Wednesday, 30 December 2015

The True Cost of Austerity (Part 1)

Some notes from the "True Cost of Austerity" launch event organised by Advice Nottingham recently (full report available here)...

The launch was presented by a panel including Chris Dearden (author of the report) and Baroness Lister. There were some interesting comments from the panel and audience, some of which are shown below :

* The Sneinton Food bank is providing food to around 50 families a week who have ZERO income.
* Some jobseekers lack key skills required to navigate the jobseeking and social security system (e.g. have no email, difficulty filling forms etc)
* The language of welfare has been "Americanised" to be one of "them and us", in contrast to a language of "social security" that we all pay in to and all might use. Similarly, "austerity" implies a a warm coming-together in difficult times, such as in WW2, whereas a more accurate word might simply be "cuts".
* When lobbying the House of Lords, one can see who is interested in the debate by checking who participates in the second reading of the Bill.
* When the actual, practical effects of policy are pointed out to Treasury officals, they become very uncomfortable.

The Launch of the "True Cost of Austerity" report

The report states that Nottingham faces a number of social issues, including :

1) In May 2013 the unemployment rate was rate was 6.5%, compared to 3.6% in England as a whole)

[BFTF wasn't sure that comparing an urban area like Nottingham with the whole of England was fair, so looked up unemployment claimant figures for some comparable cities, data is for Apr 2013 and from here.

Leicester (pop 330k) : 5.4%, 6.2%, 6.9% (East, South and West Constituencies respectively)
Coventry (pop 316k) : 5.7%, 4.0%, 4.1% (NE, NW, S)
NOTTINGHAM (pop 305k): 7.4%, 8.4%, 4.0% (E, N, S)
Wakefield (pop 325k) : 5.2%
Newcastle (pop 280k) : 6.0%, 4.4%, 3.7% (C, E, N)]


2) Almost 30 per cent of all households in Nottingham claim housing benefit double the rate of the East Midlands (15%)

3) Home ownership is lower in Nottingham (45%) than in the East Mids (67%)

[According to this 2011 census data, the above is borne out when comparing Nottingham to similarly sized cities:

Leicester : 50%
Coventry : 61%
NOTTINGHAM : 45%
Wakefield : 64%
Newcastle : 69%]


4) Nottingham is ranked 17th out of 326 local authorities for income deprivation (with 1 being the most deprived), and 13th for employment deprivation (again 1 being highest unemployment levels).

The above appears to come from this data, and when compared to similarly sized cities looks like this:

Leicester : 11th and 14th (out of 326)
Coventry : 24th and 22nd (out of 326)
NOTTINGHAM : 17th and 13th (out of 326)
Wakefield : 37th and 17th (out of 326)
Newcastle : 29th and 20th (out of 326)

It seems that Nottingham fares similarly to other similarly sized cities. Also worth noting that all five cities are in the most deprived 10% of areas on both criteria.


Mansfield Road, urban Nottingham


Debt and Social Security Changes

Advice Nottingham comment that "While the overall amount of debts we have assisted clients with has decreased since the credit crunch and recession, going down from more than £33million in 2012-13 to £22 million in 2014-15, the proportion of the debt that is priority debt – debts that have the worst outcomes – has increased from 24 to 35 per cent in the same period."

[Perhaps worth noting that the above statement means that actual value (as opposed to percentage) of priority debt has actually stayed pretty steady at just below £8million.]

The event and report also highlighted the changes that have been made in the social security system by the coalition and current conservative government:

* Introduction of Universal Credit;
* Personal Independence Payments to replace Disability Living Allowance;
* Changes to Employment and Support Allowance;
* Abolition of Council Tax Benefit / Introduction of Council Tax Reduction schemes;
* Abolition of Crisis Loans and Community Care Grants, funding passed to LA's;
* Introduction of the Benefit Cap;
* Introduction of the ‘bedroom tax’; and
* Introduction of Mandatory Reconsideration of benefit decisions before appeals

Advice Nottingham have helped their clients obtain approximately £2 million per year of lump sum payments they were entitled to, and £8.6 and £10 million per year of ongoing social security payments. A 2015 survey of service users found that 98% would recommend the service to others.

Mandatory Reconsideration
This disturbing policy states claimants who disagrees with a social security payment decision (e.g. refusal for an ESA claim) must go through a mandatory reconsideration process prior to lodging an appeal. Critically, the benefit is not payed during this reconsideration period. This results in a Kafa-esque situation that the report describes thus:

"One of the major issues to affect Advice Nottingham clients who are dissatisfied with an ESA decision is that where they are found fit for work but request a Mandatory Reconsideration (MR) the ESA stops. This leaves them with the choice of claiming Jobseeker’s Allowance (JSA) or having no income. Many are reluctant to claim JSA as they feel deeply that they are not fit for work, and fear not meeting the job seeking requirements and being sanctioned. There is an inherent contradiction here and some clients who do attend Jobcentre Plus to register for JSA have been refused on the grounds that they are clearly unfit for work."


