Why the social security system is vital to low paid workers

As we await the assault on working people in the first Tory budget next week, new data points to better ways of supporting the low paid and reducing inequality.

The Joseph Rowntree Foundation has published its annual research on the The Minimum Income Standards (MIS), which asks members of the public what goods and services they think different types of households need to live to an adequate level. They turn this into a useful calculator that lets you compare your income to MIS.

The pause in inflation helped people on low incomes to become slightly better off relative to their needs in 2015, despite working-age benefits and tax credits rising by only 1 per cent. However, households on low incomes remain much further behind what they need than before the recession. The gap between family incomes and what the public think people need for an acceptable living standard has grown sharply.

The earnings required to achieve the MIS for a single person stayed stable at £17,100 a year. Earnings requirements fell for families with children, helped by a small increase in Child Benefit and tax credits. A working couple with two children must each earn £20,000 to reach MIS.

A predicted return of modest inflation combined with a planned freeze in benefits, tax credits and Universal Credit will create a less favourable environment for households reliant on help from the state. The July 2015 special Budget is likely to make matters much worse.

The Institute of Fiscal Studies(IFS) has published a short analysis of the annual DWP statistics on the distribution of household income.

After inflation, median (middle) income grew by just under 1% in 2013–14, following a similarly small rise in 2012–13. This represents a slow recovery in average incomes, which follows the sharp decline between 2009–10 and 2011–12 when workers’ real earnings fell rapidly. It did mean that real median income had crept back to within about 1% of its pre-recession (2007–08) level, though it was still almost 3% below its 2009–10 peak.

In 2013–14 incomes grew at a similar rate across almost all of the income distribution, resulting in little change in income inequality. At 0.34, the Gini in 2013–14 remains at around the same level as in the early 1990s, but lower than before the Great Recession. This is largely explained by the fact that while real earnings fell sharply between 2009–10 and 2011–12, benefit incomes were more stable. Since poorer households get a greater share of their income from benefits, their incomes have risen relative to higher-income households. However, once you take account of falling mortgage payments, overall inequality fell less than those numbers suggest since it is largely better off households who benefited from this reduced cost.

The latest data show little or no change in poverty rates, for the population as a whole and for the major demographic groups (pensioners, working-age adults and children). However, as IFS warns, we need to look at trends over several years.

We also need to look at how geographical is the wealth gap. The richest place in Scotland is a third better off than the poorest. ONS data shows that gross disposable income averages just over £20,000 a year in Aberdeen and Aberdeenshire and in Edinburgh, compared to just under £15,000 a year in Glasgow and North Lanarkshire.

As we approach the special budget and the likely attack on social security for working people, the TUC and the Child Poverty Action Group (CPAG) have urged ministers to improve Universal Credit rather than raising the income tax threshold to £12,500. In a study of 13 options, the tax threshold proposal cost the most and came bottom for reducing child poverty. A package of improvements to Universal Credit including increasing work allowances, would reduce child poverty by 460,000.

Alison Garnham, chief executive of the CPAG, said: "This comprehensive analysis shows the Chancellor must be careful not to back the wrong horse when it comes to the Government's flagship policies. Rather than committing billions on the costly and poorly targeted policy of raising the personal tax allowance, the Treasury should stop starving universal credit of the investment it needs to fulfil its poverty-reducing potential and justify the massive upheaval surrounding it. The evidence is clear that investment in tax credits is incredibly effective in lifting children out of poverty."

While increasing wages remains hugely important, these reports highlight the importance of in work benefits to families in particular. Despite the 'strivers' rhetoric, these are likely to be the biggest losers next week.

 

 

Welfare devolution

In the midst of a political offensive on devolution, the IPPR paper on devolution of welfare is well worth a read. Not least because it reflects trade union and Red Paper Collective arguments on this issue!

The big beasts of Westminster have been queuing up in recent weeks - to at least appear to urge Labour to be bold on devolution. All while the Devolution Commission haggles over the fine detail of their report to be presented to conference next week.

Douglas Alexander entreated his colleagues in the devolution commission to, "range widely and to act boldly. That means in considering taxation, employment and skills policy, the responsibilities of the Crown Estate, the running of elections."

Then Jim Murphy, not known as an enthusiast for greater devolution, made a speech saying, "further meaningful devolution to Scotland is compulsory". All the more surprising after his sidekick, Ken Macintosh MSP, condemned further tax raising powers, claiming an income tax deal could lead to 'independence by default'.

