Thursday, August 21, 2008

Georgie Osborne and the Factoids of Fairness

George Osborne has released a Tory dossier called An Unfair Britain. This explains in detail how unfair it is that Labour won the last three elections, how unfair it is that while they’re in government they get to implement policies and stuff, how unfair it is that even now they’re still in government, and how unfair it is that Osborne can’t get his facts straight or his sums to add up properly.

I paraphrase slightly. Officially, this “compelling dossier… shows that across the board, Labour's policies have made Britain more unfair”.

So let’s see, shall we? The dossier offers a torrent of statistics and factoids; here are some:

New Conservative Party analysis reveals over two million of the poorest pensioners will lose nearly £100 this year as the rise in Pension Credit is wiped out by inflation.

Well done Conservative Party analysers! Heating and food prices have shot up. But this has happened the world over; it isn’t an unfair Labour policy. Does Osborne want more money spent on pensioners? At the same time as he wants taxes to be lower and borrowing to also be lower? The laws of mathematics might have something to say about that. How unfair.

There are 2.5 million pensioners living in poverty (living below 60% of median income measured before housing costs…) which is 100,000 more pensioners than in 1997.

They’ve been wrong about this before. In reality, the number of pensioners below the poverty line so defined is either unchanged or 100,000 lower depending on whether they mean 1996/97 or 1997/98 when they say “1997”.Worse still, this is the number of pensioners below the poverty line. And there are now many more pensioners than there were back then, which means that the proportion of pensioners below this line is significantly down.

Labour’s increased use of complex means testing of pensioners has resulted in reduced take-up of benefits. … Between 1.2 and 1.8 million pensioners failed to take up their entitlement to Pension Credit last year.

But no figures are given for how many pensioners failed to take up Pension Credit before Labour introduced it.

Gordon Brown’s reckless borrowing – on and off the balance sheet – has simply shifted the burden of paying for today’s public expenditure on to the next generation.

Except that, as Snowflake explains, national debt as a share of GDP is now substantially lower than in 1997.

The gap in life expectancy in Britain between rich and poor is now at its widest since the Victorian era.

The BMJ paper that the dossier cites gives no figures for the Victorian era, but it does give life expectancy figures for more recent periods.

During 1995-97, life expectancy at birth for the richest tenth was 4 years longer than that for the poorest tenth. During 2001-03 (the most recent figures), this difference was 4.1 years. Between the two periods life expectancy for the richest rose by 1.5 years; for the poorest, it rose by 1.4 years: apparently a tiny increase in inequality.

But, as John Rentoul notes, those figures were disputed in a later issue of the BMJ, where it was pointed out that the margin of error in the numbers is plus or minus one year. A 0.1 year rise in the gap therefore seems meaningless – life expectancy has risen under Labour, for rich and for poor, by pretty much the same amount.

The gap in infant mortality rates between the poorest social groups and the population as a whole has increased since Labour came to power.

This one is technically true but less than horrific when you look at the detail. Since 1997, there’s been a small rise in the child mortality rate gap between the ‘routine and manual’ socioeconomic group and the population as a whole. However, and again, actual child mortality rates have improved for every socioeconomic group, including the poorest. More to the point, the overall rise in the gap since 1997 consists of an increase up to 2002, followed by a (slightly smaller) decrease since then.

There are 900,000 more people living in severe poverty than there were in 1997.

“Severe poverty” is a concept the Tories have fortuitously discovered, defining it as below 40% of median income. It’s a complete coincidence that they like to focus on this measure, because it makes Labour’s record look worse than if you looked at the improvements at the 50%, 60% or 70% thresholds.

The reference they give for their 900,000 figure is an “IFS calculation”, which is pretty sneaky. I can’t find where that number comes from, but figures 4.1a and b here show that the proportion of people (remember, the population has grown) in “severe poverty” more than doubled in the late 1980s and has pretty much flatlined since then – it is slightly up on ten years ago.

But, and this is why I say the IFS citation is sneaky, the IFS don’t think this 40% threshold is a good measure of poverty. They note that the surveys used to supply the income data are a snapshot, so “amongst those people recorded as having very low incomes there will be some individuals who would not generally be considered poor but who do genuinely have few sources of income in the short run. For example, there are a disproportionate number of individuals who are selfemployed at the very bottom of the income distribution, whose incomes tend to be erratic”.

In support of this, it turns out that “the level of material deprivation [covering things that households can afford to buy] for those with incomes below 40% of the median is lower than it is for those with incomes between 40% and 60% of median income”. They conclude that “‘severe’ poverty is probably the wrong term to attach to those with incomes below 40% of the contemporary median”.

