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“I find economics increasingly satisfactory, and I think I am rather good at it.”– John Maynard Keynes

Sunday, 10 December 2023

A good synopsis of the damage inequality is doing

 

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MARTIN IVENS | COMMENT

The social divide exposed by Britain’s crushing Covid hangover

Life is getting worse for the 13.4 million people enduring poverty and ill health, being on the sick pays more than dead-end jobs, and the education of the least well-off children is suffering. How can we close the wealth gap?

The Sunday Times
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The past is supposed to be a foreign country. But looking back at the Victorian-era debate over the gap between the wealthy and the poor, the “Two Nations” described by Benjamin Disraeli, we experience a shock of recognition. Britain is a deeply divided society today too.

There is, however, an important distinction. The Victorians looked forward to steady improvement in the conditions of the poor. With good reason, our ancestors were earnest optimists: things really could only get better. Today is a rather different matter.

I’m a commissioner on the Social Justice Commission report, a major investigation by the Centre for Social Justice think tank into the effects of the pandemic on British society, compiled by a cross-party group of Labour, Conservatives and Liberal Democrats bolstered by charity workers, entrepreneurs and economists.

According to the evidence collected in our interim report, entitled Two Nations and published this week, life for Britain’s underclass today is going backwards.

This is no tiny minority. The lives of 13.4 million people are blighted by poverty and ill health. And help is not on the way. Our political culture is mired in pessimism and declinism. Even the better-off are worried by stagnant wages, low economic growth and poor productivity, so imagine what it is like to be at the bottom of the heap?

At the height of the Second World War, when Britain was fighting for its existence, the great civil servant William Beveridge produced his landmark report calling for a battle against what he called the “five giants”: idleness, ignorance, disease, squalor and want. Beveridge’s report inspired the post-war generation to create the National Health Service and the safety net of the welfare state.

In the spirit of Beveridge, 20 years ago the Centre for Social Justice conducted an inquiry into life at the bottom of the social pyramid, Broken Britain. Our new five giants were identified as family breakdown, personal debt, education failure, addiction and worklessness. Some improvements have been seen since then — nominal unemployment has fallen and England’s international rankings in education, published last week, have improved, although the provision of vocational training in this country is still pitiful.

The effect of lockdown and pandemic-era closures has been to turn back the clock on these improvements. In a specially designed opinion poll, we asked the poorest in Britain what they thought had happened to them these last few years. One shocking statistic emerges: 40 per cent of the most disadvantaged people surveyed report having a mental health condition, compared to just 13 per cent of the general population. Over half of those have signed off work, reported depression or anxiety.

As the political parties debate soaring immigration figures, they tend to overlook why there are so many vacancies that need to be filled in the first place. It is not all down to missing skills. A large part of society has been demoralised by being cut off for months from regular contact with work and community. Those people need help.

Poor mental health, and an ever-increasing number permanently signed off on disability benefits, have shrunk the size of the workforce. The number of people economically inactive because of long-term sickness has risen to 2.6 million, an increase of 500,000 since before the pandemic.

The odds are stacked against the low-paid. Take one finding cited in our report: a single earner in Sutton Coldfield keeps 32 per cent of their income (after costs including tax and housing) when they start part-time work on the minimum wage. Whereas the same person on benefits would have kept 34 per cent (also after costs including housing). The low-paid fear they will be stuck in dead-end jobs too: only three in ten told us they expected to make any progress. Is it any wonder that, for many, being sick pays better?

And those are just the statistics for adults. It is the children of the most disadvantaged who bear the rawest scars of the lockdown. Being educated online may have suited many middle-class young people, although I would not underestimate how many were distressed by the lack of real social contact. But poor children, especially those from dysfunctional homes, suffered disproportionately.

Calls to domestic helplines soared during the pandemic. The prevalence of mental ill health in children went from one in nine to one in six. Frequent school absences jumped 134 per cent and attendance rates have never recovered. A mere 57 per cent of the most disadvantaged pupils leave primary school with the expected standards in reading, writing and maths.

Some 40,000 children are now missing more school than they attend and a fifth of the entire school population miss an afternoon a week. Many parents learnt during lockdown to keep their children at home; they enjoy the company of loved ones but they ignore the long-term damage to their prospects.

Early next year, our commission will produce its final report, recommending courses of action. With a general election due to be called within a year, we hope to spark a Beveridge-style debate about how to close the gap between rich and poor. It is time we had a politics for Two Nations, not just one.

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