Then the biggest political beast of them all, Gordon Brown, weighed in this week with six changes including tax powers, he said:

"I believe there are six constitutional changes we have got to make for a better relationship between Scotland and the rest of the United Kingdom, to turn what I would call a unitary and centralised state of the past into a partnership of equals and one where there is power-sharing across the United Kingdom."

I would also give an honourable mention to Menzies Campbell and the second report of the Lib Dem’s own devolution commission. I don’t agree with it all, but it is a positive contribution to the debate.

The IPPR report is interesting because welfare rarely gets much of a mention in the devolution debate. The key elements of their report include:

·      There is no strong argument for devolving those benefits which are core to the UK’s social union, including job seeker’s allowance, employment support allowance and the state old age pension.

·      Devolution of some aspects of welfare would not just supplement the powers of devolved governments, but would also improve social and economic outcomes in the devolved nations and enable the formulation of more joined- up public policy.

·      Housing benefit should be devolved, given how closely it is linked to other aspects of social housing.

·      The Work Programme should be devolved to enable a joined up approach to job creation.

·      Devolution of the childcare element of the working tax-credit is an option that would also boost the expansion of childcare provision.

·      Benefits that have a direct interface with devolved social services should also be devolved. This particularly applies to attendance allowance.

·      Devolved governments should be given a general power to supplement UK levels of welfare, so that they can use cash payments as well as other policy levers to deliver social policy.

Of course all of this is fine and dandy, but powers have to be for a purpose. As I put it in my Scotsman article on procurement this week, "So far so good. However, the real question is what’s the point in spending two years debating which powers should lie where, when we are not even brave enough to use the ones we have to build the progressive country we all say we want?"

Fuel poverty - better or worse in an Independent Scotland?

Fuel poverty – better or worse in an independent Scotland? That was the question posed to a panel I participated in at the Energy Action Scotland annual conference today. I covered some of the issues in the energy chapter of the latest Red Book and I remain pretty sceptical that the independence on offer will make any difference. And by independence I mean the likely Scottish Government offer, not a wish list from others in the Yes camp who have no political road map for implementing their vision.

Fuel poverty is an everyday reality for many people in Scotland with older people, those with disabilities or long term illnesses and those on low incomes, especially at risk. The consequences are misery, discomfort, ill health and debt. Around 900,000 households in Scotland – more than 1 in 3 – are estimated to be in fuel poverty, which means they are unable to afford adequate warmth in the home. The causes are a combination of poor energy efficiency of the dwelling, low disposable household income and the high price of domestic fuel.

Energy efficiency is of course already largely devolved and measures have been introduced by successive administrations since 1999. We can argue about the scale and effectiveness of those measures, but the solutions are already in our own hands.

Low disposable income is largely a reserved matter, as it is closely linked to the welfare system and broader economic policy. The shift from wages into profits since the Thatcher era is a major concern, not just for fuel poverty, but also because of the wider economic impact. The UK economy grew by £60bn over the past four years, yet household disposable income per person dropped by £500. That's why the cost of living and wages is a rising political issue. In theory independence could make a difference here, as I don't believe the Scottish Parliament would have countenanced many of the current welfare cuts and the Bedroom Tax in particular.

However, I remain sceptical that the independence on offer indicates a radical shift in policy. Scottish Government support for the Scottish Living Wage is a positive indicator that they get the importance of increasing disposable income, although their reluctance to use procurement to extend the scope is a big negative. The broader case for a rebalancing of the economy doesn't feature much in SNP thinking and their economic polices remain firmly in the neo-liberal camp. The language on welfare reform is positive, but there is no indication that they are prepared to take any radical action on tax to pay for it. In fact quite the opposite. Their actions in government, such as the regressive Council Tax freeze and post-independence tax announcements indicate a low tax economy. You simply can't have Scandinavian levels of welfare and public services unless you are prepared to have a difficult conversation on tax with the people of Scotland.

That leaves the issue of energy policy, vital because the price of energy is the biggest driver of fuel poverty. Now, I am a big critic of the UK Government's energy policy and supportive of many of the Scottish government's concerns, as in Fergus Ewing’s rant to the Energy Secretary this week, particularly transmission charges and decarbonisation targets. I therefore find the Scottish Government’s position on energy policy post-independence surprising, to put it mildly. Despite their criticisms they want to remain within the UK electricity market.

