Poverty & Welfare reform

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A presentation given at the Hallam Justice and Peace Commission in Sheffield on 1st March 2014 by Dr Simon Duffy. The talk describes growing poverty and inequality in the UK today, the negative impact of 'welfare reforms' and some of the real reasons why we are in the current crisis.

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Poverty & Welfare reform

  1. 1. Poverty & Welfare Reform The challenge on Sheffield’s Doorstep
  2. 2. You insult your Maker when you exploit the powerless; when you are kind to the poor, you honour God Proverbs, 14:31 If the present order is taken for granted or assumed to be sacrosanct, charity from the more to the less fortunate would seem virtuous and commendable; to those for whom the order itself is suspect or worse, such charity is blood-money. Why should some be in the position to dispense and others to need that kind of charity? Archbishop William Temple, from Christianity and Social Order
  3. 3. Some basic facts • • • • • UK is 7th wealthiest, but 3rd most unequal country Markets are useful, but they don’t reduce inequality or remove poverty, only we can choose to do that Poorest on benefits gets £56.80 pw, less than £3,000 per year, median earner c. £20,000, highest paid civil servant £200,000 Inequality is associated with a range of expensive social problems, including poor mental health, life expectancy and violence that harm everyone Sheffield ranks 38 out of 326 places in the UK in a measure of your risk of being in poverty
  4. 4. So, what is welfare reform? Child Benefit freeze Abolition of Sure Start Maternity for second children Changes to CPI indexation of benefits Reductions in support for carers Replacing DLA with PIP Child Benefit clawback from higher rate taxpayers Time-limiting of contributory ESA Transfer of Social Fund to local government Council Tax Benefit: 10% reduction and localisation Changes for JSA lone parents Housing Benefit: Under-occupation Household Benefit cap Abolition of the Independent Living Fund Continued use of ATOS or others Universal Credit Reductions in ‘Access to Work’ funding Closure of Remploy services Abolition of the Child Trust Fund Tax credit reductions Abolition of the Health in Pregnancy Grant Abolition of the Child Trust Fund Abolition of the ESA youth rules Housing Benefit: Non-dependant deductions Reductions in Supporting People funding
  5. 5. Biggest cuts in poorest places
  6. 6. Cuts target poorest & disabled people
  7. 7. The impact is only just beginning At the end of December 2013 there were 4120 council tenants affected by Under-occupancy. Of those approximately 85% were assessed as having 1 bedroom too many, losing an average of £10.21 pw; and approximately 15% were assessed as having 2 or more bedrooms too many, losing an average of £19.77 Of the 4120 tenants affected by Under-occupancy, at the end of December 2013: 241 (6%) had not made any payment towards the Under- occupancy cut in their benefit. This figure compares to 10% of tenants who had paid nothing towards the Under-occupancy cut in their benefit at the end of October 2013. 1874 (45%) had paid in full the amount of the Under-occupancy cut in their benefit. However, of those tenants who had paid in full, 649 have received a Discretionary Housing Payment (DHP) which has paid some or all of their Underoccupancy charge. Therefore 1225 tenants (30% of all tenants affected by the ‘bedroom tax’) have paid the shortfall in full without receiving a DHP. This figure has increased from 18% at the end of October 2013. 2005 (49%) had paid something but not all. At the end of October 2013 this figure was 55%. Since April 2013, 336 tenants have been awarded a rehousing priority to move to a smaller property. Of the tenants awarded a priority 262 tenants have stated this is due to the impact of welfare reforms. 87 tenants have had agreement to move, despite them having rent arrears that would normally have stopped them from being rehoused. So far 153 council housing tenants have downsized already since April. There are approximately a further 2,000 tenants in Sheffield affected by Under-occupancy who are living in other social housing.
  8. 8. In addition public spending is being cut
  9. 9. Without systems of collective security - welfare - human life descends into fear, terror, revolution and war.
  10. 10. Current crisis was not caused by excessive public spending, nor by welfare nor by disabled people. It was caused by over-lending (and private borrowing).
  11. 11. Public expenditure has changed little
  12. 12. The real cost of benefits (net of taxes) is minimal
  13. 13. Our debt crisis was fed by a housing bubble
  14. 14. To protect homeowners the government slashed the cost of borrowing.
  15. 15. Government is now subsidising the mortgages of homeowners at a cost of over £34 billion per year.
