How Iain Duncan Smith has turned his back on the poor
More than a decade ago, Iain Duncan Smith toured a deprived housing estate in Glasgow. He was so moved by what he saw, he promised to tackle poverty. Today, as his welfare reforms bite and he refuses to appear in front of a committe at the Scottish Parliament to give evidence, Holyrood asks the man who showed him round Easterhouse whether the Work and Pensions Secretary has lived up to his pledge
Politics can often be characterised as a journey. None more so than that undertaken by Iain Duncan Smith, who visited Glasgow’s deprived Easterhouse estate 11 years ago.
A religious man, it would probably not be unfair to describe the trip as a kind of pilgrimage, as Duncan Smith sought to rebrand the Tories as a party that cared.
But fast forward to 2013 and the man who chaperoned the former Conservative leader around those bleak low rises – and introduced him to its residents – feels let down.
Bob Holman, a lifelong Labour Party activist, social worker and poverty campaigner, is not only upset that Duncan Smith is implementing a controversial welfare reform programme that risks undoing a decade of social progress in Scotland, he is also angered that the ‘skivers’ and ‘shirkers’ rhetoric has been allowed to flourish under the minister’s stewardship of his work and pensions brief.
We sit in the TV room at FARE – Family Action in Rogerfield and Easterhouse – a community centre which opened in 2010 thanks to a long fundraising campaign. Holman tells Holyrood: “The very people who we met in Easterhouse – and he was impressed by their abilities and their commitment, the unemployed, the single mums – he’s now criticising them as being ‘shirkers’ not the ‘strivers’. It came from Osborne but it’s been supported by him. He’s talked about people who don’t want to work and he’s put in the punishments, people can be made to work for nothing or you’ll get your benefits cut.”
Holman – who Duncan Smith has described as a “living saint” – vividly recounts that seminal visit.
“The Tories phoned up, the Central Office, and said, ‘would you mind a visit from Iain Duncan Smith, our new leader?’ And I said, ‘why does he want to come here?’ ‘Well, we’re interested in compassionate conservatism.’ This was at a time when the Tories were realising they had to change their hard image.
“The chap who did it – who arranged it – was Tim Montgomerie [now editor of the Conservative Home blog]. He was his right-hand man, at that point.”
Holman explains that he wasn’t averse to a Conservative politician visiting as FARE was constitutionally apolitical.
The visit itself, which attracted a great deal of press interest, went well, Holman adds.
“They came up and he’s very polite. He came in and we chatted away. He was good at talking with our volunteers. There was nothing like ‘I’m superior’ with him. And afterwards he said to me, ‘these people on your committee, a single mother, two unemployed people, these are the very people that Maggie didn’t like’. Maggie being Maggie Thatcher. And I think he began to see that ordinary Easterhouse people have got abilities. They can run organisations. And we then went on a walkabout and we finished up at the Baptist church, by the way. We just went through the streets and looked at the housing. In those days, it was worse than now, it was pretty grim, and I remember he looked up at one house and the chap looked out the top window. And he said, ‘what’s it like living here?’ ‘Rubbish,’ he said, ‘would you like to live here?’ -because it was a very overcrowded flat. And then he saw a druggie’s needle in the street and he was absolutely horrified at this. I don’t think he’d ever seen one before. ‘What if a kid picked that up?’ ‘Well, they’d probably know not to pick it up’.”
Politicians are often criticised for parachuting into such environments, opportunistically getting a few snaps with ‘locals’ and then disappearing without a trace.
But Holman is quick to give credit where credit is due. In Duncan Smith’s case, it was not just a flying visit. He made the effort to stay in touch and came back on several occasions – even after he was ousted as leader. That made a distinct impression on Holman and led him to think that Duncan Smith’s commitment to addressing poverty was more than just a cynical ploy for votes.
