Jeremy Corbyn’s team had promised to reverse child tax credit cuts, but in their 2017 manifesto, they did nothing of the sort as the Institute for Fiscal Studies shows:
Corbyn’s manifesto planned to increase taxes by £46bn per year and to borrow an extra £350bn. With so much extra funding, there was enough to honour their promises on welfare, so voters could be forgiven for assuming that they would.
In his first leadership election, Corbyn said: “Families are suffering enough. We shouldn’t play the government’s political games when the welfare of children is at stake”. This issue of welfare cuts is why he defeated his Labour rivals for the leadership, because they had previously abstained on a number of votes.
In autumn 2015, John McDonnell, his Shadow Chancellor, didn’t just commit not to implement these cuts, he promised to reverse those that had already happened: “We are calling on Osborne to reverse his decision to cut tax credits. If he doesn’t reverse these cuts, we’re making it clear that we will”.
Three weeks before polling day, Corbyn said to Jeremy Paxman, “I am fighting this election on … the levels of poverty in our society, … children that are not supported properly in our society. I’m fighting this election on social justice” (7.15 mins in). Yet his manifesto was proposing to implement £9bn of the £13bn/yr of planned Tory cuts to benefits.
Over the years, Corbyn supporters have hurled endless abuse at Labour moderates, they have called them Red Tories and Tory-lite. They have accused them of selling out, of adopting Tory policies in a cynical game of triangulation. Yet on Corbyn’s policy on welfare during this last election, they were strangely silent.
The Liberal Democrats have been under constant attack too, accused of being Yellow Tories and Tory enablers. Many Lib Dem members have found this deeply painful, after all, there were deeply unpleasant cuts to welfare in the time of the Coalition, some of which the Lib Dems now propose to reverse.
In 2010, the government was borrowing one pound for every four pounds it was spending. Experts worried that, if no coalition were formed, the markets would panic; that, even if a coalition were formed, if serious action on the deficit was delayed, there was still a risk of panic. Panic could mean lenders refusing to provide loans at a reasonable rate of interest. If this happened, it would be extremely difficult to keep the government finances going. The UK might be forced between the choice of much harsher cuts, or a very large increase in inflation.
Did the Lib Dems make the right call in supporting cuts to government spending, and in making compromises in coalition with their tradition political opponents? There has been much angst among Liberal Democrats on that question. Even those who think they made a mistake, mostly agree that it was an extremely difficult dilemma.
This year, Corbyn faced no such dilemma.
In 2010, the country had a structural deficit of 5.3% of GDP, now it is about 0.9% of GDP. From 2010, the Liberal Democrats were the minority partner in a coalition, and had only 57 MPs out of 650. In contrast, Corbyn’s manifesto was not for a coalition, but for a government with a Labour majority.
In 2015, the then Labour leadership argued that Labour should adapt its policies to public opinion. If Corbyn now conceded that they were right, his attitude would not be hypocritical. However, he and his supporters have done little but rail against what they call the “neoliberalism” and the “pro-austerity” policies of previous Labour leaderships. They claimed that moderates were only interested in power, and had sold out their principles.
The Tory welfare cuts, which Corbyn and his allies are proposing to implement, are cuts to benefits that were raised by the New Labour government of 1997. So, as far as welfare provision for those on low incomes is concerned, Corbyn is now well to the right of Blair’s government.
Many have said that the proposed Corbyn cuts are too harsh. Bizarrely, the so-called neoliberal Economist thinks that Corbyn’s manifesto was too regressive on welfare.
These are the same cuts that the Lib Dems vetoed during the Coalition, because they thought they were too cruel and regressive, and why the 2017 Lib Dem manifesto allocated funds so they would not have to be implemented. This means that, as far as welfare provision for those on low incomes is concerned, Corbyn is now to the right of the Coalition.
Instead, Corbyn’s team allocated £11bn/yr to abolishing university tuition fees, and unspecified sums to nationalisation of water, electricity and other services.
Perhaps, these welfare cuts in Corbyn’s manifesto were never intended to be carried out. If so, this raises two uncomfortable questions. Were they due to incompetence? Or he was playing the same sort of dishonest games that he has accused others of?
After the 2017 election, he is basking in comparative electoral success. But for those who are motivated by social justice, the idea that £9bn/yr of his funding promises were on the backs of the low paid must be a bitter pill to swallow.
(This article was first published in Liberal Democrat Voice)