How many people really had the opportunity to read the article that Ed Miliband wrote and understood and digested the contents.
I’m sure that the coalition will continue to play the blame game and as usual dismiss it without comprehending the current situation of cost of living standards for both lower, low and middle incomes which has a knock on effect on how or where they send their children to be educated and open doors to where they get their first job as to many of us can concur that this coalition are very much out of touch with the voters.
Their children’s prospects must also be urgently addressed, Mr Miliband added. The article comes as the monthly ICM opinion poll for The Guardian suggests Labour’s lead has been cut to 3% – in the same series of polls it was 5% in December and 8% in November.
Miliband, characterised by his opponents as an old-style left-winger, wrote that Labour would “rebuild our middle class”.
The Labour leader said the country could not succeed unless that middle class was strong and vibrant.
He said his long-standing message about a cost-of-living crisis did not just apply to those on zero-hour contracts and the minimum wage, but also to millions of families who never dreamed that life would be a struggle.
Among their concerns, he highlighted access to further education, good-quality jobs and secure pensions.
He said: “Our country cannot succeed and become collectively better off unless Britain has a strong and vibrant middle class.
“Indeed, the greatest challenge for our generation is how to tackle a crisis in living standards that has now become a crisis of confidence for middle-class families.”
Miliband said that as well as falling real wages and rising costs for items including food, childcare, energy and transport, the middle class was facing a more fundamental threat.
“The motors that once drove and sustained it are no longer firing as they used to,” he said.
“Access to further education and training, good quality jobs with reliable incomes, affordable housing, stable savings, secure pensions: they have all been undermined.”
There is little detail in the piece about how these problems might be corrected, although more announcements are promised in the coming days.
Miliband is due to give a major speech on the economy later this week.
Labour vice-chairman Michael Dugher told the BBC his party was talking about “the millions of hard-pressed families who are feeling the pinch” – people who felt insecure in their jobs, concerned about their income in retirement and worried about their children’s future, particularly their chances of being able to own their own home.
“They may be cracking open the champagne at the Treasury and saying ‘job done’,” he told BBC Radio 4’s The World at One.
“But they have no idea of the hardship facing families on low and middle incomes.”
It is further alleged that Labour will use a speech to refer the high street banks to the competition authorities immediately if it is elected in 2015, Ed Miliband is expected to say in a centrepiece on banking reform .
The party leader wants the proposed review by the Competition and Markets Authority (CMA) to complete within a year of the election, and anticipates it could lead to a breakup of the larger high street banks, such as RBS or Lloyds.
He is expected to argue that greater competition in financial services is central to restoring Britain’s long-term economic prosperity and providing consumer choice. The intention would be to give greater choice for consumers and to address obstacles preventing new players from breaking into the market.
One proposal is a cap on market share on the largest banks, but the party would not indicate whether it had a specific cap in mind. Labour officials would only say that a market share cap of 25% – as had been suggested in a leak on Tuesday night – was wide of the mark.
Miliband speech aims to show that he can develop his successful, but arguably fully mined, living standards agenda into policies that offer a wider route map to greater economic prosperity. He also hopes to exorcise Labour’s reputation for having left the City of London insufficiently regulated during its time in office.
But the party leader suffered an immediate political set back when Mark Carney, the governor of the Bank of England, said he was opposed to crude caps on the size of market share for banks.
Giving evidence to the Treasury select committee, a sceptical-sounding Carney told MPs: “Just breaking up an institution doesn’t necessarily create a viable or more intensive competitive structure.”
In an attempt to set the scene for his economic speech, Miliband tried in parliament to wrongfoot David Cameron by demanding that the prime minister prevent state-owned RBS to award bonuses to bankers worth up to twice their annual salaries.
The European Union has said that if a bank wants to award a bonus to double a banker’s basic salary it should be subject to a shareholder vote, although the proposal is being challenged by the Treasury on the grounds that it creates perverse incentives by removing the link to performance.
Cameron tried to sidestep the issue of the future size of RBS bankers’ bonuses by saying there would be no increase in the overall RBS bonus pool this year. He said that Miliband had “all the moral authority” of the Rev Paul Flowers, the disgraced Co-op banking chief, given the last government’s record on banking regulation. Downing Street said the total package of pay and bonuses at RBS had halved under the coalition government, from £3bn in 2009 to £1.4 bn in 2012.
Labour retaliated by saying this was a red herring. Chris Leslie, shadow chief secretary to the Treasury, said: “The house needs to know that RBS has been reducing the number of bankers on their roll by about 2,000 bankers in the last year. You’d expect their total pay bill to actually start to fall. So it should.”
