Fraser Nelson

Brown’s legacy of inequality, poverty and joblessness

Brown's legacy of inequality, poverty and joblessness
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We all know Labour has failed to run an efficient economy or public services, but what’s little discussed is its failure to achieve even its own goals. Had Brown bankrupted the country but, say, made the poorest much better off, then Labour members might not be facing such an existential crisis. As it stands they won three victories, trebled health spending, redistributed some £1.5 trillion – and will end up with a society even more ‘unequal’ than it ever was under Thatcher. I look at this in my column today, and thought I’d share a few of the points with CoffeeHousers.

First, equality. This (rather than making the poor better off) is the great leftist goal – and it can be nominally achieved by hurting the rich. But let’s look at the Gini index - which John Rentoul, who has written a book about inequality, regards as the most reliable measure.  The left were very agitated about this index when it shot up in the 1980s. But it’s even higher now:

So, by the Gini definition, Britain has never been more “unequal”. That in itself wouldn’t bother me, if I thought that the poorer were better off as an upshot. But the staggering fact is that the poorest are getting poorer. I compiled the below from various editions of the DWP’s “Households Below Average Income” survey:

During the last election campaign, I put this to Tony Blair – and he was baffled. What about the minimum wage, he asked? Bless. The poor soul probably believed Brown’s figures that unemployment had fallen. In fact, the figures for Jobseekers Allowance are dwarfed by other forms of hidden unemployment – the DWP gives a full list here:

Now, last week I asked the DWP to say how many of these people had been on benefits for how long - this means claiming out-of-work benefits (as opposed to tax credits, income supplements etc)". Its openly-available data only goes up to “five years or more”… my request, the DWP kindly broke it down and a staggering 1.1m souls – more than the population of Birmingham, our second city - have been on the benefits for 12 years or more (ie, throughout the Labour years). As far as I know, this information has never been made available before.

These people were bypassed by the economic boom. (The DWP’s welfare reform, which I welcome, has arrived too late). But what about Brown’s claims to have “created three million new jobs?” Well, part of that was pensioners returning to work. Another part was the engorgement of the public sector. Look at the number of jobs in the private sector and split it down by immigration status:

So foreign-born workers account for all of the net job creation since 1997. In this way, economic growth is decoupled from unemployment. The poor get poorer, Britain gets more unequal. To me, the most striking figure of this is those 1.1m – what kind of “progressive” government leaves so many to languish on benefits, while using the boom to double the ratio of immigrant workers? A Labour government was expected to tackle unemployment. Deplorably, Gordon Brown looked the other way.  David Cameron must not.