• Tories out – scrap Universal Credit
  • Fight for living wages and benefits
photo Dan Moyle/CC

photo Dan Moyle/CC   

Thanks to David Maples, Lambeth and South West London Socialist Party for this article

What is the real problem with Universal Credit? It’s constantly in the news, with politicians criticising delays in payment and design flaws. But most do not address the fundamental issue: austerity.

The Universal Credit benefit system is part of the general Tory onslaught against the welfare state. The Socialist Party stands opposed to all these attacks, not just the worst features of them.

And some of the features of Universal Credit have yet to be widely publicised.

After decades of losing ‘proper’ jobs, many workers have had to resort to some kind of self-employment. They will soon be subject to the ‘minimum income floor’. This assumes self-employed workers earn at least the minimum wage – regardless of actual earnings, which are often lower.

Universal Credit also includes punitive provisions aimed at forcing workers to increase their working hours – regardless of personal circumstances such as care responsibilities, or whether the additional work even exists.

Profit

These attacks are about propping up capitalist profit. Between 1966 and 1982, unemployed workers could get an earnings-related supplement to their unemployment benefit – up to 90% of previous earnings.

But having seen the potential strength of the trade union movement in the big battles of the 1970s, Margaret Thatcher’s newly elected Tory government had a high priority of creating unemployment to try to weaken union power.

An overvalued pound made it harder to sell overseas. Combined with British industry’s legacy of low investment levels – compared with rival capitalist economies like high-tech Germany – this resulted in mass redundancies.

Unemployment increased to three million. Against this background, the Tories wanted to reduce benefits to increase competition for jobs – to help drive down wages and restore profits.

Unemployment and underemployment are inherent within any economy based on market competition. Overall they are the fault of capitalism, not individual workers.

New system

A new welfare system needs to take this as its starting point, and also form part of a programme to replace profit-driven jobs chaos with democratic socialist planning – jobs for all. The Blairites instead pander to Tory ‘benefit scrounger’ myths because they defend the capitalist system.

A new welfare system must be based on a reasonable standard of living for claimants. Pro-capitalist politicians may criticise elements of Universal Credit. But they don’t criticise the derisory level of benefits, exacerbated by the Tories’ four-year in-work benefits freeze.

A new welfare system also has to have adequate administrative resources. PCS, the trade union for benefits workers in the Department for Work and Pensions, is calling for an extra 5,000 staff and a freeze on Universal Credit roll-out until its administrative disasters have been resolved.

Funding to advice bureaus, law centres and legal aid must be restored, so claimants can get help to receive their full entitlement.

Most urgently, Labour councils should use their existing financial powers to ensure no one is evicted, cold or hungry because of Universal Credit.

Jeremy Corbyn should promise to reimburse councils which underwrite all Universal Credit losses if he takes power. This could make the system unworkable, hasten the downfall of the Tory government, and prove to working-class voters that Corbyn is serious about fighting for them.

Tories out – scrap Universal Credit – fight for living wages and welfare. £21 billion a year in unclaimed benefits is the real scandal in the welfare system.

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