Carney also challenged the Labour proposal on bonuses by telling MPs that he agreed with the assertion of the parliamentary commission on banking standards that the EU bonus cap was a crude way to try to control pay – although by contrast the business secretary, Vince Cable, urged RBS to show restraint.
However, Labour is convinced that it can make a strong intellectual case that the growing integration of UK banking is damaging to industry, and consumers, so justifying a reference to the Competition and Markets Authority. The party also hopes market reforms can prompt a greater emphasis on German-style regional banking in which longer-term commitment to industry is made.
A general reference to the CMA was nearly adopted by the cross-party banking commission chaired by the Tory Andrew Tyrie – but the idea has been rejected in the Commons by the government.
However, last July the Office of Fair Trading announced a market study on competition in banking for small and medium-sized businesses and said this review would help the CMA decide whether to hold a full inquiry.
The Labour leader is expected to draw heavily on the criticisms of the banking industry set out by the Tyrie commission, and argue that the recent Banking Reform Act failed to stop banks operating as untouchable vested interests.
Labour has said it wants an obligation on banks to provide a basic bank account for all customers, a review of seven-day current account switching, and a fiduciary duty of care, explicitly putting the best interests of customers first and foremost in the financial services sector.
The government argues that it has already handed competition powers to the Financial Conduct Authority and new players are entering the market. The coalition claims regulators are already in talks with 22 new retail banking operators – and only in September introduced measures aimed at introducing seven-day bank switching.
It also claims customer surveys show the “big five” high street banks – Lloyds, RBS, HSBC, Santander and Barclays – consistently gave less satisfaction than others. But despite that, the party notes, those banks’ market share has increased over the last few years. The big five control 85% of the current account market as opposed to 71% before the financial crisis – and 67% of mortgage gross lending compared with 38% before the crisis.
In a nutshell this is how I view things at present from this so called coalition our social security system has been transformed by the Tories into perverse system of social control. Government officials spy on people receiving welfare to make sure they are not ‘wasting’ their OWN money. The welfare state was built to provide security but degenerated into a punitive system based on distrust and shame. The Tory Workfare programs and the sanction regime have turned social security into a pitfall, instead of a safety net.
Poverty is fundamentally about not having enough money to meet your needs.. WE have a government that is taking money from those who have the least and handing it out to those that have the most.
So, it’s not about being lazy, feckless, or stupidity. It’s because of government policy that is about redistributing wealth, damaging the economy and destroying jobs, the Tories always create high unemployment, and then blame the jobless victims. The government have cut our social security and public service support to the bone with catastrophic consequences for the poorest and most vulnerable. And they know what they are doing, that it is detrimental to our citizens and are preparing for a backlash, hence the discussion about water cannons and the attempts at a Gagging Bill.
Benefits don’t make people lazy, which are a conveniently manufactured Tory myth, to justify their eagerness to destroy the provision that we have paid for ourselves.
The Tories know that you can’t pull yourself up by your bootstraps if you have no boots. Despite what they tell us. and peddle in the media. But they don’t care, and will carry on stripping our support, and handing the money out to the wealthy, creating absolute poverty on the one hand, and obscene wealth for a few on the other. That’s why they are talking about water canons.
David Cameron performance in Parliament over bonuses for RBS eposes the Conservatives and LibDems as hand in glove with the banking elite. His statement of intent to continue the existing £2,000 cap on cash awards is meaningless since bonuses paid in RBS shares are simply deferred cash rewards.
Equality meaningless his commitment to veto any proposed increase in the overall pay and bonus bill at RBS since the workforce has shrunk by 40,000 including 2,000 investment bankers since the finance sector’s self-inflicted crisis began in 2008.
The real shame if this reduction in posts is that the price of excess and recklessness has been paid by staff with no responsibilities for creating the private sector banking collapse.
How strange that the Tories conveniently forgot to mention that they are known historically known for hiking up our basic survival costs. They do it every time they are in Office, and people struggle meeting their basic needs every time. The Tories inflict misery poverty on the population, it’s about time people recognised this and stopped voting for them. We have defeated them before – we need to be united and organised.
Yet Grant Schapps has the gull to be talking the usual Tory line on BBC Question Time he claims, as do all of the Tories, that ‘work pays,’ but not by increasing wages, rather, by taking lifeline benefits from the poorest.
How does that stand up to scrutiny? The consequences of this arse upwards, spiteful thinking are now very evident we have an enormous number of working poor, too. And people having their benefits stopped are dying in their thousands. It doesn’t even make sense, the stupid incoherent arsehole. I would love to see that directly challenged.
Right then Osborne seeing as you now agree with Labour you can go further and call for a living wage can’t you! Oh a rising it to £7 an hour in stages will have next to no impact on the people struggling through the cost of living.
