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March 23rd, 2007 · Posted by Skuds in Politics · 13 Comments · Politics

I keep meaning to write something about redistribution, what with it being such a fundamental plank of left-wing ideology and all that, but never quite get round to it.

I first felt the itch way back at the special council meeting to discuss council housing transfer, but you know how it is? If you don’t do it straight away you think it can be put off and then it just slides.

A week or so ago I saw a comment on the Maidenbower forums which might have really prompted me to write something if this site had not been down at the time, and once it was back again I had lost the urgency.

Today a quote in a newspaper story has prompted me to get this out of my system. The story is on the Argus website and it is about council tax in Sussex.

In it are the usual allegations that high council tax rises around here are the fault of the government settlements and there is a quote from West Sussex’s leader where he says:

This system is propagating classic wealth redistribution from the South East to parts of the North and North East and that is grossly unfair on the people of Sussex

He says that as if redistribution is a bad thing, which from his perspective it may well be, but as far as I can see it is one of the good things this government is doing. But unfair? I thought the whole point of redistribution was that it was trying to counteract inherent unfairness.

Back at that council meeting when the whole business of the government taking proportions of council house sales receipts and rents was discussed, there was one particular comment which really got up my nose. And its a big nose of course.

In essence the comment was that the government was penalising well-run councils in the Tory-Supporting South-East in order to subsidise badly-run councils in the Labour-supporting North. I felt like standing up and shouting that these Northern councils were not in the shit because they are badly-run (although some might be, I don’t know) but because their population is still suffering the effects of the destruction of their industrial base. And a lot of that was the inevitable and deliberate result of Tory economic policy.

Here is a small passage from the book Not Abba:

Wool textiles had been the mainstay of Bradford, but competition from low-cost imports and advances in manmade fibres had led to a major contraction of the industry. In 1964 around 50,000 people were employed in textiles in Bradford; nearly one third of the total working in the town. Ten years later, the number of people employed in the textile trade in the area had nearly halved, the Victorian heyday had long departed, and, in 1974, Bradford, along with many other towns and cities faced an uncertain future.

Just think about that for a moment. In ten years almost 25,000 jobs disappeared in a single industry in a single town, resulting in 25,000 people chasing whatever other jobs there may have been. Doing the sums, that is one sixth of the working population out of work at a stroke, and on top of whatever problems there may have been in other industries. I wonder how many work in the textile industry in Bradford now compared to the 25,000 remaining in 1974?

A lot of that was to do with wider economics and technological changes, but the same thing then happened to the major industries in just about every other Northern town with shipbuilding, steelworking, mining and manufacturing being closed down wholesale. Some of that may have been unavoidable, but a lot of it was deliberate as part of the strategy to move away from an industrial economy to a more service-based one and was famously described by Norman Lamont thus:

Rising unemployment and the recession have been the price that we have had to pay to get inflation down. That price is well worth paying

Don’t you just love the “we” there? When unemployment rose it was not Lamont paying the price but all those erstwhile miners, dockyard workers and car-makers who paid that price, and for who low inflation was only the slightest of consolations.

If a town finds itself with enormous parts of its economy destroyed, and large sections of its population unemployed and virtually unemployable until the call centre sweatshops started moving up there with their high-pressure, low-paying and unsecure jobs, there is little the council can do to fix it: at the very point that the cal on their services is greatest, their tax base and income has been decimated, or worse.

Meanwhile, Sussex and Crawley were benefiting disproportionately from the growth in Gatwick airport until uniform business rates came along.

Right now places like Crawley are among the richest in the country (notwithstanding the pockets of deprivation) while places like County Durham are amongst the poorest, with a lot of that being the result of the Thatcherite policies in the 1980s. In a way we have their money, so I cannot see how redistributing it is at all “unfair”.

Can you imagine if Gatwick airport was closed down and half our town was unemployed at a stroke? Wouldn’t we want and expect some government help to ease the pressure? Given the choice I would much rather not be in a place where government help is the only forseeable prospect and I am happy to be in a position where I have enough that some of it can be taken from me.

So whichever smug Tory it was who made the snide remark about ‘badly-run Northern councils’ should be ashamed to be implying that lage parts of the country have caused their own situation when it was all seen by his own party as a price worth paying.

I do not expect the Tories, or their supporters to ever sympathise with the ideological justifications of redistribution, but I am a little surprised that more of them cannot support the principle for purely self-serving reasons. They are always talking about the crowded South-East and the resulting pressures on housing, leading to ridiculously-valued property and increased demand for development, but what do they think causes all that?

