The Observer view on the Queen’s speech
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Version 0 of 1. David Cameron last week used his first Queen’s speech of the parliament to claim he will lead a “one nation” government. But at its heart was a legislative programme that will embed a growing divide between the two Britains, rich and poor, that Disraeli identified in the 1840s. And far from commanding the support of the whole nation, its measures on civil liberties are controversial even within Conservative ranks. A one-nation economy must be based on the principle that those who contribute to the country’s growth share fairly in the gains. Britain’s recovery from the financial crisis has been fragile, lagging far behind previous recoveries. Wages have been stagnant in recent years and the labour market suffers from a high proportion of low-paid workers. These are the issues any one-nation economic agenda must address. But beyond a bill to slash £10bn worth of regulatory red tape by 2020, a long-standing Conservative obsession of questionable merit, there was surprisingly little on productivity and shared growth. Austerity remains the primary focus. The Queen’s speech announced further cuts to benefits and tax credits, critical to people working in jobs that don’t pay enough to support their families. They will come on top of cuts made to the welfare bill in the last parliament, three quarters of which were borne by families in work. These cuts far outweigh the modest increase in the personal allowance: five million low-paid people don’t earn enough to benefit because they don’t pay tax at all, and better-off families stand to gain the most. But the Queen’s speech contained more of the same: a provision that anyone working 30 hours a week on the minimum wage will pay no income tax, little consolation to families with children facing cuts to tax credits. Young people have been worst hit by the recession: their real wages have dropped by almost 13% since 2009, compared to 7% for the 50-plus. Too many of them are being forced to work in unstable jobs, if they can find work at all. The scarring impacts of circulating in and out of poor-quality jobs early in a career last a lifetime. But instead of investing in the type of youth jobs programme proved to be effective in countering these effects, new legislation will impose a six-month limit on out-of-work benefits for young people, with many forced to do compulsory community service. There was little on the longer-term labour market challenges facing younger people. The dire state of our vocational system leaves too many who don’t go to university with poor job prospects. New legislation will require the government to report annually on its three million apprenticeship target. But expansion to date has included too many poor-quality apprenticeships, mostly taken up by older groups. Big questions remain about how to improve the British school to work transition in a way that works in our service-sector economy. The rapid expansion of a mixed-quality apprenticeship system in the context of limited employer demand can only be a part of the answer. Otherwise all we will see is a further watering-down in apprenticeship quality. In a world of stagnating wages, trade unionism could have an important role to play in helping to secure fair pay. The impact of skills-biased technological change on growing inequality is well documented, but it has been augmented by the decline of collective bargaining. Yet the trade union bill will further erode collective bargaining rather than encouraging its expansion across the private sector, where membership rates remain low. High minimum turnout thresholds for strike ballots, together with a ban on unions using online voting, will in effect neuter the threat of strike action, weakening pay negotiations: bad news for wages in unionised sectors. Moreover, the bill forces unions to make member contributions to their political levies opt-in, in an effort to erode union contributions to Labour, while leaving Tories free to solicit donations from businesses with no transparency over their influence. This outrageously lopsided approach is undemocratic and no answer to the need to clean up party funding, which can only be achieved through state funding of political parties and much tighter rules on donations of all kinds. On housing, the government’s new right-to-buy scheme flies against what needs to be done to fix the nation’s housing affordability crisis. It beggars belief that rather than setting out measures to make achievable the ambitious housebuilding targets that all the parties signed up to pre-election, the government is instead proposing to sell off affordable housing stock at a discount in echoes of the Thatcherite 80s. While there was good news in the expansion of free childcare entitlement for three- and four-year-olds, its implementation is not without risks. The rates the government pays to providers for the free entitlement are too low; in practice, many providers cross-subsidise the free hours with what they charge parents for the rest of the week. There remain areas with insufficient provision of the free entitlement for all children to take it up. The danger is that the government makes expansion possible by relaxing regulations that have been crucial in ensuring quality that childcare plays a role in improving outcomes for children from poor backgrounds. This would be a huge step backwards for social mobility. The decision to hold a referendum on the EU is the right one. But if Britain votes no, the consequences for investment and growth could be disastrous. There are important lessons from the Scottish referendum: the No campaign will make an emotional appeal to nationalism. The Yes camp cannot counter with a technocratic case based on dry statistics, but will need to run a campaign fronted by businesses, universities and others in civil society. It is civil liberties where the Lib Dem absence from government is making itself most felt. The intention to scrap the human rights act is a populist, dangerous and legally unsound move. It has been criticised strongly by Cameron’s former attorney-general and other senior Conservatives, and should be dropped. The investigatory powers bill gives law enforcement agencies sweeping new powers to target online communications, with no indication of what oversight there will be to hold these powers in check. The extremism bill gives Ofcom powers to intervene against channels that promote extremist content, a measure even Sajid Javid refused to support as culture secretary because of its infringement of free speech. This was not a one-nation Queen’s speech in the Disraelian tradition. It was the Queen’s speech of a government unconcerned about shared prosperity, the next generation and basic civil liberties. Cameron’s misappropriation has consigned “one nation” to join “hard-working families” and “aspiration” in the dumping ground of overused political banalities: vague monikers liberally peppered through speeches – but devoid of meaning. |