Monday, 14 October 2013

Labour, Rachel Reeves and welfare reform: the beginning of the end for reviving the contributory principle?

With Liam Byrne sacked as shadow DWP minister last week and replaced with Rachel Reeves, some people sensed this might be the start of a shift in Labour's welfare strategy.  Out with the old remnants of Blairism and in with Ed Miliband's new social democracy.

That optimism lasted until Sunday, when Reeves' first interview in the job was spun to the press as 'Labour will be tougher than the Tories on welfare'.  Little seems to have changed then: the policy is still the same (a guaranteed job for the long-term unemployed), as is the message (tough but fair).

I suspect that many on the left exasperate at the sales pitch on welfare, rather than what's actually on offer.  Providing paid work for all long-term unemployed people is a solidly social democratic welfare policy of the type the Tories don't like.  And realistically, Labour couldn't offer these jobs without some conditionality.  This is a fact of the landscape of political attitudes in Britain.  A majority of the public might welcome left-wing moves on the cost of living, but are simultaneously, resolutely small-c conservative on welfare.

However, perhaps the most interesting point to note was Reeves' language on the contributory principle: a revived idea that's been floating around the centre-left for a few years now.  For some, the contributory principle is the mechanism by which Labour can revive support for the welfare state, yet Reeves' language was unforthcoming: 'we are not in an environment where there is more money around'.  

In all likelihood, this shift probably reflects Labour's weariness of introducing huge reforms to social security.  From the experience of Universal Credit, politicians know that changing the benefits system is far from straightforward.  A pledge to revive the contributory principle would soak up a lot of Labour's time, money and political capital.  There is also the (mistaken) mindset that public attitudes are inert and that it is beyond Labour's power to shift opinion on the welfare state.

So for now, Ed Miliband is playing it safe with welfare: his strategy is one of largely accepting the Coalition's position whilst highlighting small differences in what Labour would do.  Reeves' inteview seems to signal the end of Labour's flirtation with the contributory principle: the most radical centre-left suggestion of the past few years.  This is damage limitation but, as Mark Ferguson says at Labour List, it is a dangerous strategy: accepting and entering an 'arms race' on welfare will, in the end, blow up in Labour's face.

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