We need a national mission to transform the prospects of our worst-off people and places, says Campbell Robb.
We are in the decade of the political impasse. Two out of the last three general elections have delivered a hung parliament, and the 2015 general election gave the Conservatives a slender majority Theresa May felt she couldn’t work with. After Thursday’s shock result, we face another five years of stalemate where the country’s burning injustices are left untouched.
The Conservatives' attempts to win over seats in struggling Midlands and Northern towns failed to materialise, while Labour also fell far short of forming a government. Which begs the question, why?
After seven years, austerity and Brexit have dominated the political agenda and sidelined any meaningful discussion of important domestic reforms we badly need to see, never mind progress on them. The campaign contained too little debate of the issues that millions of people struggle with every day: making ends meet on low wages, the crippling cost of living, the struggle to find a decent, secure job and an affordable home.
Instead the offer was limited to a little bit off the energy bill here, a small tax cut there and perhaps some respite from rising train fares. For the 14 million people who live in poverty in the UK, daily life is typified by insecurity and impossible choices. Pollsters and strategists talk about a retail offer. But what we need is something fundamentally different. The political establishment seem not to recognise the day-to-day conditions holding millions of people back. So here’s what the next government must do.
First, allow families to keep more of what they earn so that work provides a route out of poverty. The Government’s flagship policy offer has been raising the tax allowance. But this is a costly approach that bypasses the majority of struggling families and mostly benefits better-off households. Further tax cuts should be targeted at low-earning families receiving Universal Credit, by increasing the amount they can earn before support is withdrawn.
Second, ensure everyone can get on at work. In Britain, one in eight workers are trapped in poverty. A shop worker or lorry driver over the age of 25 with few qualifications to their name cannot currently access public support to improve their skills, even if they are struggling to make ends meet and want to retrain to boost their prospects. This is vital if we are to drive up productivity, improve living standards and support people to find a good, secure job.
Third, kick-start a new generation of affordable homes. Social housing has not been common parlance in manifestos in recent years, but its inclusion this time was recognition that the country badly needs affordable rented housing for people who cannot buy. But new money is needed to deliver them. By linking rents to earnings, the Government could make housing costs genuinely affordable to low-income households working on the National Living Wage. This would mean topping up the affordable housing fund up to £3 billion a year to build 80,000 affordable homes a year at so-called Living Rents. Over the parliament, it could deliver 400,000 affordable homes, to rent and buy.
Fourth, ease the strain on families hurt by rising costs. This means ending the four-year freeze on working-age benefits and tax credits. Crucially, neither Labour nor the Conservatives committed to lift the freeze. This is systemically holding down the living standards of people on low incomes, both in and out of work, and is forecast to drive more people into poverty as they lose hundreds of pounds a year.
Fifth, rebalance national economic spending to help deliver inclusive growth across the country. Britain still bears deep scars from deindustrialisation, and employment levels still lag in many regions. In places like Greater Birmingham and Solihull, one in five of the workforce want a job or more hours. Yet existing patterns of government spending reinforce divides: Government investment per head on science and technology is 29% below the national average in the West Midlands. A fairer share of funding must be combined with a new wave of devolution deals and support for areas without mayors to kick-start growth.
There is much to do. But the alternative is a standstill generation in British politics, following a lost decade where little has changed and people’s prospects stagnate, or worse, fall backwards. Five more years of brick bats and soundbites over leadership and Brexit will not do. We need a national mission to transform the prospects of our worst-off people and places. The party that recognises these daily struggles and offers a radical plan to transform their prospects might be the one to finally win a majority. Only then might we end this political impasse.
This article was first published in The Times Red Box.