This effectively means handing over the key levers of energy policy to another country, taking independence lite to new levels. There's nothing that says the UK has to use renewables to meet emissions targets – or, more importantly, Scottish renewables. There are alternatives, such as rigging the market to favour English nuclear stations – oh yes, they have just done that!

The Scottish Government energy minister Fergus Ewing responds to this by pointing to the EU single market and cooperation models such as the Irish SEM. He also argues that UK ministers would end up accepting a continuation of the current single energy market across the UK after independence, on the grounds that, without Scottish energy feeding into the national grid, the “lights would go out” in England. This is a pretty bold claim with not much evidence to support it, given the Chancellor’s ‘dash for gas’ through fracking and England's access to the continent’s power supplies through interconnectors.

Developments in interconnector access are another blow to Fergus Ewing’s argument. The Scotland-Norway interconnector is running into difficulty after SSE pulled out and the Norwegian state grid operator appears more interested in a link to England. National Grid’s submission to the Commons Energy and Climate Change Committee said England and Wales could meet their renewable and carbon emissions targets without any contribution from Scotland.

I might be persuaded if the independence on offer was a planned energy policy that provides safe, secure and sustainable generation, which contributes to the economic future of Scotland and eliminates fuel poverty. This should include a more diverse generation ownership model and a bigger role for local government as we see in parts of continental Europe. Not to mention public ownership. Even a majority of Tory voters now favour renationalisation of energy companies. In Scotland, energy generation is dominated by big business and I don't see any willingness to tackle that issue. Fergus Ewing's rush to parrot the energy companies response to Ed Miliband's price freeze, indicates another status quo position.

In conclusion, I accept that it is possible to pursue different energy, economic and welfare policies under independence that could seriously tackle fuel poverty. The primary requirement as ever is political will. However, the proximity of almost the only energy trading partner creates real challenges for those advocating independence and they will need to do much better than, ‘the lights will go out in England’ if they are going to convince me of the merits of their case. A balanced energy strategy that ensures security of supply, builds a more diverse industry and eliminates fuel poverty, would be a good start.

Workfare schemes ruled unlawful

I was on the BBC ‘Call Kaye’ programme this morning to discuss the Court of Appeal ruling that the UK Government’s “Back to Work” schemes are unlawful and the regulations must be quashed. The ruling is a big setback for the Department for Work and Pensions (DWP) who have driven the controversial reforms.


Predictably the Tax ‘Dodgers’ Alliance also turned up to tell us that this was a wonderful scheme in the interests of taxpayers and the unemployed. As a business funded organisation the provision of free labour was obviously just a bonus!

Well it isn’t a wonderful scheme and these are the main reasons why:

• In the broadest sense of the phrase this is forced labour. The Community Action Programme, Work Programme and Mandatory Work Activity Scheme (the clue is in the name) are mandatory schemes and jobseekers will lose their jobseeker’s allowance if they do not participate.

• Job Seekers Allowance (JSA) is paid to support people whilst they seek employment. It is not payment for work, not least because the hourly rate would be as little as £1.78 per hour.

• The UK government’s own international research shows it doesn’t work when unemployment is so high. Youth unemployment in Scotland has doubled. Their study said, “Workfare is least effective in getting people into jobs in weak labour markets where unemployment is high.” There is also no evidence that these placements turn into significant real jobs.

• In practice it’s simply job substitution, often for large profitable retailers. Better employers have pulled out because they don’t want to be associated with it. Glazing firm CR Smith are quoted in today’s Herald, "If we are to give people, and particularly young people, a meaningful work experience, it should be through a proper paid job. The sense of reward that comes, in part, from being paid for your efforts is fundamentally important to anyone's motivation to strive to do more." Very well put.

• Substituting forced free labour for waged workers damages the economy.

• The schemes do not simply apply to the long term unemployed, so the argument that it gives the unemployed some sort of focus doesn’t apply. People who rightly feel they are being exploited are not being motivated. And by the way, the scheme doesn’t apply to ‘benefit scroungers’ because they are debarred from these schemes as they are not seeking work.

So let’s get the facts right. Full credit to Public Interest Lawyers for supporting the pursuers in this case. And to the callers on this morning’s programme, who told us of their own experiences of being exploited on these schemes.

