The poor always ye have with you, St John’s gospel tells us. Perhaps that thought prompted John Moore, once considered to be a future Tory prime minister, to reject the notion of relative poverty. He declared that poverty — in the sense of destitution — had disappeared from Britain.
That was in 1989. Moore believed that the notion of relative poverty had been devised to gainsay the success of capitalism. Maybe he had in mind the nagging voice of Polly Toynbee, The Guardian’s social commentator. If poverty income is defined as at or below 60% of the average, you can never “win”. There will always be lots of people at that level and they will be described as poor, however far above subsistence their incomes are and even if they are rising.
David Cameron explicitly accepts that his party needs to attack relative poverty. In a clever piece of groundwork before the leader’s speech on Friday, Greg Clark MP endorsed Toynbee’s image of a desert caravan moving forward. Rich and poor may all be making progress but the distance between the group at the rear and the rest matters. Clark asked his party to go well beyond Winston Churchill’s pledges merely to provide a ladder of opportunity and a safety net for the poor.
In truth the references to Toynbee and Churchill are overdone, although they served to get the media’s attention. The Tories have accepted a single example of Toynbee’s imagery rather than her entire collected statist works. The contrast that Cameron wishes to make is not so much with Churchill — who was a creator of the post-war consensus — as with Moore and Margaret Thatcher, his boss. Clark readily admits that relative poverty increased sharply under her.
That frees him to point to Labour’s failings. Tony Blair has taken careful aim at a group in society surviving just below the 60% line. By improving their incomes a little bit, Labour can claim to have removed 750,000 people from “poverty”. The careful targeting of money at one “cohort” produces a good headline despite the fact that overall inequality and poverty have not changed much.
Indeed, poor people remain poor for somewhat longer under Labour than before and there are about 750,000 extra poor people at incomes of 40% of the average or below. So if 40% rather than 60% were taken as the benchmark (and why not?), then “poverty” would be increasing under Blair.
There are lies, damned lies and targets. Also, the government’s claims that 1m — or even 2m — children have been taken out of poverty depend not on a relative measurement but an absolute one — that is, a Moore definition rather than a Toynbee one.
Meanwhile, there are many more rich people than there used to be. The Tories in office were heavily criticised because a few leaders of former nationalised industries — the “fat cats” — were paid salaries well into six figures. Today bonuses of more than £1m are commonplace.
One of the reasons why some poor are a little richer and some very poor a little poorer is that Gordon Brown’s main instrument of redistribution is tax credits and they are directed at people in work. The Tories have often attacked the scheme for being over-complicated and badly administered, but they accept the principle of supplementing the pay of poor people and giving extra amounts for each child. The first scheme to help families in work was introduced in 1971 by the Conservative minister Sir Keith Joseph (incidentally, the John the Baptist of Thatcherism).
The limitation of tax credits is that they do not help those without work. While unemployment has slipped from the headlines, there remain large numbers who are incapable of holding down a job because of drug problems, antisocial behaviour or because they lack all motivation and self-discipline. Redistributing more money to them could help the statistics but not change the reality of their colourless and unfulfilling lives.
For that reason the Tories talk about a range of policy options other than higher benefits. It is those people’s lack of education, the breakdown of their families, their mental illness or their drug addiction that needs to be tackled. All of which is easier said than done.
At least it gives the Tories a distinctive position. Since Cameron believes that there is such a thing as society, but it is just not the same as the state, he would rely heavily on the voluntary sector for work that must be carried out at the grass roots.
On the other hand Labour still looks to government action. Last week it advocated educators who could improve poor people’s parenting skills. It is a fine example of the nanny state, perhaps, but given that social exclusion and antisocial behaviour pass down through generations, I would not be too quick to mock the idea.
Over centuries the middle classes have worried about poverty from a mixture of compassion and fear. Inequality weighs on our consciences but it may also be dangerous. The well-off are mugged and even murdered by psychopaths and drug addicts in crimes that naturally shock us deeply. Before becoming prime minister Blair talked of tackling crime and the (social) causes of crime. In office there has been little evidence of that careful balance. The jails have been filled and the nasty examples of educational failure driven from sight by antisocial behaviour orders.
However, the obese are all too visible. Relative poverty does not mean that you cannot afford to eat but it may mean that you are too poor or too ignorant to eat well.
If the pit of poverty looks as wide and deep as before, the ladder out of it is now more rickety. Last week the chief inspector of schools reported that the proportion of secondary schools deemed to be inadequate has risen under Blair, even though he has nearly doubled what taxpayers spend per pupil. More than half the secondary schools in England fail to provide good education. Blair’s legacy is in tatters.
The Conservative shift of ground on poverty is historically significant. Cameron and Clark have said little more than what Oliver Letwin, the party’s policy co-ordinator, said a year ago after Cameron’s election as leader. But this time the message has been heard and it aptly marks Cameron’s first anniversary. After 12 months of talking about health, the environment and now poverty, the Tories are unrecognisably improved.
As usual there are not yet any policy details. I do not complain about that. But if the change of thinking is taken seriously, its implications are enormous.
Take the position of the elderly. Within a few years three-quarters of our retired people will depend on means-tested benefits, while people in work will have become even richer than now. Old people in Britain will be much poorer, absolutely and relatively, than their counterparts in the rest of the European Union. Will that be tolerable? The people involved are near or beyond the end of their working lives so private provision is no answer.
Last week John Hutton, the works and pensions secretary, talked of the need to raise retirement ages to avoid tax increases. That is not really the issue. Our prudence over the past three decades means that we will keep the costs well below those in other countries, but the result will be millions of poor old people.
It goes back to Thatcher’s decision to raise the basic pension only in line with prices, not earnings, meaning that the state pension would not reflect rising national prosperity. Both John Major and Blair sustained the policy. On pensions strategy Labour joined the Thatcherite consensus.
If we are all truly concerned with relative poverty now, then it is not just the Tories who need to break with Thatcherism. Prime Minister Brown will have to, too.
