Daily Mail Welfare Story - Untrue and Dangerously Misleading

If I blogged every time the Daily Mail printed an untruth about people on benefits I wouldn't get away from my laptop very often. But today’s untruth is designed to soften up public opinion for benefit cuts to be announced on Wednesday – and as such it deserves some examination.

The argument from Government which is supported by this erroneous article is that the UK cannot afford the current welfare system and that its costs have spiralled out of control. Affordability is a value judgement – is the benefit of our Welfare system worth the price. The price however is a matter of fact. A useful understanding of the price is can be informed by data and is all too easily misinformed by distortions and untruths.

The key line in the article is “In 1948 spending on benefits accounted for 10.4% of Britain’s total income, against 24.2% this year.” This is under no circumstances true.

National Income is a term that generally refers to the Gross National Product* (GNP). “Benefits” is a difficult term to define but to illustrate I have produced a graph showing both the Office of National Statistics and the Department of Work and Pensions figures at their very largest. They include, in size order, pensions (over half of total spending), sickness and disability, Tax credits (ONS only) income support, unemployment (under 5% of total spending) and various other money transfers. It is a graph of Welfare spending as a proportion of GDP over time from 1979 to 2012/13. These are the numbers I have to hand  – but the point is clear – Welfare spending is a lot less than 24.2%

Graph of Welfare spending as a proportion of GDP data available Data

You may notice something else – that using the very sensible measure of Welfare spending as proportion of GDP welfare spending is still lower than the mid-1990s. Not something you will hear Government spokespeople saying. Indeed the article quotes an increase in 60% of benefits under Labour – I am sure there is a way of defining the terms such that this is true – I am equally certain it is at best a small fraction of the truth.

Other points made in the article are that the state pension has trebled since 1948 and unemployment benefit has doubled. I wouldn’t take the numbers at face value as the make up of the benefits has changed markedly eg. Pension credit, contributory pension, housing benefit, winter fuel allowance and other transfers may or may not be included in the comparison. It is important to realise that neither the state pension nor unemployment benefits have kept pace with the average wage for over 30 years. Recipients of only these basic benefits are in reality a great deal poorer than the 1980s.

Can we afford the current Welfare Budget?

In cash terms and real terms (where the numbers are adjusted for inflation) Welfare expenditure has increased – a great deal. Our personal incomes and national income has also increased a great deal – in recent years faster than the welfare budget.

The question is do we think the old, the sick and the vulnerable (who make up the vast majority of welfare recipients) should share in our increased national wealth? The alternative is that these groups become increasingly disadvantaged relative to the rest of the population. If, as I do, you think these people should not be gradually disadvantaged the comparison of national income to welfare spending is the most important measure to use. In which case we have afforded greater than the current welfare levels in the past and should not accept the argument that we are unable to afford it now.

Link to the data – workbook include graphs of the groups receiving benefits over time, essentially working age families decreasing as a proportion of spending and retired age families increasing.

 

*The term “total income” might mean the UK Govt’s tax take but that doesn't get to 24.2%. My best guess is that the number is derived from the ONS welfare expenditure, which is the largest measure available, and projected to be 24.17% of the Total Govt's managed expenditure in 2013/14 - nothing like "Britians Total Income".

Justice for All

Early advice and help can stop people becoming homeless, be consumed by debt or be treated unjustly at work or by landlords. The Baptist Union of Great Britain, the United Reformed Church and the Methodist Church are supporting the Justice for All campaign. This campaign is needed because community legal and advice services which help the most vulnerable in a community get treated fairly are under threat through the Government's Legal Aid, Sentencing and Punishment of Offenders Bill and through spending cuts.

The President of the Methodist Conference, Revd Leo Osborn, said recently:

"It is clear that over the coming months and years the
numbers of people in living in poverty will increase. Decisions regarding benefits and housing will become
increasingly crucial in people’s lives. Sadly there are people that seek to exploit those who have fallen on hard times. This is a time when legal advice and access to justice for the poorest will become increasingly important and it is vital that the government recognises
this priority.

"Justice should be available to all, it is not a commodity to be bought and sold. Any system which makes just treatment dependant on a person’s income is profoundly at odds with Gospel values."

Research by Justice for All suggests that under the new arrangements, a third of the country may not have face to face employment, housing or debt advice.If you would like to write to your MP in advance of the report stages debate in the House of Commons, find out more information from the Justice for All website or use their online tool to write directly to your MP.

Scapegoats and benefit statistics...

The Churches have received some media coverage this week for calling the Chancellor, George Osborne MP, and the Department of Work and Pensions to account over the use of statistics.

In the Chancellor's speech announcing the Comprehensive Spending Review, and in DWP documents, the charge has been repeated that the country suffers from £5 billion benefit fraud. Mr Osborne said:

“Nor will fraud in the welfare system be tolerated any more. We estimate that £5 billion a year is being lost in this way - £5 billion that others have to work long hours to pay in their taxes. This week we published our plans to step up the fight to catch benefit cheats and deploy uncompromising penalties when they are caught.”

However when you look at the figures from the Government and HMRC, these reveal that of this £5 billion, benefit fraud is estimated at £1billion, and tax credit fraud is estimated at £0.6 billion, making a total of £1.6 billion. The exaggerated figure of £5 billion is derived by adding the fraud estimates to the estimates of error - errors made by Government as well as claimants.

We agree with the Government that benefit fraud is a serious offence, but implying that the poorest perpetrate this offence three times more than is the case is clearly unjust. The Baptist Union, the Methodist Church and the United Reformed Church, together with the Church of Scotland, the Salvation Army, Church Action on Poverty and Housing Justice, have written to the Prime Minister asking that these statistics should not be misused again in ways that stigmatise benefit claimants, and that the public record should be corrected. We are waiting for the Prime Minister's reply. You can see here how the story was covered by the BBC , by the Guardian, and by the Telegraph .

Hung Parliament: a unique opportunity to advance the common good

This statement was made by the United Reformed Church after the election results:

The inconclusive result of the General Election provides a unique opportunity to re-orient Westminster politics towards the common good, according to Simon Loveitt, who speaks on public issues for the United Reformed Church.

He said: “This election was fought on the platforms of fairness, honesty and transparency after the loss of public trust in financial and political institutions, in the wake of the financial crisis and MPs’ expenses scandal. It is these principles which must guide party leaders in their deliberations in the days ahead”.

The poll has taken place against a backdrop of growing uncertainty in the financial markets over the effect that one country’s debts will have upon others, and fears following Greece’s bail-out by the European Union and the IMF.

Simon Loveitt added: “The old adversarial style of politics must give way to a more constructive, creative and hopeful discourse focused on governing in the national interest rather than narrow party political interests, in light of the converging global economic, environmental and energy crises”.

Earlier, the general secretary of the United Reformed Church, the Revd Roberta Rominger, urged Christians to pray for all the Party leaders as they seek ways to work towards forming a strong, stable and principled government based on principles of the common good. “As people of faith, we are uniquely positioned to take the long view on the kind of society we are seeking to build – a society where justice, peace and human flourishing prevail for all’ she said.