This gimmick of course is just that as you will do nothing to address energy bills and you will do nothing to tackle while wages are behind inflation. So despite you thinking you have done some marvellous outflanking you have done next to nought.
Labour has been saying the minimum wage should rise above inflation, your rise just makes it to inflation not above it. So yet again smoke and mirrors from a man of spin.
Nice try Osborne but it will not win you the election.
Here is another example why we all can’t trust both the Conservatives and LibDems David Cameron’s is a government of naked class interest. Its leading party is the political wing of the City of London. For all its Liberal Democrat fig leaves, it is waging war on the poor while slashing taxes for banks, corporate giants and the richest people in Britain. Its cuts have hit the most deprived, the disabled and women hardest.
In crucial ways the scale of its attacks on social security, service privatisation and falling living standards for the majority – Cameron’s coalition has outdone even Margaret Thatcher. Its austerity programme halted recovery for four years and has cut most people’s real terms pay deeper and over a longer period than at any time since the 19th century. Wealth is being energetically redistributed up the income scale.
This is the government of foodbanks, payday loans and the bedroom tax. None of that is, of course, very popular. So to divert anger from the top to the bottom from those who caused the economic crisis to its most deprived victims – Tory politicians and their allies have turned their fire on migrants and benefit claimants.
If they can convince enough people that the crash of 2008 and the stagnation since 2010 has been the result of too much welfare spending, rather than financial speculation and recovery-choking austerity, they’re in with a shout at the next election. In this task, they have the advantage of a mostly pliable media running a daily campaign against “welfare” and immigration.
Latest up has been Channel 4’s Benefits Street series about a deprived area of Birmingham, which kicked off with a Little Britain-style portrayal of unemployed claimants as criminals, scroungers and addicts. It’s only one of a string of such shows whose themes are the meat and drink of Tory tabloids.
The reality of the social security system George Osborne is now aiming to cut by a further £12bn is very different. Most goes on pensions, and far more is spent subsidising in-work poverty wages and insecure jobs than the unemployed. But the distorting mirror of the press and current political debate means that, on average, people think 41% of the welfare budget goes to the unemployed, when the real figure is 3% – and that 27% is claimed fraudulently, when the government’s own figure is 0.7%. That’s about £1bn, compared to an estimated £70bn of tax evasion.
Which gives a clue as to which class interest the government is most concerned to protect. To listen to politicians and the media, you’d think the only class left standing was the middle class. By definition, there must be something above and below this mysteriously undefined class, but almost nobody in public life wants to mention what it might be.
Across the world, corporate elites routinely hail the growth of a middle class as the elixir of development and civilisation. In the US, it has long been the only mentionable class in political life. Britain is going the same way. But contrary to the media mythology of “we’re all middle class now”, most people continue to regard themselves as working class – 60% in the most recent British Social Attitudes Survey.
Those words, however, almost never pass the lips of mainstream politicians. They’ll use all sorts of euphemisms, such as “hard-working people” (or “working people”, if a Labour politician is being especially daring) – the implication being that everyone else is somehow part of a feckless underclass. Only Ukip’s Nigel Farage, now fishing for disaffected Labour voters, uses the term regularly. For the rest, it’s as if to conjure up the reality of working-class Britain – including its traditional association with unions, solidarity and demands – might be too alarming for other sections of the population.
Ed Miliband has this week promised readers of the Conservative Daily Telegraph that Labour would “rebuild our middle class”, threatened by the living-standards crisis afflicting the majority in Britain. The rebuilding of the working class wasn’t mentioned, only “people on tax credits, zero-hours contracts and the minimum wage” – in other words, poorer sections of the working class.
Whether the Labour leader meant his “squeezed middle”, those on middle incomes (about £22,000 a year), deskilled professionals or the more affluent being displaced by the super-rich, he’s right that a winning electoral coalition for Labour has always been based on an alliance of working class and middle-class support. But to treat working-class voters as the captive “poor” would only risk increasing political alienation and the toxic appeal of the populist right.
The same goes for the other side of the class coin. If the middle class is being squeezed, it’s certainly not by manual or white-collar workers. But just as the working class has been airbrushed out of public debate, the ruling class responsible for the crisis still gripping Britain and most of the western world is also hardly mentioned in polite company – though it sometimes gets a walk-on part as the “elite”, or the “establishment”.
The crudeness of the class egotism and greed that has driven much of western politics in recent years means that can’t last. In fact, class politics has been resurfacing in different forms since the crash – from the Occupy movement’s targeting of the 1% to the rise of the left in Greeceand the election of the progressive Democrat Bill de Blasio as mayor of New York.
