Taking penury requires political will otherwise the poorest of the poor will become even poorer
Breaking with recent precedent, the official poverty statistics were last week without any press conference. It must be hoped that this reflected the chaos of political transition, as opposed to a loss of focus. Both wings of the coalition have laid great stress on deprived youngsters getting ahead at school, but both must understand that while children return to damp and cramped bedrooms to do their homework, many will continue to fail. The one overriding lesson of the Labour years, a lesson reaffirmed in the new data, is that tackling penury effectively requires obstinate political will. Labour made progress whenever it tried hard enough, and slipped back the moment it failed to.
The new income figures cover who got what in 2008-09, and so provide a near-final word on the Labour record. Taking the years since 1997 as a whole, average incomes rose at the same sort of rate as during the preceding Conservative years, the great difference being that Labour saw to it that the gains were evenly shared, whereas under the Tories there was a massive skew towards the rich. Sharing the extra money around in equal proportions is not in itself enough to actually narrow the gap, and this Labour singularly failed to do. But some sort of lid was kept on the underlying trend, thanks to tax credits that concentrated cash on the vulnerable young and the vulnerable old. In most years, including the latest, poverty inched down, and while the stretching targets were missed, international studies rate the record on children as exceptional. The elderly were always at special risk of penury, from the days of the poor law right through to the Rowntree studies and the founding of the welfare state. The Institute for Fiscal Studies, however, calculates that they are now no more likely to sink below the breadline than anyone else.
While Britain remains beset by a great gulf between the rich and the rest, these are mighty achievements, and ones giving the lie to rightist claims that Britain has for 13-years been subjected to a social democratic experiment which has failed. Indeed, the new figures caution against the priority that a state-sceptic coalition affords to taking the poor out of income tax. Fiscal 2008-09 is the year the 10p tax rate was axed, and yet the new figures show poverty dropped back. Complex expenditure measures proved of more use to the needy than their foregone tax perk, even though the complexity ensured no one noticed, and so the political poison was not drawn from the 10p tax row.
But if there are things to salute about the last 13 years, there are just as many to decry. There was malign neglect of what happened at the top end. Partially and belatedly corrected by the new super-tax – which came in too late for these figures – New Labour's intensely relaxed attitude to filthy riches created political space, which the Liberal Democrats deftly filled by posing as a moderate reincarnation of Robin Hood, with an election platform that stole from the rich in order to give to the middle station in life. The June budget will reveal how much of that has survived the haggling with the Tories, but already a signalled rise in capital gains tax gives grounds to hope that the coalition might just outflank Labour on the radical front, in relation to the rich. When it comes to the poorest, the omens are less encouraging. The first spending cuts to be announced today are a mere hors d'œuvre, and the Tory right is hoping to place the welfare budget at the heart of the main course. It hopes to save from the sick and the unemployed by toughening up already tough benefit regimes. This strategy, however, would mean punishing the childless poor, which is the one impoverished group that Labour has most consistently failed.
The politicians may at last have grasped that they can no longer stand idly by while the rich get richer, which is welcome. But it is surely even more important that they do not allow the poorest of the poor to become even poorer.