I know for a fact that if I lived in Doncaster or Bradford I would not be earning anything like what I do now. Unlike here where I have taken redundancy twice and then walked into higher-paying jobs, in one case the very next day, I know that being made redundant up there would make it more likely to be a choice between a drastic drop in income or long-term unemployment so I would most likely be on the first train towards London and the Home Counties where I would be more likely to get a job.

That is what many thousands have done, and why we just can’t build enough houses down here to meet the demand. The comment on the Maidenbower forum was somethign about why can’t we do something to make the North more attractive to stop the Northerners all coming down here. Well pardon me, but that is exactly what is happening and the Tories complain about it! How do you do that without some form of redistribution?

You cannot blame people for wanting the best for themselves and their families and if they see that as only existing here then they will come here. You can’t stop economic migration by just wishing it away but by working on tackling the causes of it.

I think my biggest disappointment this year, or the biggest one not connected with West Ham, was hearing Labour members in the council echoing the criticism of the government’s mechanisms for redistribution and perpetuating the impression that we are being systematically robbed for the sake of it.

While I appreciate that some of the details are wrong and need to be addressed, like the famous ‘fourth option’ in local authority housing, we should be stressing our support for the principle while pointing out any quirks which make the burden too much in some circumstances.

When the public are against the whole idea, because they have been stirred up by the Tories to feel they are being robbed, we should not be nodding agreement just to look sympathetic to the voters but should be explaining that the whole concept is not only the right thing to do on moral, humanitarian grounds but is also in our own self-interest in the long run.

What is the point of saving a few quid a year on council tax so that we can enjoy being surrounded by thousands of new houses, built to cope with all those from the North, Scotland or the South-West who we have effectively displaced by keeping all the jobs and prospects within a few miles of the M25?

As you can see, it winds me up, but on the other hand it does remind me why my sympathies have always been with the Labour movement.

Just to make it more topical, lets remember that when Lamont made those callous remarks about how was ruining lives in the North to make it more comfortable in the South was a price worth paying, despite it not costing him or his friends anything, it was Dave Cameron standing behind him, listening and learning…

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13 Comments so far ↓

  • Ash

    “but should be explaining that the whole concept is not only the right thing to do on moral, humanitarian grounds but is also in our own self-interest in the long run.”

    and of course it just happens to help the Labour party in their core areas – but of course we aint doing it for that we are doing it for moral, humanitarian reasons – LOL

  • Skuds

    Well yes, that is a handy coincidence, but you may be falling into a sort of post hoc fallacy there.

    The current vogue seems to be for trying to appeal to a few thousand voters in a few marginal constituencies rather than the taken-for-granted core areas, so I don’t think benefits to traditional areas is a big consideration for either Labour or the Tories when they plan their tactics.

    But thats a whole other topic, and probably the reason why parties like the BNP are picking up support – and possibly a good argument for PR.

  • Ash

    I dont actually disagree with your basic assertion that we should regenerate the other regions of the country – I do have concerns that Labours chosen method, expansion of the public sector, is unsustainable.

    In large swathes of the North, Wales and Scotland 1 in 4 now work for the state – of course you may see this as something moral and humanitarian, I see a large percentage of the population now reliant on Government largesse for their income and therefore another ‘handy coincidence’ of a swelling of potential voters for Labour to ensure that this largesse continues.

    Funny how many ‘handy coincidences’ there are recently dont you think?

  • Danivon

    Well, I agree with you, Skuds, unsurprisingly.

    The problem with your argument, Ash, is that for much of the 1980s and 1990s, the state was being rolled back and private enterprise was supposed to fill the gap. It didn’t seem to work. Funny that.

    So what is the alternative?

    Ash, I think you like to find connections where there are none. It’s like finding ley lines or believing Colin Fry.

  • Ash

    “So what is the alternative?”

    Well Danivon lets put it this way – having large sectors of the population working for the government has never been an economic success in any other country it has been tried, but I admire your optimism.

    Governments do not create wealth, they only spend it. A thriving private sector is needed for continued economic success – not just another million people on the governments payrole.

    As for finding connections where there are none – well these ‘handy coincidences’ are getting a bit too common to be accidental – next you’l be telling me that the Department of Health’s decision to base most of the hospital closures in non-Labour constituencies was another ‘handy coincidence’

  • Jane Skudder

    It looks to me as if the reason more people don’t want to move North is not the lack of jobs (there are a few in Manchester, Leeds and even Bradford you know) but the risk of being discussed as a socio-economic issue by half the South….

  • Danivon

    SO, Ash, all you can do is condemn, rather that come up with alternatives?

    ok. just so I know.

  • Ash

    Sorry Danivon I thought it was perfectly clear – as opposed to your idea of state job creation I would prefer the more sustainable encouragement of private job creation.