Sanctions and Foodbanks
The report describes how many clients are unaware that they have been sanctioned until their benefits fail to arrive, despite the fact that such information should be communicated to them. Although many of them succeed in having such decisions overturned at reconsideration, this is of little help during the period they have no income and people often ask for advice at the point of having no money, no food and feeling desperate. All Advice can do on an immediate practical level at this point is to offer a voucher for a food bank.

Reports by the Church Action on Poverty and others suggest that the rise in is due to a combination of effects including insufficient income, high housing, food and fuel costs, changes to social security and income crises. The Advice Nottingham report comments that:

"Whatever the underlying reason for people using food banks, such usage is a short-term emergency measure; food banks are unable and unwilling to feed people for longer periods of time. Their unwillingness is due to the general belief that there should be a social security safety net that protects people against hunger. By stepping in to meet immediate need, some feel that they are replacing statutory services which ought to protect vulnerable people."


Made up packs at the Himmah Food Bank, ready to be passed onto agencies working on the frontline.


2 Week Snapshot
The report looks in detail at a two week period in Sept2015 in which Advice Nottingham analysed the interactions with those clients who were "financially vulnerable" (i.e. were at risk of losing their home or having utilities cut off). The number of clients who fell into this category over the 2 week period was 1,017.

By far the most common issue was benefit applications, with 22% of clients requiring help in this area;
5% of clients were seeking assistance following a JSA or ESA sanction;
7% of clients needed help following a Mandatory Reconsideration.

Money Matters
"Money Matters" courses, run by Advice Nottingham offer people the chance to learn about the Social Security System, Budgeting, Banking, Lowering Fuel Costs etc.

Case Studies
The report describes a number of case studies illustrating the kinds of issues that clients faced, and how Advice Nottingham was (or sometimes was not) able to help them. Names were changed in all cases. Very brief summaries of a couple of these case studies are shown below:

Case study - Colin
Colin is a 40 year old man with long standing mental health problems including depression and anxiety. He lives alone in a socially rented flat. A WCA assessment in Sep 2014 found that he was fit for work and Colin's ESA benefit was stopped. In Oct 2014, Colin approached Advice Nottingham for help in challenging the decision. At this point he had no income, his Housing Benefit had stopped and he was fearful of losing his home and was reliant on his family for money and food.

Advice Nottingham , over a number of sessions were able to win an appeal at Tribunal and get Colin's ESA reinstated, but this took until May 2015. At one session it was found that Colin has not eaten for two days so he was provided with a Foodbank voucher. At the end of the advice process, Colin commented that without the help of Advice Nottingham, he "wouldn't be here now" and that he had felt suicidal throughout the whole period he had no income.

Case study - Sally
Sally is 38 and has multiple sclerosis. She had been in full-time employment until a relapse of her multiple sclerosis left her in pain and unable to work. She made a claim for Personal Independence Payment and was awarded the standard rate of mobility and daily living components. Sally uses crutches and can only walk 50m very slowly, making it difficult to use public transport. Sally came to Advice Nottingham to see if any further assistance was available.

Advice Nottingham were able to help Sally complete a Mandatory Reconsideration request which resulted in Sally being awarded the enhanced mobility component of ESA. Sally now has an adapted car and a blue badge and has regained her independence.

Other case studies
Many other examples of the kind of cases that Advice Nottingham has to deal with can be read in a separate An Anthology of Modern Poverty booklet.

The True Cost of Austerity Report

Update 28 Mar 2016 [1]
Recently read Mhairi Blacks maiden speech in the House of Commons. It belongs in this post and is shown below in its entirety:

On her constituency
Now, when I discovered it is tradition to speak about the history of your constituency in a maiden speech, I decided to do some research despite the fact I’ve lived there all my life. And as one of the tale end doing the maiden speech of my colleagues in the SNP I’ve noticed that my colleagues quite often mention Rabbie Burns a lot and they all try to form this intrinsic connection between him and their own constituency and own him for themselves. I however feel no need to do this for during my research I discovered a fact which trumps them all. William Wallace was born in my constituency.

On benefit sanctions
Now, my constituency has a fascinating history far beyond the Hollywood film and historical name. from the mills of Paisley, to the industries of Johnson, right to the weavers in Kilbarchan, it’s got a wonderful population with a cracking sense of humour and much to offer both the tourists and to those who reside there. But the truth is that within my constituency it’s not all fantastic. We’ve watched our town centres deteriorate. We’re watched our communities decline. Our unemployment level is higher than that of the UK average. One in five children in my constituency go to bed hungry every night. Paisley Job Centre has the third highest number of sanctions in the whole of Scotland.

Before I was elected I volunteered for a charitable organisation and there was a gentleman who I grew very fond of. He was one of these guys who has been battered by life in every way imaginable. You name it, he’s been through it. And he used to come in to get food from this charity, and it was the only food that he had access to and it was the only meal he would get. And I sat with him and he told me about his fear of going to the Job Centre. He said “I’ve heard the stories Mhairi, they try and trick you out, they’ll tell you you’re a liar. I’m not a liar Mhairi, I’m not.” And I told him “It’s OK, calm down. Go, be honest, it’ll be fine.”

