Belfast Telegraph

John Simpson: No easy answers when it comes to tackling poverty


Combating poverty remains a key issue
Combating poverty remains a key issue
John Simpson

By John Simpson

The Stormont Executive supplements local social security spending to mitigate the impact of tight UK limits on spending to alleviate poverty and low living standards. The need for local adaptations has been supported by Northern Ireland ministers. This raises questions about the scale of need and also whether it is a UK problem or should appropriately be tackled as a devolved question.

Professor Philip Alston has said that when the mitigation package in Northern Ireland runs out in 2020, it will result in "leaving vulnerable people facing a cliff-edge scenario".

Government policy makers here face serious claims that more funds should be used to mitigate a range of policies, including the softening of the impact of Universal Credit, the calculation of Housing Benefit, the impact of the 'bedroom tax', the operation of the Housing Executive and giving financial support to people living with serious incapacity problems.

Allocating more funds to mitigate problems arising from social policy means that there will be less funding available for economic development or other services.

The current balance leaves many unacceptable outcomes.

Writing about the UK economy, United Nations expert Professor Alston was critical of the levels of extreme poverty that he had encountered in the UK.

He concluded that there was "a booming economy, high employment and a budget surplus", but that this had not been used to reverse austerity. Broadly, his assessment was that the UK is not doing enough to alleviate the incidence of extreme poverty. His report is sustained with reference to Northern Ireland.

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Professor Alston asks questions about how much more should be done to alleviate the worst incidences of poverty or how to re-prioritise current social policy.

These questions on the incidence of poverty have a relationship to the other priorities for managing the economy. How can the incidence of poverty be reduced and can this happen without indirect damage to the wider economy through the disincentive effects of higher taxation?

To pay for improved anti-poverty policies, do taxpayers realise that (after several years when the main tax rates have not significantly increased) the Chancellor may need to raise larger funds to pay for social policy?

Also, could better anti-poverty policies be designed to avoid becoming a major challenge to the acceptability of jobs which attract rates of pay just above the minimum living wage? Is there labour market disruption when there is a tension between the economics of the labour market and the setting of income support through social policy?

Improved anti-poverty policies may come in two different forms. Existing policies could be expanded or enhanced to ease aspects of policy which show scope for higher levels of spending. Alternatively, efforts might be made to redistribute current anti-poverty measures, possibly by using more means-testing criteria, so that a more effective outcome could be devised. These options contain a difference of approach that underpins much of the debate.

These questions apply whether as an aspect of UK policy or conceivably could be applied differently through the devolved Stormont regime, if the Executive took a more active role in diverging from Westminster decisions.

The comfortable argument would make suggestions of higher taxation to make social policy more flexible. This becomes a critical political choice.

Governments prefer to be elected with promises to achieve lower levels of taxation. The current United Nations report implicitly argues that some forms of higher taxation are merited.

Some of the existing anti-poverty policies are badly targeted or too generous. This is the argument that extends into criticism of (so-called) scroungers. The benefits freeze and benefits cap(s) introduced by the Government exemplify this approach which, despite the harsh critical edge, has been at the core of the recent austerity programme.

Finding a satisfactory balance between re-enforcing social policy and ensuring economic development has not been seriously scrutinised. It is a difficult policy question. That's not a good excuse to ignore it. Selective higher rates of taxation are likely.

Belfast Telegraph