    The Labour Force Survey shows that the increase in the number of public sector workers is almost equal to the drop in unemployment under Labour. Which is understandable as we are never going to get any increase in private sector employment when we have Budgets like last weeks where the Chancellor whacks small businesses by putting up their tax rate from 19% to 22%.

  • Danivon

    But, didn’t we have a fair period of encouraging private enterprise before the Labour Government came in?

    By the way, in 1997, the standard rate of Corporation Tax was 33% (now 30% to be 28%), and the reduced rate was 23% (now 19% to be 22%).

    So, it will still be lower in 2008/9 than it was the last time the Tories were in power.

    Perhaps Labour aren’t as anti-business as you assume, Ash?

  • Skuds

    Jane – I’m not saying that there are not jobs up North (and I am well aware that whatever problems there are are also evident in the West and South-West too).

    The thing is that the whole economy has changed from a largely manual, industrial one to a service- and retail-based one which the population can’t adjust to overnight.

    If miners or factory fitters lost their job in their 40s or 50s they are not well-placed to do the new jobs without some training or change of expectations.

    While the current school-leavers are being trained for the newer jobs and will fill them as they leave school I do worry that there is a generation left out completely.

    We also live in a goldfish bowl down here, but the emphasis is on house prices more than anything else.

  • Skuds

    I’m sure I have been in this discussion about private/public sector jobs before, and with the amount of outsourcing and insourcing going on I’m still not sure how the definition is made these days.

    Is a contract cleaner, working for a private company whose only contract is to clean the local hospital working in the private or public sector? Are the railway maintenance workers who TUPE’d to Balfour Beatty classed as public or private?

    I think I would like to see some of the source data before getting carried away as I think it could be one of those statistics which everyone ‘knows’ becasue everyone says it, but is very hard to pin down – like the levels of taxation. Sometimes you need to challenge the received wisdom and check it.

    And of course it all depends on what all these public sector jobs are. If we keep crying out for more poice on the beat, more nurses on the wards, more teachers in schools (and if all those part-time teching assistants now count I think all schools have doubled their headcount since I was a kid), more cleaners picking litter and sweeping streets, and so on that is all going to mean more public sector jobs.

    I would love to see us producing more of what we consume instead of importing it, for environmental as well as economic reasons, and I would like to think that any party would encourage that – although we could help ourselves by buying British of course.

  • Ash

    Danivon, I know you are paid to spout the party line but even you must have noticed that everyone has seen through Brown’s smoke and mirrors act.

    Corporation tax has been falling across the industrialised world – even after this latest cut we will still be in the bottom half of EU member nations – and as most commentators have pointed out since the budget, there is no point cutting corporation tax if you are going to increase other taxes to make up the difference.

    And if Labour is such a friend of business as you assume (or are paid to say) why has the drop in unemployment only been achieved by putting more people on the governments payrole?

  • Danivon

    I feel a fisking coming on…

    >Danivon, I know you are paid to spout the party line

    Umm, wrong in the first clause. I am not paid. Equally, I tend to speak my mind, and I don’t always agree with the Party or it’s leadership (eg: Trident, Council Housing, Tuition Fees,).

    >but even you must have noticed that everyone has seen through Brown’s smoke and mirrors act.

    Eh? Yeah, he’s right conned us hasn’t he? Bring back Lawson & Lamont, the men who cut taxes but also led us into recessions and high interest rates!! Brown has been broadly redistributive and has used growth to fund major increases in public spending. The balance of taxes has shifted from direct to indirect, but that’s because people can’t handle income tax increases.

    >Corporation tax has been falling across the industrialised world – even after this latest cut we will still be in the bottom half of EU member nations.

    Ahh, but what about their overall taxes? I think we are pretty competitive.

    >and as most commentators have pointed out since the budget,

    Source for that assertion?

    >there is no point cutting corporation tax if you are going to increase other taxes to make up the difference.

    Well, if it incentivises profit, there is a point, isn;t there?

    >And if Labour is such a friend of business as you assume

    I assume nothing, I just don’t think that Labour is the enemy of business that you paint it out to be.

    >(or are paid to say)

    Which I am not

    >why has the drop in unemployment only been achieved by putting more people on the governments payrole?

    Hmm. Of course, overall employment has risen faster than unemployment has fallen. While the increase in public sector jobs may (and I await your sources on that one), match the decrease in unemployment, more jobs than that have been created. Perhaps those jobs are in the private sector?

    Of course, you have produced no real figures or sources, so you could be just talking off the cuff.

    Fair enough, but if so, please don’t come all superior.