Top of the Charts: Burning injustices special edition

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Morning all,

Never mind a week, two minutes is a long time in politics these days. And two years is an eternity, so for Theresa May simply to have reached her second anniversary of taking up residence in Downing Street today is something of a triumph.

Her speech on the steps of Downing Street the day she took office hardly mentioned Brexit, instead committing her government to fighting the “burning injustices” that scar our nation. It was powerful stuff, correctly identifying many of the elements of a domestic reform agenda that our country needs.

Now, as this week proved yet again, Theresa May’s premiership will only ever be about Brexit. But Britain isn’t, so it is worth asking what is the status of the injustices identified by the PM two years ago – have they been left to grow while the Brexit debates rage, or has progress been made under the radar? So this week, rather than our normal reading material, we’ve pulled together a progress report on some of the burning injustices the Prime Minister talked about, with links to more reading if that’s your thing.

It’s a bit longer than usual because we thought more reading was a particularly valuable distraction from turning on the TV and seeing a buffoon with a comb over letting not just himself but the whole class (western democracy) down. I hope it’s of interest.

Torsten

Director, Resolution Foundation

 

  1. Health inequalities: “We live in a country where if you’re born poor, you will die on average 9 years earlier than others.”

This is about as burning as an injustice gets: if you live in a poor area you can expect to die a lot earlier. In England the gap between the richest and poorest areas is over 7 years for women and 9 for men. This gap may have narrowed in the 2000s, but more recently the gap has been growing again.

But the really bad news that has emerged on Theresa May’s watch is less about health inequality and more just about health: mortality rates have stopped falling to a significant extent since 2011, meaning life expectancies are not rising as quickly as we used to think. They are of course still improving, just more slowly, and the government has announced £20 billion extra NHS spending, so it’s not all doom and gloom…

 

  1. Race discrimination: “If you’re black, you’re treated more harshly by the criminal justice system than if you’re white.”

Shining a light on the issue of racial disadvantage has been a welcome priority from this government, initially with the criminal justice focused Lammy Review (which found that BAME men and women make up 25 per cent of prisoners despite making up just 14 per cent of the population) and then more broadly by establishing the Race Disparity Unit. Concrete action in response to that transparency is harder to identify…

A major Resolution Foundation report next week will show that the labour market remains a big ongoing source of disadvantage. Yes, the ethnicity pay penalty has shrunk markedly for most ethnic groups over the last 20 years (most of all for Indian workers) but it is still too big and for black women and men it has actually worsened.

  1. Social mobility: “If you’re a white, working-class boy, you’re less likely than anybody else in Britain to go to university. If you’re at a state school, you’re less likely to reach the top professions than if you’re educated privately.”

Social mobility is a big topic – but everyone focuses far too narrowly on university access or becoming a lawyer. Don’t get me wrong, those are important, but there’s more to social mobility than getting into Oxbridge.

On universities the big move the government has made is to raise the income threshold for student loan repayments from £21,000 to £25,000. This is obviously good news for graduates and means that the bottom 40 per cent of graduate earners are now better off than they would have been under the system before £9,000 fees were introduced in 2012. But before we start handing out social mobility brownie points…remember those white working class boys that aren’t going to university? They will end up paying higher taxes for this huge £2.3 billion a year giveaway to graduates. I’d call this a public policy turkey.

More positively, the government has rightly focused on the flipside of this burning injustice – poor routes from school and into work for those not taking the traditional A-levels to university path. Rolling out the Apprenticeship Levy and T-levels has the potential to transform vocational education in Britain. There will inevitably be challenges for reforms on this scale but we all need them to succeed – that means the government giving them more political focus and, for the too-often ignored FE sector, more cash.

There is also something unambiguously good that Theresa May has done for social mobility: scrapping her plans for lots of new grammar schools. They are after all a social mobility disaster.