Welfare cuts

I was speaking at an Edinburgh Trades Union Council event last night on the impact of welfare cuts. Part of a series of meetings to take forward the STUC's 'A Just Scotland' initiative.


For the decade up to the 2008 crash there were measurable improvements in welfare support for children and pensioners. Child poverty in particular was reduced, even faster in Scotland than in England as the recent Rowntree report on poverty in Scotland highlighted. This did not, as the Tories would have you believe, result in a welfare budget that was spiralling out of control. In fact as a percentage of public spending, welfare spend had reduced compared to 1997.

However, this was not a sufficient response to poverty in Scotland or across the UK, certainly for the working poor. It still leaves today;

• 780,000 (15%) of Scots in relative poverty and 490,000 (10%) absolute poverty;

• 658,000 households (28%) living in fuel poverty;

• 90,000 under 25 year olds unemployed. That’s doubled since 2008;

• for the rest part-time and self-employment is masking the true levels of unemployment;

• The number of low-income, working families has increased from 125,000 to 150,000

The consequence of this is growing inequality with a 14 year life expectancy gap between those living in the most deprived and least deprived areas of Scotland.

Putting the wider impact of austerity economics aside, it is about to get much worse. Major welfare cuts are to be imposed at time of weak job prospects and underemployment, especially for young people.

The main driver is the introduction of Universal Credit. Seven in and out of work benefits are to be combined including; Income Support, Job Seekers Allowance, Employment Support Allowance, Housing Benefit, Child Tax Credit, Working Tax Credit, Support for Mortgage Interest.

The UK government claims this will simplify the benefit system. In my view sticking benefits together is not simplifying. This is an all or nothing reform. If something goes wrong it could cut the sole source of income to vulnerable people and the complexity of the IT systems makes that distinct possibility. To that you can add:

• monthly payment in arrears;

• A household payment not individuals that will leave vulnerable women particularly exposed;

• Digital by default for groups that have limited computer access.

And all that’s before straight cash cuts by:

• increasing benefits in line with CPI, a lower measure that will impact on 200,000 children, 300,000 adults;

• uprating by only 1% a measure that alone will drive a further 200,000 children into poverty across the UK;

• switch from DLA to Personal Independence Payments with 20% budget cut;

• 60,000 Scots will lose some of current DLA mobility component;

• families with two children will lose £1079 by the end of 2015. The Labour Party has also added up cuts to child tax credits, the three-year freeze on child benefit, the 1% cap on the rise in statutory maternity pay and the abolition of the maternity grant - into a £1700 'Toddlers Tax'.

Let's also not forget the economic consequences. There are 570,000 benefit recipients in Scotland. These cuts mean £2.5bn taken out of Scottish economy. Money that would be spent locally supporting businesses and jobs.

Then we have the rhetoric – strivers and skivers.

This seeks to play to a perception of public opinion. As recent NatCen research shows the public is sceptical about impact on recipients, believing that some are more deserving than others. Many of these perceptions are actually wrong. For example most people support welfare for children although 68% think they are in poverty because their parents are addicts. More worrying for the ConDem's they still see the Government, not individuals, as being responsible for welfare. These perceptions appear to apply to the company delivering the Welfare to Work programme. According to a piece on GMS recently they described clients as ‘lying and thieving’.

The reality is somewhat different from public perception:

• the biggest losers from the 1% uprating are people who are employed;

• benefits for unemployed constitute only 4% of the welfare budget. Only 8% claim for more than a year;

• 60% of the welfare budget goes on pensioners.

Then we have that other myth, welfare fraud. That actually costs only 70p out of every £100. Compare that to the £120bn tax dodging by the rich.

It is also argued that we have a culture of worklessness that welfare reform will tackle. This is another myth the JRF Study in Glasgow & Middlesborough shows. There was no evidence at all as two generations of claimants are rare (0.3%) and not surprising children don’t want to follow their parents down this route. Oh and by the way, only one-third of incapacity benefit claimants were long term.

The architect of all this is Ian Duncan Smith. Some will remember him coming to Easterhouse eleven years when he was the Tory Party leader to meet Bob Holman and learn about poverty. He said and did some interesting things for a Tory, driving compassionate Conservatism. I would recommend Bob's interview in Holyrood Magazine to see what he thinks of IDS today!