Research by the Sutton Trust on social mobility has shown that a poor child born in Britain in 1970 is less likely to escape its upbringing than a poor child born in 1958

True. But what does it mean? The researchers also found that educational achievement, labour market participation in early adulthood, and psychological traits at school age could explain most of the fall in social mobility. The greatest determinants of life chances happen in the early years of life, and those born in 1970 were 27 when Labour came to power.


There are many more numbers and factoids, and I certainly accept that some of them hit the mark. But here’s the thing: given the vast array of different statistics that bear on inequality or ‘fairness’, it’s no surprise that the Central Office internet pixies can find several that show things getting worse – particularly if, as the dossier does, you pick whichever date comparisons make things look worst (now vs one, two, five, ten years ago – there’s no consistency, and many of the claims don’t have a past comparison at all). It would be staggering if any government could produce improvements everywhere you looked.

By contrast, under the Tories in the 1980s there was a spectacular worsening of inequality on pretty much any measure you care to look at. Thatcher’s so-called ‘fixing’ of the ‘broken economy’ involved ripping up the fabric of society. Next to this, Labour’s flawed record has been brilliant.

On other thing: Osborne quotes Gordon Brown as saying that “only the state can guarantee fairness”. The Tories have been trying to pin this quote on Brown for over two years, but to the best of my knowledge (and the best of my Googling), he’s never said it (if anyone knows better, do tell).

I think it’s a deliberate misrepresentation, being used to paint Brown as a clunking top-down statist who thinks that everything should be done by central government, and that all anti-poverty policies have to involve throwing benefit money at people. Not so. On guaranteeing fairness, what Brown has actually said is:

Our voluntary organisations should neither be captured by the state nor used as a cut price alternative to necessary public provision…
Charities can and do achieve great transformative changes, but no matter how benevolent, they cannot, ultimately, guarantee fairness to all. Markets can and do generate great wealth, but no matter how dynamic, they cannot guarantee fairness to all. Individuals can be and are very generous but by its nature personal giving is sporadic and often conditional.
So fairness can be advanced by but cannot, in the end, be guaranteed by charities, however benevolent, by markets, however dynamic, or by individuals, however well meaning, but guaranteed only by enabling government.

5 comments:

Labour Matters said...

Another insightful article Freemania. If you keep writing things like this you'll be getting a reputation. A good reputation!

Tom P said...

Hi Tom

One further point on Pension Credit. I think quite a few of the people who don't claim it are only entitled to trivial amounts, so it might be a reasonable trade-off between the amount of money available and the hassle of claiming.

It's still not a great system, but the headline stats are a bit misleading.

Cassilis said...

Mmm... may have more to say later but on that last point:

"Osborne quotes Gordon Brown as saying that “only the state can guarantee fairness”. The Tories have been trying to pin this quote on Brown for over two years, but to the best of my knowledge he’s never said it"

..and then what he did say..

Charities can and do achieve great transformative changes, but no matter how benevolent, they cannot, ultimately, guarantee fairness to all. Markets can and do generate great wealth, but no matter how dynamic, they cannot guarantee fairness to all. Individuals can be and are very generous but by its nature personal giving is sporadic and often conditional.
So fairness can be advanced by but cannot, in the end, be guaranteed by charities, however benevolent, by markets, however dynamic, or by individuals, however well meaning, but guaranteed only by enabling government"

Genuine question rather than sneery blogger question Tom - isn't that exactly what he's saying? Paraphrased of course but a reasonably fair one by my reading - look at the bits in bold...

Tom Freeman said...

AAARGH! I hate it when you write a long comment and then accidentally delete it. Take two:

Liam, the 'paraphrase' involves gutting the quote of all qualification (enabling government rather than govt that insists on doing everything itself) as well as the acknowledgement of the vital roles of the voluntary and private sectors.

What I take issue with is not so much that they quote him as saying "only the state can guarantee fairness" rather than "fairness can be... guaranteed only by... government", but that they use the 'quote' to paint him as a one-club statist.

For example:

DAVID CAMERON:...a big part of the answer, is actually trusting social enterprises and voluntary bodies, that actually can do fantastic work in dealing with the problems of homelessness and drug abuse.
ANDREW MARR: Gordon Brown says the same...
DAVID CAMERON: No he doesn't. ...if you look at his speech the other day he said very clearly only the state can guarantee fairness. But I have a different approach, I think actually there's a huge role for the voluntary sector and the social enterprises to play.
And I think that actually the belief that the state has to be almighty which we've seen over the last few years, is failing.


Real straw man stuff.

Cassilis said...

We'll agree to differ.

I accept that they're making the most of the quote but hey, they're politicians trying to score points - all parties do it. For all his qualification Brown is unequivocally saying that fairness can be "guaranteed only" by government (the 'enabling' prefix is meaningless in this context) and that's sufficient for me to part company with him politically.