“He could have gone to the House of Lords or picked up a few consultancies and that’s him made for life. But he didn’t. Instead he set up the Centre for Social Justice, which is concerned particularly with voluntary groups. And to my surprise, he kept in touch with us. He didn’t want publicity. He’d come up sometimes, he’d phone up. And he visited a group of mothers or parents who, one of their youngsters had died of a drug overdose or drug abuse of some kind and he was very interested in this. And one of the women, she lost a second son, who was found killed, found drowned – he obviously had had drugs and fallen into the water – on the day of the funeral, he phoned me up and said, ‘I’m coming to this funeral, I’ve got to get back today because I’m in the House of Commons but could you meet me at the airport?’ So I met him, took him to this funeral and what I must say is that he was so good with this woman. He was compassionate and comforting and – despite his background – by this time he’d learnt to communicate with working-class people – he was walking around the room talking to them all. And then he went back but he had one condition. He said: ‘I don’t want any publicity for this, I’m not doing it to be in the news; I’m doing it because I’m interested in this woman.’ That really impressed me.”
Although his politics were of a very different hue, Holman accepted an invitation from Duncan Smith to speak about poverty at the Conservative Party conference in Bournemouth.
Holman says he was well-received by the audience but has a bone to pick with Duncan Smith, who he says pledged to make it easier for local charities to get money from national government, lamenting: “He’s forgotten it now.”
In 2005, Holman reciprocated and invited Duncan Smith to the Labour Party conference in Manchester.
“No senior Tory had ever been to a Labour conference and he agreed to come to a fringe meeting organised by the Christian Socialist movement and I was to have a debate with him about poverty.
“He spoke first and as he spoke, I thought, ‘what am I going to say because this was what I was going to say’. There were two main points in his talk – one was that the Labour Party was still using the conventional definition of poverty: under 60 per cent of average earnings. And he said that’s not enough and ‘everybody should have enough money to live properly in their community’.
“The second point he made was that, I must blame the Labour Party because inequality has increased; there’s a larger gap between the rich and the poor under Labour. And he said, ‘at some point we’ve got to redistribute assets; not just income’. This is radical stuff, so I didn’t know what to say when I stood up. Land, houses, wealth, even Labour never talks about that. He was obviously still a key figure in the Conservative Party. If he becomes minister of social security, or whatever they call it, we’re in for a radical time.”
So it will come as little surprise– since the Coalition was formed in 2010 – that Holman has been so disappointed in what Duncan Smith has delivered in office.
Rather than redistributing assets to the poor, there are fears that the much vaunted welfare reform programme risks reversing the fortunes of those supported by benefit entitlements.
The rolling up of six benefits into one, in the form of Universal Credit, is a welcome simplification on some fronts, with Westminster insisting three million households will be “better off”.
But the Government’s own Work and Pensions Minister, Esther McVey, has accepted: “The up-rating [increased by 1 per cent each year rather than inflation] measures in 2013- 14, 2014-15 and 2015-16 will result in around an extra 200,000 children being deemed to be in relative income poverty compared to uprating benefits by CPI [consumer price index]”.
Research carried out by the New Policy Institute, on behalf of the Joseph Rowntree Foundation, points out that in the decade to 2010/11, the child poverty rate in Scotland fell from 31 per cent to 21 per cent (after housing costs).
Its ‘Monitoring poverty and social exclusion in Scotland 2013’ report also indicates, however, that the number of unemployed under-25s has almost doubled to 90,000 since 2008. And crucially, it shows the number of working-age adults in poverty remained unchanged in the last decade to 2010/11.
And a paper prepared by Jim McCormick for the Scottish Council for Voluntary Organisations warns: “By 2020, the Institute for Fiscal Studies (IFS) expects child poverty to have returned to the level last seen in 1999, when devolution began. Substantial progress in cutting child poverty in the first half of the previous decade (and even the stalled position in recent years) will be undone.”
Universal Credit replaces Income Support, Jobseeker’s Allowance, Employment Support Allowance, Housing Benefit and child/working tax credits, while responsibility to discount Council Tax is being passed to devolved administrations and local authorities in England.