In Britain, the social costs being exacted on behalf of a failed elite means class is “the real dividing line in British politics“, as one Telegraph commentator puts it. Cameron and Osborne now insist they want to make small-state austerity permanent, and are threatening another £25bn of cuts as they demand welfare states be slashed across Europe. They’re hoping the current increase in credit and consumption will boost real wages before the election and soften the sense of a recovery for the rich – though there’s little sign of that as yet.
They’re also trying to push those Labour frontbenchers who want to “shrink the offer” to the electorate to embrace more cuts and austerity. That would be self-harm. Whenever Miliband has challenged corporate and elite interests, from the energy monopolies to Rupert Murdoch, his support has grown.
The government and their friends in the media want to turn people’s anger at poverty and insecurity against their neighbours. The alternative is to turn it against the bonus-grabbing bankers, tax-dodgers, rapacious landlords and employers who are actually responsible.
It is said in some quarters which I’m incline to believe that George Osborne may have stolen his thunder somewhat with a tactically timed non-pledge to possibly, maybe increase the Minimum Wage, but Ed Miliband still has a big speech to give today – and as suggested by leaks earlier this week, it’s on banking. The Labour leader will pledge that “under a Labour government, you will no longer be serving the banks. Instead, the banks will be serving you” – a noticeable ratcheting up of rhetoric against the big banks – indicating that they are to become Miliband’s latest “big bad” after all.
Ed Miliband wants to break up the banks, cutting them down to size, bring new competitors into the market to increase choice and value for consumers – and make loans easier to come by for small businesses. So far so good.
What we won’t see from Miliband though are any short-termist eye-catching gimmicks. This is a speech about the long term – a “state of the economy” speech – that predominantly serves as an indicator of Labour’s direction rather than offering pledges to the electorate. Whilst that might seem like a victory for those calling for Miliband to offer “transformational” changes rather than tinkering “transactional” promises, Miliband’s team have been clear that their intention is to offer both. Quite right, although the lack of a “transactional” offer to the electorate in this speech means it lacks a clear headline that can used on the doorstep this weekend. There’s no “energy price freeze” here, the changes proposed are real, functional, structural and significant.
This is a serious speech, short on short-term promises and long on long-term economic reforms.
The proposal which the Guardian got a scoop on days in advance, and Newsnight got close to on Tuesday evening – is that Labour will seek to increase competition in the banking sector, breaking up high street chains and introducing two new “challenger banks”, both of which will have a significant market share. (Miliband won’t say what the “cap” should be on bank size though – he’ll leave that to the Competition and Markets Authority). This is all very worthy and tees up Labour for a wide range of future interventions on the size and shape of the UK economy – but there’s no “retail offer” for voters here.
That probably means it’ll be overlooked by the media and ignored by the public – even though the changes being proposed are pretty radical.
This speech seeks to make the big economic argument that will set up the election framing the party wants to adopt. Labour wants to make big changes to the economy, more competition, less market dominance, better wages and a less exploitative banking sector – that’s their “long term economic plan”. Meanwhile, the Labour leadership argue, the much-trumpteted Tory economic plan isn’t a plan for the economy at all, it’s a plan for the deficit.
You can expect Miliband to make much of the difference between the Westminster economic dialogue – focussed on figures and graphs – and the rest of the country, which is focussed on debt, wages and costs. It’s intended as a riposte to the Tory argument that the economy has recovered and prosperity is returning – but it could also serve as a rebuke to a press who are too in thrall to ONS charts, and too distant from the reality of keeping the lights on in Crewe, Altrincham or Glasgow.
Miliband will also seek to pull together many of the arguments he’s been making over the past few years – predistribution, Living Wage, predators and producers – to make a bigger argument. Whilst the Tories think the crisis was about the size of the state, Labour thinks the crisis is about how the economy works.
As they plan to reshape the British economy, Miliband and his team have taken inspiration from an usual source the “American Progressives” at the turn of the last century. They sought to hit back at uncompetitive markets that “hurt the little guy”, now Miliband is seeking to show that a British centre-left party can do what an American centre-right party once did so successfully. Just don’t call him Teddy Miliband (or Eddy Roosevelt).
What concerns many of us though about this speech is how the debate kicks on afterwards. This is a “big speech”, but it also feels another exercise in intellectual heavy lifting of the kind Labour has been doing for a while now. Long-termism is good, but if you’re talking about a cost-of-living crisis people also want to know what will put pounds in their pockets. Breaking up the banks is important – but it needs to be followed by the kind of tangible changes that people feel will make them better off. The smart thing about the energy price freeze was that it was a short term “transactional” offer (keeping energy bills down for two years) backed up by a long-term “transformational” change (smashing up the energy market and ensuring genuine competition). This announcement is long-termist, smart, and good for consumers. The only question Miliband has yet to answer though, is how will this make us all better off in the short-term?