Labour can't let its response to financial crisis descend into scapegoating of 'scroungers'

Tackling injustice must continue to be part of Labour’s DNA

Rachel Reeves’ chilling Spring Statement provides a frightening insight into the reality of the deepening financial and social welfare crisis facing the Labour government.

The current debate does, however, also raise wider, more serious and deeper philosophical issues: why should the poor and disadvantaged be hit so hard; why is a more equitable taxation system not in play, and why are alternative ideas not being explored? The government seems reluctant to engage with voters and offer a more hopeful, positive vision for the future.

Tough rhetoric is in danger of distorting or undermining deeply held and universally cherished beliefs which lie at the core of Labour’s values and creed. This will only unsettle people even further. If economic growth doesn’t materialise, what happens next?

Chancellor Rachel Reeves leaves 11 Downing Street on her way to deliver her Spring Statement to Parliament (Picture: Peter Nicholls) | Getty Images

UK is not over-taxed

In Europe, warfare is likely to overtake welfare as spending rises to cope with Russian aggression. This is understandable. Trump is destroying the international order. Germany has relaxed constitutional limits on expenditure to borrow more, but they have scope to do this.

Faced with the dangers of increasing government borrowing in this country, attention should be focussed on taxation of wealth, income and other sources. We have become conditioned to think that we are over-taxed in this country. We are not.

We are in danger of seeing “welfare scroungers” and “something for nothing” reappear in our political rhetoric. Welfare is being viewed with an outdated mindset. And the current state of public finances may get more critical as new and existing challenges upend our social and economic calculations.

In the delivery of any public service, efficiencies and improvements should always be an objective. But given £5 billion of welfare cuts, does Labour think that more stick is better than more carrot?

A national scandal

For example, nearly 987,000 aged 16 to 24 in the UK are not in employment, education or training, or ‘Neets’. The term wasn’t invented yesterday, possibly 25 years ago. This remains a national scandal.

Why do we think that cuts and a so-called harsher regime will solve the problem? They won’t, especially when colleges, community provision and local councils are being starved of resources.

Surely this cohort is essential for growth as conditions for young people become more complex and mental health becomes one of our biggest challenges of this faceless internet age. This is the worst time to be cutting services and undermining the universal idea of fairness.

From Bismarck to Beveridge

The origins of the welfare state provide valuable lessons which remain prescient today. Otto Von Bismarck, Chancellor of Prussia, is credited with creating an early example of a welfare system in the late 19th century, believing in support from the state, not as charity, but as a right. However, Hermann Beck, in his book on the subject, wrote of a “peculiar welfare state mentality of benevolence and patriarchal concern pervaded by authoritarian streaks” and the Protestant work ethic has remained integral to the welfare ideas of the political right in the UK.

In William Beveridge’s landmark 1943 report – officially entitled Social Insurance and Allied Services – he identified “five giants” to be tackled during reconstruction after the end of the Second World War. These were: Want, Disease, Ignorance, Squalor and Idleness.

The work ethic again was the backdrop to these remarkable and far-reaching times. Despite the terrible aftermath of the war, there was still a bold affirmation of the need to build a different kind of Britain where moral, financial, social, political and economic issues would have to be balanced. This was the era of John Maynard Keynes and the ideas of a regulated market economy with an active role for government intervention during difficult times.

It is worth noting that these “five giants” – referred to in different terms today – remain to be slayed, although improvements in each have taken place. Challenges remain but making progress on them should always be seen as integral to a decent, prosperous society, where the state and individuals enjoy mutual reciprocity and respect.

Get on your bike

Social welfare has had a turbulent political journey. From the days of the poor law, our welfare state has had its critics. The tags of “deserving” and “undeserving” have been deployed by politicians and parties for nearly a century. Speaking to the Tory Conference in 1992, Peter Lilley, the then Social Security Secretary, talked about “closing down the something-for-nothing society” and the need to tighten up on “scroungers”, and mocked poor people with a distasteful piece of poetry.

Norman Tebbit MP famously implied, when talking about unemployment and the work ethic to the Tory Party conference in the early 1980s, that people should get on their bikes to look for it, as his unemployed father had done in the 1930s.

Dehumanising ideas about scroungers and the dependency culture have remained clarion calls of the right. More recently Reform MP Lee Anderson said: “... when I was growing up in the 70s, that was real poverty… It’s nonsense now, it’s absolute nonsense. If you want something you can go and get it. You need to get off your arse and go and get it for yourself.”

Politics is the art of the possible

There is a danger that future elections will focus on scapegoats. Last time, it was migrants, but next time it might also be the allegedly work-shy, the lazy, the scroungers and benefit cheats. A country in a low and volatile mood could descend into a demeaning, lie-infested, Brexit-type national discourse.

The Chancellor has a tough job. The Tories left public finances and the economy in ruins. Treasury orthodoxy is suffocating common sense in relation to public services.

But tackling injustice must continue to be part of Labour’s DNA. Ministers must resist the use of ‘tough’, Elon Musk-style language. Shouting loudly or aggressively will not make the medicine or the message more palatable to the public.

Labour’s manifesto talked about change, but what does this mean and for whom? Choices and priorities lie at the heart of politics. It is still about the art of the possible.

Henry McLeish is a former Labour First Minister