In what, exactly, are we together?

Tuesday 8 January 2013

The promised six-point plan for the second half of the Coalition Government's five-year term proved frustratingly lacking in detail as the Prime Minister and Deputy Prime Minister delivered their mid-term review yesterday.

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It was less of a relaunch than a stocktaking of what had been achieved so far. Both David Cameron and Nick Clegg emphasised the benefits of reaching across party lines to take difficult decisions. The most obvious of these was the highly contentious cut to child benefit (CB) which came into effect yesterday and the welfare reforms which will be voted on in the House of Commons today.

The changes to CB have been portrayed by the Coalition as a regrettable economic necessity to raise £2 billion a year and justified as affecting only the 15% of families who are better-off. In tough times, there is an obvious logic in taking from the wealthy to support the poor. Unfortunately for Government ministers, the real world is rarely so simple to set in order. The fundamental problem with the CB cut is that it is not fair. Households in which one parent earns £60,000 but the other earns little or nothing will lose all benefit while those with two parents each with incomes under the threshold but totalling £99,999 will retain their full entitlement. A more refined means test would be costlier to implement but there are additional problems with this hasty formula. One is implementation. Mr Cameron has acknowledged the need for practical delivery of policies. Yet many affected by the change (300,000 people by HM Revenue and Customs' estimate) have yet to be informed.More fundamentally damaging to the Government's welfare reform programme, however, is that reductions to other benefits claimed by those in work make the overall strategy look incoherent. The Coalition's Bill to uprate welfare benefits will cap CB, tax credits and statutory maternity pay at 1% for the next three years, less than the rate of inflation. This will leave those earning around the average wage, including many performing vital public roles such as nurses, primary school teachers and junior Army officers, significantly worse off, undermining the pledges to support "hardworking families" and make work pay. Politically, this is also in danger of becoming an own goal for the Conservatives because the changes will disproportionately affect women (who receive 75% of working tax credits), on whose support the party depends. Yesterday's announcement of support for childcare costs appears to be a belated recognition of this. Stay-at-home mothers, already penalised by losing child benefit if their partner earns more than £50,000, would gain nothing. Such a betrayal of traditional family values by a party which insisted on a tax break to underpin marriage in the Coalition agreement suggests a disastrous failure to relate to grassroots concerns.Many leading charities have made known their deep disappointment at Mr Cameron's failure to deliver the means to develop their role in the Big Society, which he envisaged before the General Election. The concept was a communication challenge but to alienate its natural supporters shows either ineptitude or a lack of conviction in the basic idea. The six-point checklist of policies announced yesterday, from help with the costs of childcare, making it easier to raise a mortgage, capping the cost of social care for the elderly in England and increasing the state pension to private investment in roads and extending personal freedoms is almost as nebulous as currently presented. Each new policy must be judged as details are announced but Mr Cameron's caveat that it has taken longer than expected to heal the economy was a reminder that the fiscal backdrop was the most clearly defined component of what lies ahead over the next half of this Parliament. In setting out the Coalition's big purpose as achieving a stronger economy in a fairer society, Mr Clegg also inclined to hope over experience. The message was: "Trust us, we know what we're doing." But on the very day the Coalition was re-emphasising its partnership, the unexpected resignation from the Cabinet of Lord Strathclyde, who has demonstrated a sterling capability as Tory leader in the House of Lords for 14 years, risks undermining a supposedly reassuring message on stability. With the economy still struggling, confidence is required and that is inspired competence. It should already be evident to both parties to the Coalition, and particularly to the Tory Work and Pensions Secretary Iain Duncan Smith, that it will take much more than a zeal for improvement and fiscal calculation to deliver the colossus of welfare reform. The changes to child benefit are relatively minor compared with the impending implementation of universal credit (UC) across the whole welfare system but hundreds of thousands of parents will now have to fill in self-assessment tax returns for the first time, resulting in additional cost to the Revenue. This will be dwarfed by the requirements of the IT