How food banks trump the welfare state

On the face of it, the figures are damning. Food banks in Britain helped over 900,000 people last year, up around a third over the year before. It seems Britain has a real problem with food poverty. Our benefits system just isn’t coping.

But, like so many media headlines, the truth is a lot more subtle. Nearly all food banks in Britain are run by a single Christian charity, the Trussell Trust. In the last few years it has found a niche, sharpened its act, and opened a lot more. So not surprisingly, care professionals have been sending more people along. It may not be that the underlying problem is getting worse, just that it is being better served.

Nor is it the government’s benefit reforms that explain the rise. Food banks were growing long before the measures were passed in 2013, and many of the reforms have not even been implemented yet. And by merging scores of benefits into a far simpler universal benefit, the reforms should hopefully help ensure that people do not in fact fall through the gaps in the over-complicated welfare net.

The underlying problem that food banks help solve is not food poverty, any more than it is shoe poverty, clothes poverty, electricity poverty or water poverty. It is the temporary crises that people sometimes get into when they are unemployed or on low pay. Around 60% of food bank users are once-only users. They hit a crisis and can’t afford the groceries; that is why care workers refer them.

Around 30% of them have problems because their benefits payment has not arrived in time, or they are being penalised for not showing up at interview, or they have simply filled in a form wrongly. And you can blame that on our over-complicated, bureaucratic, distant and unfeeling state benefits system. We spend £94bn a year on it, a seventh of all government spending (and the government spends a lot). If we devolved the process to local communities and voluntary groups, it would work much better.

No government can do much about the fact that food prices have risen nearly 35% since 2007. Well, actually, they could stop subsidising biofuels, which has diverted huge amounts of agricultural produce out of human mouths and into gasoline tanks. And they could do something about the fact that other essentials have been soaring in price too. Government-mandated to renewable energy adds about 15% to the fuel bills of businesses and private sector organisations, plus about 6% on the gas bills and 11% on the electricity bills of domestic customers. That is why poorer people run out of cash and economise by going hungry.

Nearly everyone in Britain is well fed – some too much so – because Britain is a peaceful, trading nation with an established rule of law. Our farmers are not afraid to plant crops in case they are stolen by thugs or invading armies. Our traders bring produce to us from all over the world. If you want to see chronic poverty, look at countries that do not have this thriving market system.

Because this market system makes us a rich country, we can afford to help people who run into problems. The biggest philanthropic sector on the planet is that of America, the world’s richest country. In fact, America, Canada, New Zealand all have large food bank movements. That is because they are rich, and because they have a strong sense of community too. In Britain, too much of that sense of community has been crowded out by our state bureaucracy.

It is actually good to see charities taking on these problems. The state is inevitably large and lumbering. Private charities are much better at tackling individual human issues, like families who run out of cash from time to time.

Of course, the state could help in a very simple way. A large number of people referred to food banks are actually not those on benefits, but people on minimum wages. The government has pledged to take everyone on minimum wage out of tax, and about time too – it is absurd to tax people who are on the breadline. And yet we are still charging them and their employers another, hidden tax, namely National Insurance Contributions. Again, it’s crazy. If you want to help people in poverty­–and get people into the world’s best welfare programme, namely a paying job–you should be making work pay, which for many of the nation’s poorest, is appallingly not the case.

A reminder to Bill of Rights drafters: all we need is one right

“It’s not just the European Union that needs sorting out,” UK Prime Minister David Cameron told his Party Conference this week, “it’s the European Court of Human Rights.” This is not the first time he has said that: he said it to the judges’ faces a couple of years back, at the ECHR’s gleaming headquarters in leafy Strasbourg. They were not overly impressed. But his audience this week thinks he is spot on, and most people in the UK probably agree.

The ECHR is not an EU body but emerged out of the postwar European Convention on Human Rights. In other words, no Parliament agreed to it, no British citizen voted for it, no Prime Minister signed a treaty authorizing its power. Like Topsy, it ‘just growed.’

