The issue of poverty is high on the current political agenda. It is linked to diminishing living standards, as council funding constraints result in public service cuts. These austerity policies coincide with a rise in the basic cost of living. Decades of underinvestment in infrastructure, and a reliance on the private sector to forgo profits to invest in society’s future, have resulted in the UK Government having prices dictated by market forces.
A secondary effect of the diminishing living standards of the electorate is a rise in support for ‘far-right’ parties. The First Minister, John Swinney, has called for a convention of those on the political centre and left for talks on strategies for working together to counteract this surge. The talks, if they are held, will revolve around the topic of poverty and its consequences.
Poverty today
Defining poverty is a tricky business, as this House of Commons library publication illustrates. Poverty in the UK is not the lack of the essentials of life, suffered by previous generations. It is a relative figure measured from the earned income of the entire population, and extrapolated statistical markers based on disposable income.
A financial measurement provides very little useful information on the areas where government spending could be targeted to achieve the ‘biggest bang for the buck’. The lack of specifics, and a centralisation of decision-making power, ensure that any report on an issue such as poverty becomes a box-ticking exercise, with little hope of findings being translated into functional change or improved outcomes.
These issues are best addressed at the most local level possible. Funding can be targeted to meet the real needs of those suffering most. Too often, this help is in the form of emotional support: an attempt to help the individual deal, mentally, with the situation they find themselves in, and discern a path forward through the fog of a system constructed to be obscure.
Instead of creating real jobs and training people to meet their own essential demands, current policy aims to help those in need to write better CVs, or present a better version of themselves at a job interview. By being thrown back into the same finite pool of opportunity, even if the training is successful (and they don’t end up washed up at the side again), the result is simply that someone else is displaced and then in need of assistance.
The natural rate of unemployment
Poverty is often associated with unemployment. In the UK there has been a long-standing lack of sympathy for the involuntarily unemployed. There is a fallacy that funds from hard-earned taxes pay for welfare benefits. This leads to contempt from working people for the unemployed, who tabloids label as ‘lazy beggars’. This shows a complete failure to understand the causes leading to someone finding themselves willing to work, but unable to find a job.
Mainstream economists in the UK define the British pound (GBP/£) as simply a unit of exchange. This narrows their focus on what policy space is available to the national government. With a wider, heterodox view of the UK economy, the currency becomes the tool that, when wielded skillfully by the government, allows society to be provisioned to an optimal level.
Much of the art of the government as currency-issuer has been lost in recent decades. One example of this is the knowledge that the government has the ability to employ all idle resources, including labour. UK citizens should always be able to find work paying in GBP/£.
Instead, mainstream economic thought in the UK believes, as this paper from the House of Commons library lays out, that there is a natural rate of unemployment. Though the figure appears very low (3-5%), and the paper seems to find this ‘natural’ rate acceptable, in reality, over the UK working population, this figure is in the millions.
The defence for this position is the worry that true full employment could cause a wage-price spiral and inflation – one of the main criteria the Bank of England uses to manage the economy – to increase. This concern is another result of the narrow mainstream economic focus. The UK Government can spend money to employ any idle resource without causing inflation.
Even were there to be an uptick in the inflation figure, strategies could be put in place very easily to eradicate the effect in short measure. Heterodox economists have been beating this drum loudly since the financial crash of 2008-09, but little has changed in the narrative told by those in charge of the UK economy.
Discarded resources
It is not only the unemployed who suffer needlessly through these policy decisions. There are millions of underemployed citizens in the UK, working in the gig economy or in several part-time jobs due to the unavailability of secure full-time employment. Many graduates, having qualified in high-value disciplines, cannot find careers matching their academic attainment in their local area. Consequently, unwilling or unable to move away, they accept positions in inferior roles, resulting in not only a lack of personal fulfilment, but a loss of their skill and intellect to society.
Then there are the long-term sick and people with disabilities. There are children who have come through the care system, in need of support to transition to life in society with a meaningful role to play in the community. There are ex-offenders, who, on leaving the penal system, find it difficult to gain a foothold to allow them to find a place in society. Many ex-service personnel find it hard to reintegrate into civilian life, and cannot find an employment ‘fit’.
Examples like these indicate how society is badly served by the current system in the UK. Individuals, dehumanised to a statistic on a government report, are variously syphoned off into third sector organisations to be ‘fixed’, and represented at some future date as rejuvenated citizens. There is no escape to be found in what is an endless, futile search for value in a system of employment geared to exclude them.
Hope is at a local level
The basic religious tenets that are foundational to both English and Scots law stress the divine nature of each human being. In the current economic system, a cohort of the population are treated differently to the rest. This is government policy, and by denying these people the ability to work, the policy makers are negatively affecting them reaching future potential. Yet these people are valuable resources for any society.
What the UK system has discarded, our underinvested local councils should embrace. The untapped potential in millions of our neighbours and associates is a powerful weapon for change. Through utilising the autonomous ability for councils to act on areas such as planning, further education, and the public land available, we can offer employment to anyone at the local level.
This employment would be a life independent of the wider UK system. By educating discarded individuals in food production, house construction, energy creation and distribution, etc, an entire internal economy can be built to higher living standards than are currently available at UK level.
Improved health and wellbeing will benefit the employees of such a system, while the local council benefits from less pressure on the services it currently provides. By increasing the in-house maintenance and supply side, council procurement costs will decrease in direct proportion to the increased development of this internal economy.
Whether the reader wishes to see an independent Scotland or a strategy for revolutionising the UK, this seems to be a scalable micro-system to experiment with. The first step is to take control of the local councils through independent councillors. I propose that for real UK change, or for the hope of an independent Scotland, the 2027 council elections are far more important than the Holyrood elections of 2026. Holyrood is about securing the status quo. Local councils, controlled by local people without party-allegiance corruption, are the engine of change.
More in politics.