  1. The gender pay gap: “If you’re a woman, you’re likely to be paid less than a man.”

Here I think we can give Theresa May maximum points for a significant success. The requirement that all big firms report their gender pay gap this year drove a huge media focus. Yes much of that was about gender gaps amongst the very highest paid, notably at the BBC, but it does feel like it’s marked something of a watershed more generally and could drive real cultural change. Here’s hoping.

We also shouldn’t forget that this is about women doing way more than their share of low-paid work, not just who earns hundreds of thousands at the BBC. On the silver lining side, that existing unfairness does mean that women are by far the biggest beneficiaries of the government’s big increases in the National Living Wage.

  1. Home ownership: “If you’re young, you’ll find it harder than ever before to own your own home.”

Everyone’s only really started panicking about home ownership in the last few years, but for young families it actually peaked when the Berlin Wall was coming down in 1989 and has been falling ever since. And no this isn’t just about London… As a result, today’s millennial generation are half as likely to own their own home by the age of 30 as their parents’ generation at the same age.

The government has made some welcome, if tentative, steps on housebuilding. But low interest rates and weak incomes for the young mean they simply won’t see a return to high ownership rates anytime soon. That’s why the most important thing the government has done is to at last get serious about improving things for those renting in the private sector (where we’ve seen a tripling of the number of families bringing up kids in just the last 15 years). Consulting on moving towards longer, three-year, tenancies is a very welcome step indeed. It also shows how fast the ground is moving politically on housing – you might remember three year tenancies were considered Venezuelan a few years back…

  1. Insecure work: “If you’re from an ordinary working class family, life is much harder than many people in Westminster realise. You have a job but you don’t always have job security.”

Insecure work – from self-employment to zero hours contracts and agency work – has boomed over the last decade. The good news is it looks like we may have reached ‘peak insecurity’. But the level of insecure work is still far too high. One in seven of our workforce is now self-employed and outside the protection of much employment law, while nearly a million workers are on zero hour contracts.

To their credit the government commissioned the Taylor Review to examine these issues – a welcome change from the days when the Conservative Party opposed the introduction of the minimum wage. It had some good ideas on protecting agency workers and higher pay for non-guaranteed hours, and some disappointing ones (including ducking the issue on zero hour contracts). The question now is what actually happens. There is growing frustration that the government is dragging its feet on implementing a review that reported a year ago this week. It’s good to be an optimist so, while it won’t be enough, I’d be surprised if nothing happens… Time will tell.

  1. Cost of living: “You can just about manage but you worry about the cost of living…”

The Prime Minister got the gig because her predecessors decided that losing a referendum wasn’t a good look. But that same referendum means that on this burning injustice, far from getting better, things have got significantly worse.

The fall in the pound after the referendum pushed up inflation to over 3 per cent last Autumn, meaning that prices were rising faster than pay packets last year. Real wages have only recently started growing again. High inflation also increased the impact of the welfare cuts Theresa May inherited from George Osborne – freezing benefits for four years hurts a lot more when prices are rising fast.

On the positive side employment has continued to outperform expectations over the last two years. But with further benefit cuts due, and prospects for real pay growth weak, the living standards outlook for the ‘just about managing’ families Theresa May cares about is not looking too rosy.

Conclusion

So where does that leave us? Big picture-wise, the bad news two years on is that the injustices Theresa May rightly highlighted are generally burning just as brightly. And in the case of living standards the challenges are if anything bigger.

But that doesn’t mean nothing has happened. On disadvantages of ethnicity and gender, shining a light is of real value. In the case of the gender pay gap it has started something of a movement beyond government for real change. On more security for renters, along with more security for some workers, the right noises are being made – but they need to be turned into actions.

Why has progress been slow? Brexit of course, which is inevitably all consuming for this government. But it’s also because these problems are big and doing something about them requires willing the difficult means, not just wishing the badly needed ends. It’ll take more than 24 months to tackle issues this big.

Two years on the underlying truth is that Theresa May will always be remembered for Brexit, but the burning injustices she has highlighted will be with us for some years to come.