We are all in favour of human rights, of course, but countries disagree on exactly what those rights should be and how they should be enforced. The UK, in particular, has a very different legal tradition from other European countries – one that has served them a long time, and which they are justly proud of. But being empowered to overturn the decision of the courts in the UK and other countries, the ECHR is effectively imposing one legal regime – a judge-led regime – on everyone.

But why do we want the law of different countries to be identical? We can learn a lot from different countries running their affairs in different ways, then looking to see which way is preferable. Imposing a single legal view on a large number of countries prevents that learning from taking place.

And why should an unelected body deign to override the decisions of different countries’ courts and legislators anyway? Originally, the plan was that the ECHR would simply influence governments to ‘do the right thing’. But now, though it has no democratic legitimacy, it can override the decisions of UK courts and elected UK representatives. So in effect, law is being made by ECHR judges, and countries like the UK are bound by its decisions. That, as Lord Judge pointed out, gives us “a very serious problem with sovereignty”.

That is a particularly serious problem when a country thinks that its entire security is at risk. More than once, the ECHR stopped the deportations of suspects to face serious charges, including terrorism and genocide charges, to face trial overseas. Indeed, the ECHR has stopped deportations of foreign nationals already found guilty of serious offences abroad. Often, the grounds for such decisions have been the UK family ties of the accused, or their ‘right’ to the UK’s generous healthcare system. But what really got ministers’ goat was the Court’s blocking, for a long time, of the deportation of the radical Abu Qatada, wanted on terrorism charges in Jordan.

So now, the UK is to have its own new Bill of Rights, passed by Parliament. Actually, our old one, dating from 1689, has served us pretty well. I only hope that in drafting the new Bill, ministers do not fall for the nonsense perpetrated in the postwar settlement – things like the ‘right’ to free education. Because every right is someone else’s responsibility to provide. You can be sure that every lobby group will be out there, campaigning for ‘rights’ to this or that or the other, all at taxpayers’ expense of course, to be included in the Bill.

But in fact, all we need is one right – the right to be left alone without other people, and especially governments, pushing us around.

If Mr Cameron calls, I will gladly give him a draft.

The end of an auld West Lothian song

The Scottish National Party leader Alex Salmond loves causing trouble (as many contemporaries of mine from the University of St Andrews relish as well). He must be grinning, because despite losing the independence referendum in Thursday, he has really put the Westminster politicians in a stew.

Before the vote, to buy off wavering Yes voters, all the main political parties in Westminster signed a pledge to give more powers to Scotland anyway. On Friday, UK Prime Minister David Cameron correctly declared that if Scotland was getting more power, then people in Wales, Northern Ireland – and particularly England, the only bit of the UK without devolved powers – would expect nothing short of the same.

He is right, even if that reality only made itself plain after the more-powers pledge had actually been signed. And having set the idea running, he realizes that he has to initiate a House of Commons vote on English devolution before the June 2015 UK general election.

Labour leader Ed Miliband is currently refusing to back any such plan, calling it a ‘back of the envelope constitutional change’. He has a point: Westminster politicians are remarkably cavalier about how they change the UK’s constitution. A small public company cannot change its rules just on a majority vote of the directors, so why should a large government be able to change its rules on a simple majority in Westminster? But his real concern is to ensure that the large number of Labour MPs that Scotland sends down to Westminster can still vote on everyone else’s business, the ‘West Lothian Question’.

The impish Alex Salmond will be chuckling at the stooshie he has created. Some say we should devolve powers down to the English cities and local authorities. Others say we need a proper English Parliament. A few talk about barring Scottish MPs from voting on English-only laws.

But devolution of power to the local authorities is a non-runner. We have been promised it for decades, but it has never really happened, and nobody trusts that it will now. As for an English Parliament – well, we have seen the expense of the Scottish one (the extravagant building alone cost ten times its original estimate) and its notoriously poor quality (stuffed, inevitably, with failed local councillors and superannuated MPs).

