Inequalities

Lord Wallace of Saltaire Excerpts

Thursday 13th June 2019 Lords Chamber

[Lord Wallace of Saltire (LD)]

My Lords, I half agree with the Deaton review’s opening declaration that:

“Discussion of inequalities increasingly defines economic and political debate”.


That ought to be one of the central issues of British politics rather than the endless preoccupation with Brexit, sovereignty and making Britain great again, let alone cutting taxes for the rich and cutting services and benefits for the poor, as Boris Johnson is proposing to the apparent delight of Conservative Party members. I noted the article in the Telegraph last week by Daniel Hannan MEP, one of the Conservative Party’s leading ideologues. It dismissed the idea of poverty in Britain as being in reality about only inequality, and furthermore argued that inequality is not rising very much and, in any case, does not matter.

Successive analysts of open and democratic societies have argued for centuries that too great a gap between the rich and the poor is incompatible with a peaceful and mutually tolerant national community. The whole idea of a democratic national community requires a shared sense of commitment; a social contract shared by all citizens and between citizens and the state. Too wide a gap between the privileged and the underprivileged, between the very rich and the very poor, undermines this common citizenship. Liberals in the late 19th century and early 20th century invested public finances in state education, pensions and welfare in order to bring the poorest Britons into our national community.

The wildest Chicago School economists have denied the necessity of concessions to democracy in their pursuit of the free market, as we saw in their support for Pinochet’s economic experiments and political repression in Chile. Illiberal democracy offers citizens grievances against foreigners and myths about national history as a distraction, while oligarchs and billionaires use their money to buy influence and distort the political debate. We see illiberal democracy, or populism, played out by rich and privileged men pretending to be men of the people, spreading across the democratic world and now across the Conservative Party in Britain.

I regret that the sometimes intemperate language of Philip Alston’s UN human rights report has allowed the UK Government to dismiss the argument that he makes. It would have been more powerful as a restrained analysis than as the case for the prosecution he has made it. The detailed studies on which it is based, from universities, reputable think tanks and government agencies, are powerful enough on their own. Like the Deaton review, it emphasises the multiple dimensions of poverty and inequality, and the interaction of disadvantages in child care and early years support, education, housing, access to jobs and public transport with low wages and benefits. I welcome the accumulation of data-based studies, including those from the Resolution Foundation and the Social Metrics Commission.

I see inequality and deprivation on the ground in Bradford and West Yorkshire. The most deprived wards in Bradford, whether predominantly ethnic white or Asian, also have the highest rates of crime and violence, the largest number of children growing up in single-parent households, the least access to playing fields and open spaces, and the lowest ranking schools. Last summer, I was driven round a former council estate by one of our local councillors. We saw no representatives of authority—police numbers had been cut and community police teams disbanded—and we saw social housing that had been sold off now rented out for multiple occupancy by private landlords. We saw children who should have been at school playing in the street, and teenagers who looked as if they were dealing drugs. The prospects for social cohesion, let alone social mobility, in such circumstances are dire.

We should also note the regional dimension of inequality in England and welcome the first report of the UK2070 Commission, chaired by the noble Lord, Lord Kerslake. It notes,

“the historic concentration of public investment in London and the wider south-east”,

under successive Governments—Labour, coalition and Conservative—and its link to the concentration of political power in London.

Let us admit that all parties have contributed, over two decades and more, to the problems we now face. However, the Conservative’s determination to shrink public spending to 35% of national income, against the 40% which was the agreed coalition target, is making economic inequality and social alienation much worse. We could do a great deal to solve such problems with 3% to 5% of our national income, instead of demanding more and more tax cuts for those already well off.

I heard a member of the Cabinet yesterday refer to our “broken social contract”. He is right to use such stark language. If not fixed, a broken social contract will threaten to break our liberal and democratic national community.