Poverty is as real for those in work and if this is the route out of poverty then work has to pay. However, real wages are falling while the combined worth of the country's 1,000 wealthiest people is £414bn, up 4.7%.

I have focused in this post on the impact of UK Government policy, because I believe the impact is not fully understood. One in four Scots could be in poverty by end of decade. However, finally I will look forward.

The Scottish Government has done some small and useful things to mitigate the worst effects including; passported benefits, covered the Council Tax Benefit cuts for one year, the Scottish Welfare Fund and extra funding for advice agencies. Perhaps more worrying for them is that two-thirds of Scots think they are responsible for welfare benefits! But we need a more radical approach at all levels. At its basic level it's simply about raising incomes creating the sort of fairer and more equal society that underpins the Just Scotland approach to constitutional change.

The problem is not devising a constitutional arrangement. You could envisage an independent or devolved set of powers and then produce a wonderful vision of the sort of welfare system many of us would wish to see - largely on the Nordic model. The problem is political will. There is no indication that any of our political parties are yet ready to have the necessary conversation with the voters about the taxation system needed to sustain a Nordic model of welfare.

To be positive all is not lost on this issue in Scotland or even in the UK. The Scottish Government has taken some small actions as I have set out above. I will also pay credit to Ed Miliband for challenging the Tories on welfare cuts when there were those in the Party, armed with polls and focus groups, arguing that Labour should duck the issue. As TUC research has indicated public opinion is also changing and that can only move in our direction as the cuts bite. Remember, there is much worse to come as Cameron and Osborne seek to dismantle the state and reduce welfare to the most basic of safety nets.

There will be no quick fixes, no vanguard actions by trade unions or others. Instead we need to steadily build support for a better way.

UNISON Welfare Fun Day

Yesterday was UNISON Scotland's Welfare Fun Day, held at the Falkirk Wheel.

UNISON Welfare is our charity aim at helping members when they are struggling through an unexpected crisis, or if the pressures of every day life are getting too much. Recently rebranded as There for You  this charity offers a unique confidential advice and support service just for members of UNISON and their dependants. It helps thousands of members every year with financial assistance, debt advice, wellbeing breaks, support and information. UNISON is the only trade union to offer a confidential advice and support service to its members and their families in the form of a registered charity.

Sadly, there has never been a greater need for this service. Real cuts in wages coupled with an ideological attack on public services is creating an ever greater demand on the charitable sector to plug the gap. Welfare reform is adding to that burden with real cuts in support to those most in need.

It hasn't stopped Cameron and Osborne parading at the paralympics, and rightly getting booed. As Blind Team GB footballer Keryn Seal, who relies on his £70-a-week allowance to get to training said: “I find it quite incredible that the ­Government can go around handing out medals when away from the Games they are taking the DLA away. It’s all well and good backing disabled sports at the highest level and looking good for the cameras but what they are doing is going to affect hundreds of thousands of disabled people really badly."

So many thanks to the UNISON branches who supported yesterdays event and those who put a lot of effort into organising it. Not to forget those who turned up.

The Falkirk Wheel is also a great public service venue if you haven't visited it. The staff are great advert for the service. Thanks to them as well.

Welfare Reform Bill & Housing Benefit

The Welfare Reform Bill is back to the Commons this week at the Report Stage. One of the most dangerous provisions relates to including Housing Benefit in the new Universal Credit.

Under the current Housing Benefit rules, council and housing association tenants can choose to have their Housing Benefit paid directly to their landlord. There is also a provision, where a tenant is in arrears of rent by eight weeks or more, for the council to request that Housing Benefit is paid directly to the landlord. This is a vital provision that ensures that the rent is paid and not spent on other items. Tenants on benefits have a tight budget and with energy and other bills rising, there is a real risk of non-payment and growing rent arrears.

This will lead to the need to reinstate an army of rent arrears staff and could undermine the credit rating of housing associations who need to borrow to build new homes. Shelter Scotland recently warned that the Scottish Government's target of building 6000 new homes was already looking challenging. This will make it even less likely. The UK Government appears to believe that Direct Debit is the solution. It isn't. Many tenants don't have bank accounts and even if they do, Direct Debit doesn't guarantee payment of rent.

