsibility for each of our citizens. What should be a reciprocal relationship has been skewed by the most powerful tool of all – the language we use.
I’m not condoning ‘cheating’ the system in any way shape or form. But it says something about government, the media and each and everyone of us when you think of the high-profile public campaign to clamp down on benefit fraud and then remember that tax evasion by the wealthiest costs the Exchequer 15 times as much - to relatively little public outcry or government action.
The media and, through the media, our politicians, have simplified and distorted the general public’s view of one of the most urgent problems facing our country today. It’s not black and white. It’s not ‘them’ and ‘us’. It’s not ‘right’ and ‘wrong’. It’s not ‘work-shy scroungers’ and ‘hard-working tax-payers’. It is a multi-faceted, complex social and economic time-bomb that’s been ticking away for the last 30 or 40 years.
It’s about the relationship between government and citizen, the degradation of civic society and the public sphere, it’s about economics and geography, culture and education. And it’s about every single one of us. By changing the way in which we represent the problem we can start to tackle it. And that means that those of us who know the reality need to publicly contest the misrepresentations we see in our media and our politics. That’s our responsibility.
Joe, apologies for pretty much completely misinterpreting what you said!
And yes, I think you are dead right about the magnitude of the gap at different levels on the scale. And that is a large part of the problem – what we struggle with, and what I’ve said in every forum I’ve had the chance to say it in, from local authorities to government ministers, is that we can only help people into the jobs that are out there. In some areas the jobs aren’t there. And often, by the time people reach working age, much of the damage has already been done and we are simply firefighting. So we also need to think about how important investing in the structure and infrastructure of local economies can be and how important investment in early years must be.
I think you’ve hit the nail on the head in the last sentence there. That’s a real issue.
Emma – I think you’ve raised a really key point, and one that needs addressing as well. The targeting of high interest credit at low income households should absolutely not be acceptable. This is why capitalism needs to be managed in a mixed economy – we need to make the markets work for us rather than the other way around.
I’m sorry, I didn’t express myself very well.
What I meant was that it is not clear whom the ‘rich’ and ‘poor’ refer to and where the gap is expanding.
I suspect, for example, that the gap is far greater between those living on the minimum wage and those in a lower middle earning group than between (say) those earning £35k and those earning £44k. I am not for a second implying that it is not extremely difficult to live on the minimum wage.
And I am ‘up close and personal’ with people on low incomes. This is not about me, this is about thinking what these figures actually mean – I’m wondering if what it really means is not just that the top 10% are getting richer but that the bottom are falling behind the majority.
The real issue to me is what I call “institutional benefit fraud”, the growing number of companies targeting low income households with products and services at grotesque profit margins. Prime offenders are energy providers and those offering sub-prime credit (the only lending sector unaffected by the Crunch, it seems).
For instance, households which pay for energy by cash, cheque or meter pay on average some £260 a year more than other customers – equivalent to around one month’s unemployment benefit in surcharges and all nicely paid for out of tax payer’s money!
Now of course, a month’s worth of take home pay at £44kpa+ is a tidy sum, but as that’s earned by only 10% of the population, the figures are everything in this grotesque variation of pile ‘em high and sell ‘em cheap. In terms of sheer numbers, it’s ironic that critical mass should be with lower income households. But these poor folk are destined to remain “them” and not “us” for so long as we fail to recognise how many of us are incredibly close to their standard of living.
National Statistics data indicate that 50% of us own a meagre 1% of private wealth, excluding home ownership (7% if we add the homes back in), therefore bipolarity of income is compounded by bipolarity of wealth.
Then, of course, we’re inclined to think of sub-prime lending as dodgy doorstep deals: at best, the likes of Provident who made a whopping £52 million pre tax profit in the first half of 2009/10 and at worst the likes of John Kiely, the infamous Mancunian loan shark sentenced to five years last summer. Not so! In the last fortnight alone I have been waging a social media battle with Littlewoods over the incessant drive to get me to switch my meagre catalogue balance to 29.9% APR – one call and three letters, so far – all carefully targeted at the post Christmas blues!
Therefore, enough debate I say. If you want the statistic to end all statistics, we need to calculate the proportion of benefit payments accounted for surcharges and premium interest payments. Imagine the saving to public services and taxes made by eradicating this kind of exploitation. Indeed, me we might not even need to freeze public sector pay at £18kpa and above, not to mention avoiding job losses…
It means an awful lot to say that the gap between the rich and the poor has widened. The post links to a Guardian article which outlines the detailed report that evidences this claim (and contains a link to it).
Julian Dobson makes the very good point in his post earlier today – http://www.community-links.org/linksuk/?p=1473 – that we must go beyond the statistics and recognise that there are real people, living real lives behind them. If we did that, I suspect that you’d find that it is very tough indeed to live on the minimum wage – and some live beneath that level. I think it’s fair to say that to live above the £44k barrier means that you are able to live a life of comparative comfort, compared to those on minimum wage who often struggle to simply pay the bills and put food on the table – that’s an uncomfortable reality, but it’s there.
There are a plethora of measurements of economic wellbeing, from the Office for National Statistics, to the Joseph Rowntree Foundation. You’ll start to find the answers to your questions there Joe. But there’s no substitute for bumping into the people behind those answers – up close and personal.
I’m curious to discuss this statistic some more. I’m not entirely sure it means much to say that ‘the gap between rich and poor has widened’.
What does it mean to live above the £44,000 barrier? What does it mean to live above the average wage? What does it mean to live on the minimum wage?
Who are ‘the poor’ and how are we measuring their poverty?