The IFS indicated that Universal Credit should lead to 450,000 fewer children and 650,000 working-age adults in poverty between 2015-20. However, it said that 200,000 more children and 300,000 working-age adults would be poorer if benefits only rose in line with the CPI. With the rise capped at one per cent – beneath both the CPI and Retail Price Index – the situation is likely to be even worse, the IFS warns.
McCormick also points to other “design flaws” in the legislation, which could, for example, see those losing some housing benefit because of the under-occupancy rule, the socalled ‘bedroom tax’, being forced to look for a new home in the private rented sector.
He tells Holyrood: “The unintended consequence of the under-occupancy rule is potentially higher, not lower, costs because they’re unwilling to intervene in the private rented market.”
When asked if the Government risks falling into the classic ‘robbing Peter to pay Paul’ trap, McCormick adds: “Absolutely, especially in places in Scotland where either rents are very high – in parts of Aberdeen and Edinburgh and Glasgow or in areas where there is very scarce supply, in rural areas as well.
“There are a number of significant design flaws, probably the most important of which is the shift from individual to single household payments, which although not necessarily important in most households, we know that there are households where, because of the relationship status, the vulnerable ones in particular, may be in a more difficult position in terms of income security, and monthly payment arrears is problematic because of what we know about weekly and fortnightly household budgeting.”
McCormick, who is also Scotland Adviser to the Joseph Rowntree Foundation, does concede that Universal Credit will make work a more attractive proposition as people get to keep more of the money they earn.
At the moment, recipients lose about 90p of their benefit for every pound they earn above the first £20 in a week.
Under Universal Credit, that will reduce to about 65p, which should provide more of an incentive to look for employment.
“There’s an improvement to that extent but the overall problem, though, is that all these positive features are more than undone by the decision on up-rating. That is the single biggest issue as to why we’re looking at increasing poverty, not reducing it,” McCormick explains.
However, not all are convinced that the reforms to welfare – which come in April and October – will result in failure.
While the DWP has no specific forecasts for Scotland – in ‘real terms’ of the annual benefits bill over the next few years – a UK-wide projection shows it will stabilise at around the £163bn mark.
And as a share of GDP, the forecast indicates spending will reduce from 10.4 per cent to 9.3 per cent in the next five years.
If the forecasts are accurate, that represents an achievement compared to the five years between 2005/06 and 2010/11 – when it went up from £135bn to £159.9bn.
Alex Johnstone, Conservative MSP for North-east Scotland, tells Holyrood the reforms will help Scotland break the cycle of welfare dependency.
“The level of benefits and the cost-related elements are an important step towards balancing budgets. The key element in the Scottish context or, let’s say the comparison between Scotland or the experience of Scotland, is that there seems to be a deepseated view in the Scottish context that the right amount of benefits to be paying people is more in general. And this is based on a peculiarly Scottish attitude that welfare dependency is somehow a positive or desirable thing rather than a negative one. The objective of the welfare reform programme is to effectively make it easier for people to get into work and, as such, that has the additional knock-on effect of reducing overall welfare budgets in the long term. But it also has the much more positive effect of ending the cycle of welfare dependency, which so many people have found themselves in.” But when asked whether the real issue is low wages – given seven million people in receipt of benefits or tax credits across the UK are actually in work – Johnstone says he is attracted to the idea of a ‘living wage’.
“On the exact issue, the living wage as opposed to the minimum wage, I support the broad principle of the living wage and I’m very keen to look at ways we can achieve that objective over time, perhaps not using the terminology of the Left but certainly with a broader shared objective.
“I’m attracted to the idea of making, of getting to the stage where we have an economy that can sustain that, but we have some very strange forces at play in the Scottish economy.”
But does he accept – if, as the IFS says and the Government itself seems to concede, that more people will become poor as a result of the changes – that the welfare reform programme will be deemed a failure?
“I believe that it is essential to our long-term wellbeing that we have a reform to the benefits system. What worries me, if we can take this at a slightly different level, is that there are a surprisingly high number of interest groups within Scotland who have an interest in ensuring that this reform process fails.
