Andy Cook is Chief Executive Officer of the Centre for Social Justice
In politics, as often in life, you seldom get praise for what doesn’t happen.
But when we look back on the recent history of this pandemic, we will recognise Universal Credit as a great success story. Had we still been operating the paper-based system of the Tony Blair/Gordon Brown era, we would have had unemployment queues snaking round city centres. It wouldn’t have needed an England footballer to point this out, it would (quite rightly) have shamed the country.
I remember that time well. Despite massive government spending, I founded a charity to tackle unemployment – because there were generations of kids who were being harmed because they didn’t see the benefits of work in their home life. We musn’t return to those days.
We are now facing the grim prospect of unemployment as high as 13 per cent – that’s around four million people without a job. In July, 5.6 million people were receiving welfare with almost half officially “searching for work.” One of the areas with the highest numbers of new Universal Credit claims is leafy Guildford in Surrey.
Britain faces the very real problem of mass, long-term unemployment. At the beginning of 2020, there were 3.1 million people in Britain who were not working, but wanted a job. This figure could grow by more than two million due to the Covid-19 crisis.
Benefit claimants are increasingly vulnerable, with more complex challenges, meaning that they need more support when navigating our welfare system. Inadequate support for some claimants has resulted in some falling in to a ‘state of crisis’ – increased financial insecurity, food bank usage, evictions, and homelessness as well as worsening mental health.
Unemployment can be disastrous for any individual. Unemployment is not just the loss of an income, but the loss of a sense of purpose, identity, and dignity. Poor health quickly follows.
If we want to get really serious about tackling poverty, we have to get serious about making sure people get into jobs. Financial pressures can lead to debt, housing problems, relationship strains, and in the most extreme cases, violence, homelessness, substance misuse and criminal activity.
This is the true cost of an unemployment crisis. Worklessness has a lasting impact on communities, and children growing up in a workless household are more likely to perform poorly at school, less likely to work themselves, and end up involved in the criminal justice system.
For all the winter eeconomic plans announced by the Chancellor, tackling the human toll of worklessness will be the biggest long term challenge. Long before the pandemic struck, the UK still had a long-term unemployment problem, with particular challenges from disability, and a disability employment gap that had hardly shifted in a decade.
Despite remarkable successes over the last ten years in halving the number of people unemployed for two years or more, the other half still exist, pandemic or no pandemic. The challenge will now be to make sure that our millions of newly unemployed (and their families) don’t join them as long term unemployment ‘stats’.
There are real human lives behind the statistics – which is why the Chancellor must look seriously at Universal Support.
Universal Support gets money to local charities to offer real personal support for jobseekers. Run by local authorities, Universal Support works alongside Universal Credit payments, with the aim of helping welfare claimants tackle the real barriers to sustained work.
Helping people who may be applying for Universal Credit, but who also need help in stabilising their housing situation, advice on dealing with burdensome debt, help in accessing opportunities to develop skills, or getting an appointment for a medical diagnosis – Universal Support commissions local charities who work with people rather than statistics.
A truly compassionate social security system should be about helping to support people fallen on hard times, not just a welfare check in the post. It is self-evidently not enough for programmes to get people work ready if there is no work. So it’s also time to channel our inner Reagan and go for some big tax cuts targeted at the regions to rebalance the UK and encourage the creation of jobs.
The recovery must be driven by the private sector, but the Government should seize the opportunity to direct this in a regionalist way with rebalancing as an explicit goal.
The Centre for Social Justice’s paper “The Future of Work: Regional Revolution” makes the case for enterprise zones in the UK’s most left behind towns and cities: tax breaks and financial incentives would be offered specifically to businesses operating in these regions. State loans to start-ups should have job creation in our poorest areas as an explicit objective.
We can’t just treat unemployment as a problem on a spreadsheet. There are real human lives behind the statistics, which is where Universal Support comes in. We need to see it in every town. Economic measures to rebuild our regional economies need to go alongside welfare support that stops the spiral of unemployment and offers a compassionate helping hand into newly-created jobs.