Transcript Critique of the National Reform Program of United Kingdom

The UK National Reform
Programme: Achieving a
Balance?
ACW/MOC/ACV/CSC Conference
Brussels
19 September 2011
Balancing Economic & Social Policy

Poverty and Employment in the UK: recent
developments

The UK NRP – getting the balance wrong

The impact of the new Process – engaging
civil society

Priorities for tackling poverty – beyond the
NRP
Who we are

Poverty Alliance is the anti-poverty network in Scotland

More than 150 members, core funded by Scottish
Government, 9 members of staff

Key concerns are around low incomes, services to
address poverty, participation of people in poverty in
policy development and attitudes to poverty

Currently support the Scottish Living Wage Campaign,
Scottish Campaign on Welfare Reform, Stick Your
Labels stigma campaign

Also active in UK networks and campaigns as well as
with EAPN.
Recent Trends in Unemployment

After falling, unemployment has
begun to rise again, now stands
at around 7.9%, just over 2.5M

Work-less households now at a
10 year high (370,000)

Unemployment amongst women
is at a 23 year high

Youth unemployment has also
started to rise again with over
20% unemployed

Now 5.6 people per vacancy
compared to 2.3 in 2008
Recent Trends in Employment

Performance in employment has
been worse than expected, after
beginning to improve from early
2010

Employment fell by 96K in 3
months to July, the rate now
stands at 70.5%

Private sector not absorbing
public sector job losses – 110K
lost in 3 months to June, only
41K created in private sector

Highest level of 'forced' part-time
workers, 1.26 million, since 1992
Recent Trends in Poverty & Incomes

During recession average incomes
increased. However during 2010-11
h/h incomes feel back to 2003-04
levels

Poverty amongst pensioners and
children fell during recession, due
to changes in tax & benefits

Poverty is predicted to increase by
800,000 by 2013-14

Debt remains a critical problem,
more than 9,000 contact CAB for
help every day

Fuel poverty predicted to increase
from 5.5M h/h to 6.4M in 2011
Key elements of UK NRP

UK Government makes very little mention of poverty or
employment for those currently excluded from the labour
market

Economic growth remain the key objective, alongside
reducing the deficit. Emphasis is on competitive taxation
system, need for investment and exports for a 'balanced'
economy, and a more educated workforce.

The focus of the NRP was on five bottlenecks to growth:
reducing the deficit, reform of the financial sector,
rebalancing the economy towards exports, increasing
fixed private investment, improving education to help
human capital formation
The UK NRP: Poverty & Employment

UK Government set no target in relation employment:
rather the objective is to increase 'employment
opportunities for all' through reform of the welfare and
tax system.

Main elements of the employments approach were the
introduction of the Work Programme (system to provide
long term back to work support) and the introduction of
the Universal Credit. Both will significantly increase
conditionality within the system

No target was set for poverty reduction. UK Govt will use
child poverty as the target for poverty reduction. It is not
clear how this fits with the EU level poverty target
UK NRP: The Commission Response

EC identifies various weaknesses in the UK economy:
the unstable housing market, which in part explains high
housing benefit costs.

Also noted that whilst the UK has a very flexible labour
market youth unemployment increased significantly, and
there remains problems with skills and education

The high proportion of children living in work-less
households (17%) was also identified as a key problem

Despite these problems, the EC response make no
reference to the lack of employment or poverty targets in
the NRP
UK NRP: Stakeholder Engagement

UK Govt believes that the NRP was 'subject to extensive
public consultation'. This is a significant exaggeration!
There was no public engagement on the NRP. There
was consultations on various policies within the NRP, but
no discussion on the overall approach

Mechanisms for stakeholder engagement around EU
social inclusion process were scrapped at the beginning
of 2011. The preference is now for 'upstream
engagement'

Civil society engagement with EU processes – the NRP,
EPAP, Social OMC – is a very low ebb. There will need
to be significant rebuilding of capacity to engage
The Impact of the European Semester

It is hard to identity the footprint of the European
semester on economic, social or employment policy in
the UK.

The UK's approach to fiscal consolidation appears to be
driven by UK rather than EU priorities.

The lack of plans for poverty reduction in particular, and
the absence of any Commission comment, appears to
reinforce the fundamentally unbalanced nature of
'Europe 2020'

In the UK's case, it would appear that it [EU2020] is a
process that can sit alongside domestic agenda's without
being influential on the approach that is taken.
Conclusions

There is a need to accept that despite the social
dimension to Europe 2020, in practice it appears to be
dominated by economic growth concerns.

It is questionable how far social NGOs, Trade Unions
and other civil society organisations can use EU2020 to
drive a social agenda.

There is a need to build coalitions at national and EU
level that are able to make demands that reflect the
needs of citizens

We should remain engaged with EU2020 and the
semester, but we should not be dominated by it.
Contact:
Peter Kelly
Director, the Poverty Alliance
[email protected]
www.povertyalliance.org
http://thereisabetterway.org
http://marchforthealternative.org.uk