“If you look at it at a party-political level, the current government in Scotland do have a vested interest in ensuring that the welfare reform process fails because of the belief that they will capitalise on that in the referendum next year.”
Surely that’s a cynical view, though, to suggest that the SNP would deliberately wish to see people suffer to press its case for independence?
“That sounds like a cynical view and I would be delighted if they were able to prove me wrong. I also speak to large numbers of organisations within the voluntary sector who have failed to keep up with the pace being set by local government in Scotland, for example, in terms of finding ways to make the reform process work. And those within the voluntary sector need to motivate themselves to ensure that this process succeeds and that it doesn’t result in people being disadvantaged, necessarily. The bottom line in all this is that I believe the best form of welfare is work and that we need to be working to get people back into work. If it can then be demonstrated that there are significant problems in certain geographical areas with that process, then radical new steps will have to be taken in order to ensure the opportunity for work is made available in these specific areas. But at the moment we need, across the board, we need to focus on making this a success; if the priority is to make it a failure then there will be victims.”
For Holman, it all comes down to how unfair and unequal he sees society.
Already he talks of parents in Easterhouse being unable to send their kids to a camp to give them a holiday, other children being forced to cut down on once subsidised music lessons at school and the price to hire football pitches going up.
He also talks of a member of his community Baptist church, admittedly not well-qualified, who applies for jobs every week, with no success, and therefore faces having his benefits cut because of the length of time he’s been out of work.
Food parcel relief also went up to 900 this Christmas, from 600 the previous year.
And he dwells for a moment on the case of two friends – both carers – who are being subjected to ‘zero hours’ contracts with private agencies, who have no security of employment and only get paid for hours spent with clients.
“So they travel into work – they don’t get their fares back, unlike MPs – and when they get to the workplace they sit, and all this time, they’re not getting paid until some work actually appears. And you go and do this job, you bathe an old person, and then you come back to the office, but you only get paid for the amount of time you’re actually working with that person. It’s a zero contract, they don’t say you’re going to have this employment for three years, they don’t say, the contract is issued by the outsourced carers’ organisations, private companies. Again, for instance, you don’t get paid holidays, you’ve got no security of tenure, and you usually get minimum wage. However, some pay below the minimum wage and the employees are too scared to protest as they might lose their jobs.”
Despite everything, Holman has kept in contact with Duncan Smith since he became Work and Pensions Secretary and they met again at the House of Commons last July.
This time, Holman explains, the atmosphere was different, with Duncan Smith on the defensive.
“I went down to the Commons. Nice cup of coffee; he’s very polite, he’s always very nice. Two things came out of this. The first thing he said was, ‘I’ve got to make cuts because Osborne has continuously reduced the welfare [budget]’ – the welfare money, the money that Iain Duncan Smith gets to run it, therefore, I think he’s found it very difficult to get his Universal Credit at a level which will take people out of poverty, which obviously he’s not going to do now. The second thing was that I tackled him over his promise that locally-run groups like ours would get money directly from government. I said, ‘you’ve promised that, you’ve told me, it’s been in the press’. And, well, he says, ‘it’s your fault’. ‘My fault,’ I say. ‘Yes’, he says, ‘it’s the Labour Party’s fault for leaving the economy in such a mess, we couldn’t do it.’ Although, in fact, the amount of money it would cost is pretty minimal. He hasn’t pursued it; he’s just dropped it. We agreed to differ but at the end I was saying to him, ‘you should resign and outside of being a minister, you should be campaigning for the things you used to say’. And, as I went, he said, ‘perhaps you’re right’.
But did Holman get a sense that Duncan Smith felt any sort of shame for the programme he has carried through?
“I think that he’s got a mixture of feelings. I think he must feel disappointed that he hasn’t been able to tackle poverty and he must feel … ashamed is maybe too strong a word, he’s trying to balance his loyalty to his party with his commitment to the poor. And in my view, they can’t be balanced. You’ve got to come down on the side of the poor.”