Tory Welfare Cuts to Target the Working Poor With Children

The Prime Minister, David Cameron, in a speech delivered in Runcorn yesterday began to reveal where some of the £12 billion cuts to the welfare budget will come from. In what he called a ‘merry-go-round’ of tax and benefits, he identified tax credits as one major area.

The Tories refused to say during the general election campaign where welfare cuts would fall, so this is the clearest indication yet of an area of the welfare budget to be targeted. Cameron went on to say:

“People working on the minimum wage having that money taxed by the government, and then the government giving them the money back, and more, in welfare. Again, it’s dealing with the symptoms of the problem, topping up low pay rather than extending the drivers of opportunity.”

At first glance, this seems to be a perfectly rational position to take, where tax is taken from low earners and then returned to the same workers via the tax credit system, appears to be an inefficient carry on. But tax credits were introduced by Gordon Brown when he was Chancellor of the Exchequer as a way of targeting money at the lowest paid and allowing extra for any dependent children.

Typically Brown like, tax credits are incredibly difficult to understand and are calculated via a computerised system where all of the relevant data is fed in. Basically, if you earn the minimum wage or a little above, you will qualify for tax credits, and if you have children you will get extra.

Despite the complex calculations involved in tax credits they are very good at targeting those on the lowest pay and boosting their income via payments from the government.

Critics on the left have argued against tax credits as a subsidy to employers to pay low wages, which is certainly the case. But at the end of the day tax credits do get money to where it is most needed.

The Resolution Foundation, a think tank that works to improve the living standards of low to middle-income earners, has analysed proposals to cut the value of the ‘child element’ of the Child Tax Credit back to its 2003/4 level, which it is rumoured the government intends to do. It suggests that:

 •Over two-thirds of affected families would be in-work

 •Families with two children would lose up £1,690 a year

 •Almost two-thirds of the cut would be borne by the poorest 30 per cent of households

 •Almost none of the cut would fall upon the richest 40 per cent of households

In a report written even before cuts to child tax credits were suggested the Institute for Fiscal Studies said that the number of children living in poverty has increased again over the last three years, from 2.3 million to 2.5 million.

Government policy is set then to increase poverty, particularly among those on low pay with children. This is denied by the government, although their alternative route to ‘prosperity’ is only vaguely explained.

Cameron instead said what he wants to ‘see is this move towards an economy with higher pay, lower welfare and lower taxes rather than low pay, high taxes and high welfare’.

But there was no commitment to increase the minimum wage, other than in line with inflation which is estimated to raise it to £8 per hour by 2020. It should also be noted that the government plans to introduce employment legislation to make it more difficult for unions to organise and to take industrial action.

So, how will the government achieve this high wage economy that the Prime Minister sees as the answer to cutting poverty? The invisible hand of the market perhaps, or maybe the tooth fairy?

It appears to be wishful thinking at best, or a cynical attempt at muddying the water on the issue at worst.    

Social Murder, Health and Safety, and Trade Unions

Guest blog from WH Quick, first published on his website 'A Green Trade Unionist - In Bristol' LINK
Published here because it has a much wider relevance.

 Early photograph of the last mass Chartist meeting of 150,000 at Kennington Common to deliver their final petition, allegedly signed by 6 million, 1848

The Chartists were the first mass working class movement in the world. They had local groups across the country; organised petitions signed by millions, and held mass demonstrations attended by hundreds of thousands in a time with much more limited communication networks and in an extremely repressive atmosphere.

Their strength came from the general revulsion at the extremely pronounced levels of injustice and exploitation inherent in the early factory system. The average working day was in excess of 12 hours, often in cramped workshops with few breaks and no health and safety standards. The employment of children was widespread. This practice came under increasing criticism from the 1780s but it wasn’t until 1833 that effectively enforced legislation was brought in to regulate child labour.

Boys working in a textile mill

                                                    

The 1833 act only outlawed children under the age of 9 (except in the silk industry) from working, and limited them to working 8 hours a day till they were 14 (and then 12 hours till they were 18). Workers received abject poverty pay, had no weekends or holidays, no maternity leave or sick pay or any real rights at all.  After a long day they returned home to squalid slum housing to subsist off of terrible diet of the cheapest food. As in the less wealthy countries of the world today (where the majority of our cheap mass manufactured goods are produced) rates of accidents, injuries and mortality were appallingly high.

 

The Chartists termed the tens of thousands killed and maimed in the all-pervasive industrial accidents of their era ‘Social Murder’. These were the thousands unnecessarily killed each year by a society structured to pursue profit no matter the human (or environmental) cost. Thankfully, due largely to the efforts of past generations organising in their workplaces, communities and in political parties, we now work in far safer and more humane working environments.