I then didn’t see him for about two or three weeks. I did get very worried, and when he finally did come back in I said to him “how did you get on?”

And without saying a word he burst into tears. That grown man standing in front of a 20-year-old crying his eyes out, because what had happened to him was the money that he would normally use to pay for his travel to come to the charity to get his food he decided that in order to afford to get to the Job Centre he would save that money. Because of this, he didn’t eat for five days, he didn’t drink. When he was on the bus on the way to the Job Centre he fainted due to exhaustion and dehydration. He was 15 minutes later for the Job Centre and he was sanctioned for 13 weeks.

Now, when the Chancellor spoke in his budget about fixing the roof while the sun is shining, I would have to ask on who is the sun shining? When he spoke about benefits not supporting certain kinds of lifestyles, is that the kind of lifestyle that he was talking about?

On Food Banks
If we go back even further when the Minister for Employment was asked to consider if there was a correlation between the number of sanctions and the rise in food bank use she stated, and I quote, “food banks play an important role in local welfare provision.” Renfrewshire has the third highest use of food banks use and food bank use is going up and up.

Food banks are not part of the welfare state, they are symbol that the welfare state is failing.

On housing
Now, the Government quite rightly pays for me through tax payers money to be able to live in London whilst I serve my constituents. My housing is subsidised by the tax payer. Now, the Chancellor in his budget said it is not fair that families earning over £40,000 in London should have their rents paid for my other working people. But it is OK so long as you’re an MP? In this budget the Chancellor also abolished any housing benefit for anyone below the age of 21.

So we are now in the ridiculous situation whereby because I am an MP not only am I the youngest, but I am also the only 20-year-old in the whole of the UK that the Chancellor is prepared to help with housing.

We now have one of the most uncaring, uncompromising and out of touch governments that the UK has seen since Thatcher.

On Labour and opposition
It is here now that I must turn to those who I share a bench with. Now I have in this chamber for ten weeks, and I have very deliberately stayed quiet and have listened intently to everything that has been said. I have heard multiple speeches from Labour benches standing to talk about the worrying rise of nationalism in Scotland, when in actual fact all these speeches have served to do is to demonstrate how deep the lack of understanding about Scotland is within the Labour party.

I like many SNP members come from a traditional socialist Labour family and I have never been quiet in my assertion that I feel that it is the Labour party that left me, not the other way about. The SNP did not triumph on a wave of nationalism; in fact nationalism has nothing to do with what’s happened in Scotland.

We triumphed on a wave of hope, hope that there was something different, something better to the Thatcherite neo-liberal policies that are produced from this chamber. Hope that representatives genuinely could give a voice to those who don’t have one.

I don’t mention this in order to pour salt into wounds which I am sure are very open and very sore for many members on these benches, both politically and personally. Colleagues, possibly friends, have lost their seats. I mention it in order to hold a mirror to the face of a party that seems to have forgotten the very people they’re supposed to represent, the very things they’re supposed to fight for.

After hearing the Labour leader’s intentions to support the changes of tax credits that the Chancellor has put forward, I must make this plea to the words of one of your own and a personal hero of mine.

Tony Benn once said that in politics there are weathercocks and sign posts. Weathercocks will spin in whatever direction the wind of public opinion may blow them, no matter what principal they may have to compromise.

And then there are signposts, signposts which stand true, and tall, and principled. And they point in the direction and they say this is the way to a better society and it is my job to convince you why.

Tony Benn was right when he said the only people worth remembering in politics were signposts.

Now, yes we will have political differences, yes in other parliaments we may be opposing parties, but within this chamber we are not. No matter how much I may wish it, the SNP is not the sole opposition to this Government, but nor is the Labour party. It is together with all the parties on these benches that we must form an opposition, and in order to be affective we must oppose not abstain. So I reach out a genuine hand of friendship which I can only hope will be taken. Let us come together, let us be that opposition, let us be that signpost of a better society. Ultimately people are needing a voice, people are needing help, let’s give them it.


Update 10 Apr 2016
One can get an idea of how bad the DWP "fitness for work" decisions are by reading about how a group of student lawyers in Bristol looked at 200 cases of DWP demming a person to be "fit for work" and were able to get the decision overturned in 95% of cases. This is significantly higher than the national average of 59% and shows how important legal support is to a successful challenge.

External Links
An Anthology of Modern Poverty
Austerity in Europe - A Cautionary Tale
ONS perspectives on home ownership in the UK
NTU Research into Nottingham's economy.
Foodbanks in Nottingham

Related Content
The Himmah Foodbank
Extracts from the Commons Fooodbank Debate
The Opportunity Costs of Bad Government

Image Sources
BFTF own and via Himmah

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