I posted this video to YouTube this morning.
In it I argue that Labour is saying it cannot afford to end child poverty. That, however, is only because it is refusing to charge more tax on the wealthy. Worse, it is refusing to acknowledge that this is the choice that it is making. For example, if it simply equalised the tax rates on income and capital gains, it could raise the money needed to end child poverty six times over. No reasonable person could object to that. So why is Labour refusing to consider it?
The transcript is:
Why won't Labour end child poverty at this election?
It could. The cost is £1.8 billion per annum, and as I've discussed in previous videos, that money could be found by it with ease if only it wanted to solve this problem.
And let's be clear about what the scale of this problem is. Because of the two-child cap on benefit payments introduced by George Osborne to supposedly force people back to work, nearly one million children are now living in poverty.
Some of those are in extreme poverty, the rest in moderate poverty. But that also implies that their families are living under stress as well, and most of those families have people who are at work within them. In other words, this policy which was introduced to push people back to work isn't working, nor has it changed the birth rate.
And nor has it delivered in any way the desired outcome that George Osborne imagined for it.
But Labour says, “Very sorry, there is no money, we can't solve this problem”. One million children in the UK are still going to have to live in poverty because we have fiscal rules that say we can't spend that much additional money to solve the crisis that they live in.
And I mean it's the crisis that they live in - the day-to-day problem of putting food on the table in front of them.
But it would be easy to solve that problem. For example, Labor could change the rate of tax charged on capital gains in this country. Capital gains are, of course, almost only earned by people with wealth because they arise on the sale of capital assets, works of art, rented properties, some types of collectible items, but most especially, and I mean most especially, on the sale of financial assets like shares.
Those assets are subject to tax, when they make a profit, at near enough half the rate of tax paid by a person on their ordinary income. If only we charged tax on capital gains at the same rate as income tax - and I beg you to find a good reason why we should not, because I cannot find one, because one pound in your pocket from wherever it comes has the same value to the recipient, whatever its source - if only we charged those capital gains to tax at income tax rates, then Labour could raise money. Twelve billion pounds of extra tax a year. In other words, they could not only remove the two-child benefit cap, but they could also have ten billion over to change other benefits to make sure that the children of this country have the childhoods they deserve.
I don't know why they won't promise this.
I'm completely baffled and I don't think there is any reasonable person in this country who could say that if you line up the choice between child poverty and low rates of tax on capital gains, we should choose low rates of tax on capital gains to favour the wealthy and blow the future and well-being of one million children. I don't believe anybody would really make that choice if it was put before them. But Labour isn't even giving us the chance because it won't address this issue. And in my opinion, that is wrong.
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“Why won’t Labour end child poverty at this election?”
Because they don’t work for the many just the few ?***!
If ever there was one surely this is the great Moral Outrage in this election.
Not only that but may I suggest that its Penny Wise and Pound Foolish, just looking at the huge increase in the numbers of children in care and the cost that entails, also money Local Authorities are having to spend from discretionary welfare funds to support families with more than two children.
There was a report by Ekklisia some years ago, I think it was this one
https://old.ekklesia.co.uk/node/18086
the PDF isnt there but it pointed out that
1 There is no difference in family size between ‘welfare dependant’ and ‘Non Welfare Dependant’ families, and
2. Families with three or more children are unusual these days, and
3. Four or more very rare
So the two child limit addresses a non existent problem
Not non-exostent, unfortunately.
It imapcts hundreds of thousands of children deeply adversely
Sorry, what I meant is that ‘Large Benefit Dependant Families’ are a non existent problem in the sense that there were no more than in the non benefit dependant world and there are not in any event that many
But it is a very real problem in terms of the number of children affected
There’s a very informative piece about this topic in a speech Danny Dorling gave in a book shop in Edinburgh. It’s at
Shattering nations, Scotland vs England and inequality: Danny Dorling at Edinburgh’s Topping Books (youtube.com)
and Danny starts to address the topic at 5:30 in. The source for this was Leah Gunn Barrett’s blog of 20th May : dearscotland@substack.com
For those who are too short of time to listen to the entire youtube entry, she transcribed the relevant part about child poverty as follows: “… a European country in 2020 that, when faced with the cost of living crisis and a pandemic, convened a government emergency committee and introduced a payment of £10 per week for each child under the age of 6 in families receiving benefits. In 2022 this was then increased to £25 per week for each child under the age of 16. For a family with 3 children, this meant an extra £4k per year. He asked the audience to guess which country he was talking about. Someone immediately responded, “Scotland.”
When he poses this question to his average English audience, he said it takes ten guesses to land on Scotland. That’s because England has no idea what Scotland has done to blunt Westminster welfare cuts or anything else for that matter. The media doesn’t report it, although it has to be said Scotland’s unionist media doesn’t relish reporting things that Scotland does well.
Professor Dorling said the Scottish Child Payment is responsible for the biggest reduction in child poverty in a year anywhere in Europe since 1989. The Scottish administration accomplished this within the Westminster-imposed Barnett Formula budgetary straightjacket. It just goes to show that alleviating poverty is a political choice.
He gave a quick history of the UK’s economic deterioration and rising inequality. Both began at the end of the 1970s. In the 1960s, only Sweden had a lower rate of inequality than the UK. In 1974 inequality in the UK reached its lowest level, competing with Finland and Norway, and the UK had the highest life expectancy and lowest infant mortality rates in the world.
From the 1980s, it’s been downhill as neoliberalism, ushered in by Thatcher, took hold. By 1992 inequality in the UK was worse than Portugal but Tory voters were doing well. New Labour did little to reverse inequalities. By 2016, only Bulgaria was more unequal than the UK. The UK government’s excuse was “At least we’re not as bad as South Africa or Brazil.”
The 2008 financial crisis followed by Tory austerity and the pandemic have accelerated the UK’s social and economic nosedive. It’s telling that when the UK left the EU, the European Parliament lost its largest bloc of far-right MEPs made up of UKIP and the Tories.
The Resolution Foundation’s Living Standards Outlook 2023 reported that 56% of children in the UK with 2 siblings were going hungry 2-3 times per month, figures not seen since the 1930s. Imperial College’s School of Public Health found that the average height of children in the UK is falling – UK five-year-olds are shorter than their European counterparts. The height decline began in 1985 and experts suggest that poor nutrition is stunting their growth. In addition, UK life expectancy is decreasing while depression and other mental illnesses are soaring. Failure is being normalised. In my local grocery store, there’s a sign asking shoppers to donate to the local food bank. Food banks didn’t exist before 2000 – now there are over 2,500.
This is why I routinely refer to the “failing UK.” A state is failing when it fails its people – their health, their welfare, their education, their futures.
And Keir Starmer’s English Labour party, a party which Dorling says ‘lost its soul’ in the late 1990s, is comfortably in bed with its corporate donors so won’t change the downward trajectory of this failing state but continue it.
My note: if Scotland can do it with the entire funding of its economy effectively controlled by Westminster via the Barnett Consequentials, Starmer has absolutely no excuse to naysay its adoption UK-wide.
Thanks, Ken. This is now a blog post in its own right.