The simple solution to devolution, all those years ago, would have been to form English, Scottish and Welsh parliaments out of their respective Westminster MPs; and have them meet at Westminster in the mornings on their own country business, then together on UK business in the afternoon. Yes, there will be a few arguments about which matters are ‘UK’ and which are ‘English’. But the solution is costless, and without adding an extra tier of government, you get home-grown politicians of some quality deciding home-grown issues. It is the obvious solution for England. And the end of an auld West Lothian song.

£8 minimum wage hype: political trick, economic disaster, moral outrage

Britain’s Labour Party leader Ed Miliband says that a Labour government would boost the national minimum wage to £8 an hour, an increase of about £60 per week, by 2020. He says the UK economy is booming, and the low-paid should get a bigger share of it.

Actually, at present rates of growth, the minimum wage will be close to £8 in 2020 anyway, so this is a one of those political sensations that doesn’t amount to much. Even so, it is foolhardy now to commit UK businesses to pay any specific figure in 2020, since anything could happen in the meantime.

The minimum wage gets unthinking politicians (and not just Labour leaders) dewy-eyed. ‘We can’t have people being paid a wage that isn’t enough to live on.’ ‘Businesses should pay their workers more, and take less profit.’ ‘The minimum wage hasn’t killed jobs as the doomsayers say.’ You know the story.

In fact, high minimum wages do destroy jobs. in particular, they destroy those starter jobs, the low-paid, temporary jobs that once gave young people their first step on the jobs ladder – pumping petrol (as I did), stacking bags in supermarkets, ushering people to their seats at the flicks. Now those jobs don’t exist, because they are not worth the minimum wage (plus all the National Insurance and the burden of workplace regulation that goes with them – a particular burden on small firms). So we have a million young people out of work.

As for profit, try using that argument on anyone running a small business, already weighed down by taxes, rates, and regulation. Often they are getting less than their lowest-paid employees, and working longer hours for it Higher minimum wages mean they can afford to employ fewer people, or provide less generous perks and conditions.

I don’t want to live in a country where people can’t afford to live on what they take home either. That is why we have a welfare system, to top up the earnings of the lowest paid. We need a negative income tax – above the line, you pay tax, below the line, you get cash benefits – structured so that you are always better off in work than out of it. A paying job, even a low-paid job, is the best welfare system the human mind can devise.

And we must take low-paid people out of tax and national insurance entirely. Then more small firms could afford to take on more low-skilled workers and give them that first step on the jobs ladder.

If we could simply vote ourselves higher pay, why stop at £8? Why not fix the minimum wage at £800 an hour. The answer is obvious. The only people who would be worth that amount to anyone would be a few Premier League footballers, rock stars, investment bankers and high-class hookers. The rest of us would be out of a job.

The minimum wage does no harm to people who are already earning it, though it does them no good either. But it does positive harm to those earning less, or those who cannot get a job at all. The former will be let go, or will have to endure worse conditions; the latter will find it very much harder to get a job. And all that, of course, has already happened.

Learning from history

In the Keystone Cops comedy that is the contending parties in the Scottish Independence referendum campaign, it seems that the Scottish No team have been making all the same mistakes that Canada’s No team made on Quebec independence back in 1995.

True, the Quebec referendum campaign ended in a narrow No decision – but so narrow that it kept the independence issue alive and grumbling. Next week’s Scottish referendum has become too close to call, but most polls are predicting a No majority – though again, one so narrow that it keeps the independence issue alive and grumbling here too.

It seems the No team have learnt nothing from Canada’s experience of nearly twenty years ago. Andrew Coyne of the National Post lists the similarities:

  • The same early complacency in the No camp.
  • The same unbridled panic as the Yes side surged in the polls.
  • The same unappealing mix of threats and dubious accounting claims.
  • The same blurring of the issues (devo-max, keeping the currency).
  • A charismatic Yes leader and a seemingly distant No Prime Minister.

As in Canada, says Coyne, an unwarranted legitimacy was conferred on the separatist project; then came attempts to pacify it with more powers and more money, only to see it grow more ravenous in response. And once again,  a Yes vote is probably forever, while a No vote just marks the start of fresh campaigning.

It all looks like one of the slow-motion car crash in those early comedies. Except this particular farce is deciding the UK’s future political and economic reality.