UNISON Scotland represents some 2000 staff working on Housing Benefit. It appears that the DWP believes it can administer this benefit through call centres instead of having local offices where Housing Benefit staff can speak directly to claimants, explain issues, answer queries and inspect documents (such as tenancy agreements) which otherwise would have to trusted to the post or scanned. There are real equality challenges for those with disabilities about losing local offices and staff and many vulnerable claimants may find it more difficult to access the Universal Credit system. More on this in our briefing to MPs.

The cuts in Housing Benefit will have a serious impact on many tenants in Scotland and across the UK. They are bad enough, but these administrative changes will have far reaching consequences for social housing in Scotland.

 

Housing Benefit cuts

Much of the noise around the changes to Housing Benefit proposed by the Con-Dem UK government has been the impact on cities like London. However, it is no becoming clearer that it will also have a serious impact on Scotland with some 60,000 households facing severe hardship.


The Scottish Government's Housing Minister has highlighted that in April, 55,000 households will be given nine months to either lose housing benefit or move out of their home. It will affect households who already pay the average price of rent in their area and will now need to find available accommodation in the bottom third bracket of rental prices. 7,500 young people, 25 - 34 year olds, are set to lose nearly £55 a week from April when they will no longer receive support for their own homes and will be forced into shared accommodation.


The Scottish Government has established an expert group to share knowledge of local impacts and to make the case for stopping the worst measures. Not surprisingly, the Scottish Government will also press for the devolution of powers on welfare and benefits. UNISON argued in its evidence to the Calman Commission that Housing and Council Tax benefits should be devolved, but not UK administered benefits.


These reforms could create poverty ghettos, punishing people for being unable to take up a job where no jobs exist. All in this together - again I think not.

UNISON Welfare

I spent a very pleasant Sunday with UNISON members, their families and friends in day of fun to celebrate the Centenary of the founding of the unique Welfare Fund run by UNISON in Dunfermline's Pittencrieff Park.

Members participated in a sponsored 5K walk around the park and took part in the various activities arranged for children and family members. The event was opened by John Park, Labour MSP for Mid Scotland and Fife.

Two enterprising members from our South Lanarkshire branch were sponsored for cycling the 60 miles from Hamilton to Dunfermline. Activities included bouncy castles and other inflatables, face painting, balloon modelling, children’s races, and a raffle to raise funds for the Welfare Fund’s Centenary Appeal. The new Labour MP for Dunfermline, Thomas Docherty made the raffle draw.

UNISON Welfare is a very special service that helps many thousands of members in difficulty every year. In the current financial climate this support could be even more vital in the future.

Solidarity Society

My travel reading this week has been the latest Fabian Society publication The Solidarity Society by Tim Horton and James Gregory. This is the final report of a project to commemorate the centenary of Beatrice Webb’s famous 1909 Minority Report of the Royal commission on the Poor Law. The central thesis of the report is by applying Webb’s values to contemporary Britain we can inspire a radical vision to fight poverty. That vision should be one based on equal citizenship.

The report gives us a detailed analysis of current welfare strategies to show how much decisions about universalism and targeting matter. The best example is the universal NHS that remains popular with all socio-economic groups. In contrast social housing has been increasingly targeted on the needy and equally important, spatially segregated from the rest of society. As a consequence is less popular.

This highlights the importance of public support for welfare funding. It has to chime with the public’s perception of what’s fair and harness our collective and cooperative instincts. Universalism and reciprocity is the way to achieve this. The report then sets out a range of specific measures that constitute a new welfare contract, shifting away from simply responding to need and back towards reciprocity where people earn entitlement through participation in society.

There is a net cost in the approach that the authors address through reform of the National Insurance system. Many will of course argue that given the state of public finances this is not the time. The ONS have published figures today that shows’ public borrowing has reached 61.7% of GDP. It is worth reminding ourselves that that in 1945 we had a national debt of over 200% of GDP and yet still created the NHS and implemented Beveridge.

So why does all this matter? It matters because Cameron’s Tories have a clear strategy to divide ‘the needy’ from the majority of society. Welfare and public services are to be a safety net while the majority purchase services from the private sector. There is a close alliance between this strategy and the burgeoning number of right wing groups promoting bogus research in support of this approach.

I was pleased to see that Harriet Harman will today pledge that inequality will be a clear dividing line between Labour and the Tories. This Fabian report gives some pointers as to how we could tackle poverty and inequality with a settlement that could permanently command public support.