  16. 16. The poorest 10% of families pay the highest share of their income in taxes - about 45%.
  17. 17. There are only a tiny number of people who do not work for years - the vast majority of people go out and look for work.
  18. 18. Benefit fraud is dwarfed by fraud by taxpayers and fraud by government itself.
  19. 19. Benefit fraud is only 6% of tax fraud, yet it is covered by the news 600% more. The “Benefit Thieves” campaign was established by the previous Labour Government.
  20. 20. ‘Welfare reform’ is code for a redistribution of resources away from the poorest and towards the better off. ! In the competition for political power, politicians are taking care to ensure that they target benefits on swing voters: home owners, families with two employed parents, middle-income earners. ! The median voter is far more important than any other. The median voter determines who wins elections. We live in a medianocracy.
  21. 21. The use of stigma, shame and scapegoating is distracting us from the real issues.
  22. 22. Our problems were not created by disabled people or by people in poverty - they were created by the powerful and the wealthy Pruitt Igoe Urban Housing Project: 1952-1968
  23. 23. The current system is a complex net of taxes and benefits that nobody understands but which leaves people fearful.
  24. 24. The UK is the second most centralised welfare state in the world (after New Zealand)
  25. 25. We do not need to treat services as professionally defined gifts - we should have real entitlements
  26. 26. We fell asleep. We forgot that they don’t take care of us, we take care of each other. We forgot that it’s the rich who need the poor, not the poor who need the rich. We forgot that politicians work for us, we don’t work for them. We forgot that government doesn’t innovate, people do. We forgot that government doesn’t create wealth, people do. We forgot that government doesn’t know best, people do. We forgot about citizenship, we forgot about families, we forgot about community. We confused good with big. We confused achievement with wealth. We confused love with control. We forgot that the welfare state was made by us, that it belongs to us and it needs to work for us. It’s time to wake up.
  27. 27. We need a new settlement - a constitutional approach which protects our rights and shifts power to citizens.
  28. 28. Elements of a better system might include: • • • • • Human rights at heart of system Minimum universal securities as rights A fair and integrated taxbenefit system Individual freedom for all Families and communities respected and supported.
  29. 29. When I give food to the poor, they call me a saint. When I ask why they are poor, they call me a communist - Helder Camara
  30. 30. Britain is the world’s seventh largest economy and yet people are going hungry. Half a million people have visited foodbanks in the UK since last Easter and 5,500 people were admitted to hospital in the UK for malnutrition last year. One in five mothers report regularly skipping meals to better feed their children, and even more families are just one unexpected bill away from waking up with empty cupboards. We often hear talk of hard choices. Surely few can be harder than that faced by the tens of thousands of older people who must “heat or eat” each winter, harder than those faced by families whose wages have stayed flat while food prices have gone up 30% in just five years. Yet beyond even this we must, as a society, face up to the fact that over half of people using foodbanks have been put in that situation by cut backs to and failures in the benefit system, whether it be payment delays or punitive sanctions. On March 5th Lent will begin. The Christian tradition has long been at this time to fast, and by doing so draw closer to our neighbour and closer to God. On March 5th we will begin a time of fasting while half a million regularly go hungry in Britain. We urge those of all faith and none, people of good conscience, to join with us. There is an acute moral imperative to act. Hundreds of thousands of people are doing so already, as they set up and support foodbanks across the UK. But this is a national crisis, and one we must rise to. We call on government to do its part: acting to investigate food markets that are failing, to make sure that work pays, and to ensure that the welfare system provides a robust last line of defence against hunger. Join us at www.endhungerfast.co.uk.
  31. 31. The Church may not have all the answers... ! ! ! ! ! ! ! ! but it can ask the right questions.
  32. 32. For more information: ! Web: www.centreforwelfarereform.org ! Twitter: @CforWR and @simonjduffy ! Blog: www.simonduffy.info ! Facebook: centreforwelfarereform ! Campaign: www.campaignforafairsociety.org © Simon Duffy. Rights Reserved. Full copyright details at www.centreforwelfarereform.org

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