From April this year, the UK government will cap overall spending on welfare. Chris Johnes (Oxfam) hoped this would encourage government departments to invest in long-term programmes tackling poverty to cut future spending… but the current social housing strategy seems to be aiming for exactly the opposite.
Tackling the high cost of welfare is one of the government’s top priorities. Isn’t it? Both the Prime Minister and the Chancellor have repeatedly said that cutting welfare costs is essential to getting the budget deficit under control. So after freezing many benefits for working age people last year, the government has since decided it will introduce an overall cap on many benefits starting from next financial year.
This should be a spur to government departments to look at ways they can get the welfare bill down. Indeed, our experience as a charity is that the Treasury is interested at looking at how longer term preventative programmes – which help people tackle deep rooted personal problems – can be supported to cut the need for welfare spend in the future. These kinds of preventative spending could include family support, more tailored back to work schemes, expanding the supply of cheaper housing and better vocational education.
However, nobody seems to have told the Department for Communities and Local Government (DCLG), which seems determined to continue a housing strategy for England that will further push up rents. The strategy – which doesn’t include plans for building new homes for “social rent” (ie genuinely affordable rent) – will also drive up the need for people on low incomes to draw on housing benefit to be able to afford their rent.
The reality is that the current mix of jobs and housing available means that many people in work, especially in the south east, need housing benefit to be able to pay their rent. And the DCLG’s policy is based quite deliberately on allowing the housing benefit bill to rise – it’s not their problem, it’s another department’s budget. However, it could soon become the tenants’ problem in a big way.
If the welfare spending cap is breached, then housing benefit is an obvious target – it’s one of the largest benefits covered by the cap (it costs £24bn per year) – which means the amount of housing benefit available per person could be reduced if overall welfare spend goes too high.
And if people on low incomes will no longer have their rents fully covered, then they will face their household budgets getting even more squeezed and being forced to choose between paying the rent, heating their homes or eating. In other words, severe hardship will be imposed on thousands, if not hundreds of thousands of families because different bits of government failed to work effectively together.
There is, of course, an alternative, as charities have been telling the Treasury and governments in other parts of the UK have been pursuing. This is to put proper investment in genuinely affordable social housing – it may be expensive initially, but its long-term impact on rents will save both government money and human misery in the future.
Source – Chris Johnes, Director, UK Poverty Programme, Oxfam
Blame the teachers time again –
Schools failing to prepare North East pupils for career in automotive sector
– declares the headline in the Newcastle Journal, and continues:
Schools are failing to encourage children to consider a career in manufacturing – and the economy of the North East may suffer as a result, a major new study has found.
Pupils in Sunderland are not being given the advice they need to make an informed choice about their future career, said think tank IPPR North, with girls in particular failing to consider careers in science, engineering or technology.
Researchers from IPPR North worked with two schools in the city to examine the attitudes of pupils towards a career in manufacturing, and particularly in the automotive sector.
As part of the study, they arranged for pupils to visit Nissan’s factory in Sunderland, and asked them whether this had changed their attitudes towards manufacturing.
The think tank warned: “Employment avenues for young people are not being closed off so much as never being opened. A systemic lack of interaction between schools and businesses is restricting the career options of young people in Britain.”
The failure to interest girls in science, technology, engineering or maths – the so-called STEM subjects – was robbing the sector of potential future employees, said the report.
> With such high levels of local unemployment ? Pull the other one ! There is probably going to always be be more people than there are jobs, so hardly a lack of potential employees. Many of them will already have the necessery skills, and if they haven’t they could learn them… if the employers were willing to invest in a little training, of course. But that would probably bite into short-term profits.
It warned: “The lack of interest in post-GCSE STEM subjects and vocational education among girls is a cause for concern given that skills shortages in these sectors are looming.”
IPPR focused on the automotive sector because of its importance to the economy of the North East – and it said there is “evidence to suggest the automotive sector would continue to grow in the coming years”, making it even more significant. Around 1.5 million cars and commercial vehicles and three million engines are produced annually in the UK, and 70% of vehicles manufactured here are exported.
> Hmmm… and its not so long ago that call centres were being touted as the big new thing. Which they may have been momentarily, but as soon as the companies found they could transfer the work to low-wage (and thus higher profit) economies overseas, you didn’t see them for dust. Anyone want to bet the automotive sector wouldn’t do the same if it was deemed profitable ?
Nissan’s plant in Washington is Europe’s most productive car manufacturing site, responsible for one in three of all cars produced in the UK.
> It’s also generally understood locally (but unprovable) that Nissan don’t employ anyone over the age of 30. Not much hope for the older unemployed there.
However, the think tank warned that manufacturers were concerned about the lack of available skilled labour in the UK, which could limit future investment in the country.
> People aren’t born with the skills for a particular industry fully formed. What’s wrong with the companies involved training workers to the required level ? They always used to.
It also pointed out that “pay tends to be significantly higher for graduate engineers than for most other graduates”, but young people considering their future career were not aware of this.
> But not everyone can be a graduate engineer, nor is that the only job in manufacturing. Perhaps kids realise this. Or perhaps they just think there’s more to life than selling their souls to an industry that may up sticks and move abroad if they think it in their interests.
The study warned: “Given the importance of both good careers advice and business-school interaction in shaping the choices that young people make, it is essential that Government, schools and businesses take action to plug future skills gaps and change the perceptions of those who might potentially be attracted towards careers in the automotive industry, and in engineering more widely.”
> School are like government training schemes – you might get a nice certificate, but it does not prepare you for the world of work. But why blame the schools, it’s not their role to provide factory fodder, surely ?
Once again we seem to be rushing to put all the eggs in one basket – mining, shipbuilding, call centres, automotive … in a year or two the same claims will be made again about the next transient industry, and all the unemployed automotive workers will be told they dont have the right skills and so must retrain…and so on ad infinitum.