But even today in the UK around 1,500 people die in largely avoidable accidents in the workplace. A further 50,000 die prematurely every year as a result of long term I’ll health acquired at work. Many more are seriously injured. In my branch of UNISON (representing around 1,500 people) sadly in this last year alone one of our members has been left permanently disabled and another with serious long term health issues.

According to our Health and Safety officer Mark, both of these incidents were caused by actions worse than negligent on the part of management.  The drive to cut costs by minimising legislation and cutting corners, that can leave workers seriously disabled or worse, makes this kind of behaviour increasing likely in the UK today.

Rates of industrial accidents have been gradually rising over the last few years as both Health and Safety regulation and the budget of the agency enforcing them have been cut by the Coalitions.  For years now right wing comics and TV personalities – like Clarkson – have demonized health and safety and turned it into a joke. This works in much the same way that media demonization campaigns have paved the way for cuts to the wider welfare state in general. The way health and safety discourses are conducted – couched in the terms of the names and dates of the legislative framework that created it – can be tedious. But it is an extremely important part of workplace safety and the rights that the labour movement has won us over generations of struggle.

Whilst sectors of the media denigrate health and safety legislation, and the coalition government carries out savage cut, employers are going on the offensive. Bristol made national news when revelation of the extensive use of a black list of health and safety stewards and activists by leading Bristol construction companies came to light. To maximise profits by undercutting health and safety standards at least 3,214 health and safety activists (ordinary people concerned about their welfare at work) were victimized and had their ability to work and provide themselves with a living severely curtailed.  The list most famously was in use on the construction of Cabot Circus.

We don’t have to look to the past to see how the all-consuming drive to profit inherent in our economic system, when not tapered by strong unions and health and safety legislation, leads to misery. Our contemporary world is full of depressing evidence. The working conditions in the parts of the world where most of the Wests cheap manufactured goods are produced are atrocious. Rates of injury and death are shockingly high and reminiscent of our early industrial past. Often adults and children work side by side in appalling conditions.

We don’t like to think about this blood involved in the production of our cheap consumables.  Occasionally workplace conditions are so despicable an ‘accident’ of such awful magnitude happens and pierces the veil of silence carefully constructed around it.   As in 2013 when over 1100 people were killed and a further 2500 injured in Rana Plaza Bangladesh when a sweatshop producing goods for a consortium of western companies collapsed. Just before this disaster the building had been deemed safe twice by inspectors working on behalf of Primark.

Rana Plaza just after its collapse in 2013

We may not like to think about these extreme levels of exploitation and death inherent in the international trade system; but the role of western multinationals in setting up this very system to supply our domestic consumption patterns is central and makes us all partly responsible. Rana Plaza is a case in point. In the wakes of the disaster the International Trade Union movement created and signed an accord on minimum safety standards in the garment industries of Bangladesh and Cambodia.

So far only three American owned factories have signed up. We see the violence inherent in the system flare up as Western Corporation repressively extract resources all across the global south. Indigenous leaders are murdered as they try to protect their lands from invasive oil drilling. Workers striking for better wages and conditions are brutalised by police and private guards. The Marikmana massacre of late 2012 is the most vivid and bloody example.  38 strikers were killed and at least 78 more were wounded when security and police representing the London based Lonmin mining corporation opened fire on them. The revelation that most of them where shot in the back whilst fleeing make it all the more horrifying.

Armed police with the miners they’ve just killed

If we want to change this horrifying state of affairs, changing the way we interact with our economic system to become more ethical consumers is a step in the right direction. But small scale individual change is never enough. We need to organize in our communities, workplaces and political parties to protect our health and safety and our living conditions; and we need to push these organizations to restructure the economic system that causes so much global misery.

Unions are especially relevant in this struggle for the role they play in protecting conditions at work; their role in the international labour movements attempt to improve conditions in the global south; and their involvement in community campaign to protect health and the environment. This last point can be illustrated locally by the part played by unions (including UNISON I’m happy to say) in supporting Avonmouth residents successful campaign to stop the building of a biomass energy plant. Large scale Biomass energy production accelerates deforestation and climate change, and emits toxic dust clouds that seriously impact health and can cause cancer.

Finally, to commemorate the victims of industrial ‘accidents’ around the world every year we celebrate International Workers memorial day. This year on the 28th of April we’ll be marking the occasion with a march from unite the union’s Tony Benn house (setting off at 12:30 pm) to a wreath laying in Castle Park, and a talk in the evening. The message is remember the dead and fight for the living. Come along, join and get active in a union, and make sure you use your vote this May (there’s less than a week left to register).

Flyer for the Bristol Hazards Group International Memorial Day talk