Labour’s ‘benefit cut’ for young people: populist or progressive?

Some of the criticism of Labour's welfare plans is misplaced.

Some of the criticism of Labour’s welfare plans is misplaced

Policy announcements lend themselves to multiple narratives. Labour’s announcement of restrictions to Jobseeker’s Allowance for 18-21-year-olds is no exception.

“Labour to cut youth benefits”, ran the Guardian’s headline, with Patrick Wintour’s copy noting “The move is designed to symbolise Labour’s determination to reform welfare”.

Reactions on twitter fell into predictable lines:

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I have a lot of respect for Rob and Alex and many others who responded in similar terms. I also think the spin on the policy was counter-productive, leaving people with the sense that Labour was simply loking for a symbolic ‘get tough’ policy. The cuts (savings) amount to a mere £65m, the sort of money DWP can (and regularly does) lose down the back of the sofa.

But while I don’t think the policy as it stands is optimal, I don’t buy the idea it was cooked up for the tabloids or potential UKIP voters either. The true narrative is one of progressive aims running up against inherited structures and prospective fiscal constraints and muddling through as well as can be expected.

Here’s my understanding of the problem the policy is intended to address.

People who are attending education or training for more than 16 hours a week have no access to Jobseeker’s Allowance (JSA). This means that post-secondary school training opportunities are effectively foreclosed for school-leavers from the lowest income families, leaving JSA as the only option in the absence of employment.

Because of the all-too-close relationship between family income and educational attainment, this in turn means that those who have most need for post-secondary education and training are the ones who are least likely to get it.

So why not just abolish the 16-hour rule altogether? This is where the fiscal constraints narrow down the available options.

Abolishing the rule would open up access to JSA to everyone attending FE colleges, regardless of financial need: whatever the (debatable) attractions of such a universalist approach, it would mean a major increase in spending, which for better or worse is ruled out by the party’s fiscal stance.

The only other obvious option to extend financial support for training to these young people is to ration it, which is what the Youth Allowance proposals do. The rationing mechanisms are to limit financial support while in training to those falling below some minimum qualifications level and to those whose parents have low incomes.

However rationing on parental income introduces an assumption that people are still living with their parents unless there is some good reason why this isn’t possible. So it looks as if young people who have done nothing wrong are being told, solely on the basis of their social class and school attainment, that if they aren’t in work they will have to stay at home and undertake training.

Whether the policy is as draconian as this sounds will depend on the detail. It is notable that Labour isn’t claiming it will make any savings on housing benefit from the proposal. That suggests that they expect a lot of those receiving the Youth Allowance while in training to be living away from their parents.

That makes obvious sense: some people in this age group are already parents themselves, some will have left home while in employment and lost their job, some will have moved to another part of the country to look for work, some will have had to leave home for serious personal reasons and so on.

So it looks as if the intention is that many of the hard cases that immediately spring to mind when one reads the headlines will in fact be entitled to support. But it would be foolish to underplay the risks involved in what will inevitably be a broad-brush approach. Do we really want the state deciding whether people have a legtimate reason for leaving home?

Even if there was consensus on the criteria (unlikely), do we think it would it be competent to apply them fairly?

And there are other reservations.

The conditionality imposed on those leaving school with poor qualifications looks uncomfortably like penalising people for something which (at least in many cases) is not in their control. And the policy will probably reduce jobsearch among school leavers, some of whom would have found sustained employment. Training may, on balance, be better in the long run for the majority – but not for all.

Against these reservations, the policy promises to plug a major gap in the UK skills system, providing financial support for those who need it most and access to the sort of training that is most likely to help long-term job prospects.

As I said, I don’t think the policy is optimal and I’ve indicated some of the risks – no doubt there are more. There is obviously plenty of scope for criticism. But some of the criticism we’ve seen has been misplaced. Populism and symbolic posturing seem to have played little or no role in generating the policy (as opposed to the spin).

Those who dislike the policy should be asking such questions as whether the problem it aims to address is the right one to focus on, whether the policy will actually address it and whether there are other options that might do so better.

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