system to implement UC, which will have to match employers' and banks' records to enable payments to be based on real income each month. The pilot scheme recorded a 25% failure rate in November, raising doubts not just about the timescale. The poor record of successive governments in commissioning major new IT systems suggests hasty implementation leads to disaster. Too many lives will be affected by UC to allow that to happen. Caution was the watchword on implementing austerity from an unexpected source yesterday. Professor Ngaire Woods, a former independent adviser to the IMF, warned that the experience of the past 20 years showed that austerity measures should be implemented slowly to avoid a vicious circle. Her caution should be heeded.Messrs Cameron and Clegg are in it together until 2015 but, without convincing policies, theirs was not a reassuring message to a public that wants to see real help with the rising cost of living rather than grand schemes which may not be implemented before the General Election, even if flesh has been put on the bones. When David Cameron announced, towards the end of last year, that the forthcoming G8 summit was to be held in Northern Ireland, he understandably said that the surprise choice of venue would be a chance to promote Northern Ireland globally. Indeed he could hardly contain his enthusiasm. The summit, this summer, would be "a brilliant advertisement" for the province, "an opportunity to let the world see what a fantastic place Northern Ireland is".Well, I don't want to be the party pooper, but these remarks are already looking seriously misjudged. Indeed the Prime Minister must be relieved the summit is not be held in Belfast; the venue, the Lough Erne Resort near Enniskillen, is about 90 minutes from Belfast by road.The continuing troubles in East Central Belfast are a reminder that in the province nothing can ever be taken for granted. The peace process is one of the few really genuine political success stories in the UK over the past 30 years or so, but we must remember that it is just that, a process. It is by no means complete. At the core of the current discontent is a militant and very angry group of working-class Protestants – or Loyalists , as some of them still prefer, mistakenly, to be called. Many, probably most, of them are young people who feel the peace process has simply passed them by. They think their "loyalty" to the British flag is being "rewarded" by a state which will give them no jobs and no prosperity and indeed no future. They have no meaningful political leadership, nobody in the mainstream who can speak for them and articulate their sense of grievance, their sense that their homeland of Northern Ireland is slipping away from them demographically, economically, and socially. They feel discarded. They see themselves as an unwanted group of people, marginalised and betrayed. To say the serious violence of recent weeks has been caused by the decision to fly the Union flag less often over Belfast City Hall is a bit like saying the four years of carnage and horror and waste that was the First World War were caused by an archduke being shot in Sarajevo. The fact is that there is, and has been for some time, a sizeable element in the Protestant community always likely to erupt in frustration and fury. Many of the more shrewd commentators in the province have been saying this, or something similar, for a long time. But few if any of the succession of mainland politicians sent over to be Northern Ireland secretaries were able to do anything to address the sense of alienation growing among working- class Protestants, particularly in areas with a paramilitary tradition. Such local leadership as there was in these areas often tended to be very hard line, predicated on a sectarian fight to the finish. Despite the very long, and largely wasted, political hegemony of the Ulster Unionists, there was always deep within the Loyalist mindset a pessimism, a suspicion of their leaders and a sense that they had sold them short and would continue to do so.And it was not just the politicians who were perceived as culpable. Many of the leading Protestant clergy were not genuine leaders. One of the most respected of them, Robin Eames, understood that in a context of violent paramilitary activity bound up with a criminal culture involving drugs, prostitution and much else, a kind of grisly vacuum would be created. Mr Eames felt that for such people the peace process was "away above their heads". They felt they were "irrelevant, and that all the attention was being given to Republicans". Of course none of that can excuse the deplorable violence that has erupted so often in the past few weeks. But that violence is a very pertinent reminder that while the lush fairways and plush cocktail lounges of the Lough Erne Resort may showcase the idea of Northern Ireland that David Cameron wants to promote, the reality on the urban streets, as often, is starkly different.

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In what, exactly, are we together?

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