Ryan Shorthouse is the Director of Bright Blue.
For the young, the socially mobile or the successful, the Conservative Party is often attractive because of its historical association with and defence of liberty. Of freeing individuals from unnecessary barriers – ideology, tax or regulation – that hampers them from achieving a good education, an affordable home, a higher income, even starting a business.
But Theresa May is asking lovers of liberty to think differently: to step into the shoes of those who will not be so lucky in life. For many ‘ordinary working families’, it is security – not freedom – they yearn for most. They want and deserve greater control over their lives, too – over deteriorating employment opportunities, housing, services and civicness in the communities they live in.
So, when pondering what the upcoming Conservative manifesto should and will include, don’t look Right. Not least because many voters, especially those who flirt with UKIP, are already aware of the Prime Minister’s tough stance on immigration and desire for a clean break from the European Union. To win big, she must reassure those in constituencies currently represented by Labour – who are disproportionately on modest incomes and from Black, Minority and Ethnic backgrounds – that today’s Conservative Party will manage the country and Brexit in a way that looks after them.
May is offering them something slightly different from the Conservatives: communitarianism, with a strong state intervening in markets and communities to provide them with greater economic and social security. This manifesto will not be small-state stuff: it will seek to show “the good that government can do” with policies that aim to enhance the living standards and public services – especially social care, the NHS and state schools – for low-and middle-income voters.
The manifesto won’t be expansive, however. This is because the election has been framed narrowly, there is no credible electoral challenge from the Opposition, and ministers want sufficient flexibility to deal with Brexit and the economy. But it should have a sprinkling of bold and distinctive policies, so the public can better see the shape and flesh of Mayism.
A bigger role for the state need not mean just spending more. First, because the structural budget needs eliminating, for moral and economic reasons. New policies should not add to the fiscal burden – either in themselves or by cutting elsewhere. There’s plenty of options for the latter: the triple lock on state pensions and regressive higher-rate tax relief on private pensions, to name a few. Second, because the state has a range of different powers that Conservatives have historically used and can do so again: guaranteeing powers to maintain economic confidence and share risks; convening powers to bring together public and private institutions; and regulatory powers.
Through her manifesto, the Prime Minister ought to show voters that her original vision for the state is not a leftist one, simply giving people more money, but about strengthening the financial, human and social capital of everyone – especially those on modest incomes – so they can build the assets to have more control over their lives in an ever-changing, globalised world.
First, on financial capital. Austerity has, and continues to, hit those on modest incomes hard thanks to a combination of stagnant wages and unnecessarily deep cuts to both out-of-work and in-work benefits. In the manifesto, a new welfare settlement from the Conservatives needs championing. A contribution supplement should be added to two major benefits, Universal Credit and Statutory Maternity Pay, to reward those with long work histories on modest incomes. Everyone should also be entitled to save into a high-interest, tax-free personal welfare account – which government tops up for those on modest incomes – which they can draw down from in testing times.
All parents with young children should be offered government-backed, income-contingent childcare loans. These would smooth crippling childcare costs over a longer period and make it affordable for all families overnight. Stamp duty for cheaper properties should be substantially reduced. Finally, it’s time for government to focus its effort on raising the salary threshold for the payment of employees’ National Insurance, which kicks in at £8,160 this year, rather than the Personal Tax Allowance.
Second, on human capital. The Government needs a flagship policy to convince parents that the Conservatives are committed to improving comprehensive schools. A new salary supplement for teachers working in under-performing and coasting schools should be introduced, to help attract the brightest and best to where they are most needed.
Attendance in high-quality pre-school education has been shown to have durable positive impact on attainment, especially for those from less affluent backgrounds. The Government should abandon its plans to extend free childcare for all three and four year olds from 15 hours to 30 hours a week, and use this funding instead to attract talented graduates into pre-school education. Universities charging fees above £6,000 a year will soon have to set up or sponsor a state school; that could also apply to pre-school centres.
The current Government’s welcome focus on and policies for improving technical education could be bolder. All apprentices, who are currently subject to a much lower minimum wage than other employees, should be offered maintenance loans, currently only available to higher education students. People increasingly have changeable and longer working lives. Lifelong learning will therefore be increasingly necessary. All adults should be granted a lifetime learning loan account, which they can draw from to pay for any type of approved course to upskill or reskill, which they pay back on an income-contingent basis under stricter repayment terms for every new course undertaken.
Third, on social capital. The key is to enable people to build stronger and diverse social networks, which has been proven to reduce the likelihood of living in poverty and build neighbourhood trust. The Transferable Tax Allowance – which provides tax relief to a basic-rate taxpayer whose partner leaves the labour market to look after children – should be increased in value and extended to all couples, not just married ones. Grandparents too should be able to shift their personal tax allowance to their adult child if they leave a job to look after grandchildren.
Being able to understand and speak English is fundamental to participating in the labour market and society. Currently, if migrants do not improve their English, they can lose their entitlement to certain benefits. It should be a requirement for all migrants in the UK – if they want to receive any working-aged benefits – to prove that they can speak English by having an approved qualification, or at least be working towards one. The Government should ensure that all migrants are able to access such courses through adequate ESOL funding or the introduction of income-contingent loans for migrants to be able to afford to pay course fees.
There are a minority of areas in the country that are struggling with large inflows of migrants, especially because there is insufficient capacity and expertise in key services such as health services and schools. Local authorities can bid for additional resources for public services to better manage high and unexpected immigration through the government’s Controlled Migration Fund. But the fund only makes £100 million available and it only lasts until 2019-20. The Prime Minister should commit to making it permanent and significantly increasing the funding available, resourced through a new National Insurance that all working immigrants should pay for two years, excluding refugees and students.
Finally, how about introducing mandatory ‘Local Service’ for all 16 year olds, placing a duty on all schools to ensure all those who have finished their GCSEs are partaking for a minimum of a week in their summer holidays in a voluntary activity, such as programmes delivered by National Citizen Service?
Theresa May has the political capital to be ambitious in this manifesto and prove that the Conservatives are the natural choice for ‘ordinary working families’.