The PM’s been fibbing and the Coalition’s labour market policies are ruled by prejudice

Forget the evidence, ministers know the answer that will buy them votes

Share

Today is the day to stand up for the truth. I watched David Cameron at Prime Minister’s Questions last week tell big fat pork pies. He claimed, at least twice, that employment in the UK was now 1 million higher than it was compared to when the Coalition was formed. A nice soundbite, but sadly totally untrue.

The number of jobs created since the Coalition was formed is well below a million, so he needs to apologise for misleading the House of Commons. The table contains the official Office for National Statistics data, in thousands. Readers of this column will be familiar with how the official statistics are calculated as an average of the single month data. The latest estimate of 29,869 is the average of the three monthly numbers for June to August, which should then be compared with the equivalent numbers from April to June 2010 (given the Coalition was formed in May 2010).

So based on the three-month averages, employment was up by 891,000, not a million. The most recent estimate is to compare May 2010 with the latest data we have for August 2013, which implies an increase of 642,000. This is how every other advanced country – other than Latvia and Greece – counts employment growth, based on single month survey evidence. Again, well below Mr Cameron’s entirely false claim of 1 million jobs created.

In a Tweet to me, Tory Party Chairman Grant Schapps claimed that there was a million job increase from February to April 2010 even though these data relate to March 2010, well before the coalition took office in May.  So he wants to take credit for the 133,000 jobs created under Labour between March and May 2010.

Note too that the single month data suggests that employment is falling steadily. Moreover we have also seen a rise over the last three months in the unemployment rate from 7.4 per cent in June to 7.7 per cent in July and 8 per cent in the latest August 2013 survey. Plus wage growth continues to decline to 0.4 per cent on the month and has even became negative in the public sector: -1.6 per cent, which means rapidly falling real living standards.

There were a couple of papers published last week that also cast further doubt on Coalition spin and its non-evidence based policymaking around the labour market: forget the evidence, we know the answer that will buy us votes and appeal to people’s worst prejudices. It’s all the fault of scroungers and foreigners claiming our benefits. Except it isn’t.

The first was a paper from Rebecca Tunstall* casting doubt on the claims made by the Department for Work and Pensions (DWP) on the likely revenues from the bedroom tax. The tax reduces housing benefit paid to tenants deemed to be under-occupying their homes, with the main aim of reducing UK housing benefit expenditure. It is also intended to increase mobility among social tenants, to reduce under-occupation and overcrowding and to help house people on waiting lists.

A DWP model based on assumptions predicted savings of £480m in 2013/14; however, Professor Tunstall used real data obtained from four housing organisations, which does not appear to match key the assumptions about claimant behaviour underlying the DWP’s model. Of particular relevance is that she was able to obtain details of DWP’s model from a Freedom of Information request. She found, using real world data alongside regional variations in impact, the total savings the DWP’s model predicts is reduced by a third, or by £160m. Typically, rather than engage in a serious debate over the sensitivity of their estimates and the appropriateness of Professor Tunstall’s estimates and methods, the Coalition sent out an inexperienced DWP junior minister to shoot the messenger. Esther McVey in a car-crash interview on Radio 4’s The World at One dismissed the report as not credible, even though she could not identify a single thing of substance wrong with it. Oops.

Then there was a very important new report on the numbers of housing benefit seekers from the European Union** that suggested the Coalition’s claims of hundreds of thousands of benefit seekers from the EU are entirely unfounded.

The main finding of the study was that employment is the key driver for intra-EU migration flows and had little or nothing to do with seeking out benefits. Income differentials alongside employment opportunities were found to be the main drivers of intra-EU mobility: “The possibility of earning more money is currently the main reason EU unemployed citizens consider when moving to certain countries.” The study found little evidence to suggest that the main motivation of EU citizens to migrate and reside in a different member state is benefit-related as opposed to work or family-related.  This was also borne out by evidence gathered for the UK case study prepared for the report. Work was the main reason for migrants coming from other EU countries to move to the UK between 2002 and 2011.

The study found that non-active EU migrants represent a very small share of the total population in each member state. They account for between 0.7 per cent and 1 per cent of the overall EU population. On average EU migrants are more likely to be in employment than nationals living in the same country. This gap can be partly explained by differences in the age composition between EU migrants and nationals, with more migrants than nationals falling in the 15 to 64 age bracket.

The authors also found that the expenditures associated with healthcare provided to non-active EU migrants are very small relative to the size of total health spending in, or the size of the economy of, the host countries. Estimated median values of the costs are 0.2 per cent of the total health spending and 0.01 per cent of GDP. Of course these include pensioners, the children and spouses of EU-migrants. The Home Office response followed the regular pattern of denial and obfuscation – “We consider that these questions place too much emphasis on quantitative evidence.”

So prejudice rules OK? It’s hard for me to take seriously anything the Coalition has to say about the labour market.

*Rebecca Tunstall, “Testing DWP’s assessment of the impact of the social rented sector size criterion on housing benefit costs and other factors”, Centre for Housing Policy, University of York, October 2013

** Analysis of member states’ social security systems of the entitlements of non-active intra-EU migrants report, submitted by ICF GHK in association with Milieu Ltd, October 2013

React Now

  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
iJobs Job Widget
iJobs General

Recruitment Genius: Digital Printer

£21000 - £22000 per annum: Recruitment Genius: A specialist retail and brand c...

Recruitment Genius: Digital Designer

£25000 - £35000 per annum: Recruitment Genius: This digital production agency ...

Recruitment Genius: Class 2 HGV Driver - with CPC

£26000 per annum: Recruitment Genius: Haulage company based on the Thorpe Indu...

Recruitment Genius: Electronics Test Engineer

£25000 - £27000 per annum: Recruitment Genius: An SME based in East Cheshire, ...

Day In a Page

Read Next
 

Election catch-up: Just what the election needs – another superficially popular but foolish policy

John Rentoul
A Gold Ferrari sits outside Chanel on Sloane Street  

Sunday Times Rich List: We are no longer in thrall to the super rich

Terence Blacker
Not even the 'putrid throat' could stop the Ross Poldark swoon-fest'

Not even the 'putrid throat' could stop the Ross Poldark swoon-fest'

How a costume drama became a Sunday night staple
Miliband promises no stamp duty for first-time buyers as he pushes Tories on housing

Miliband promises no stamp duty for first-time buyers

Labour leader pushes Tories on housing
Aviation history is littered with grand failures - from the the Bristol Brabazon to Concorde - but what went wrong with the SuperJumbo?

Aviation history is littered with grand failures

But what went wrong with the SuperJumbo?
Fear of Putin, Islamists and immigration is giving rise to a new generation of Soviet-style 'iron curtains' right across Europe

Fortress Europe?

Fear of Putin, Islamists and immigration is giving rise to a new generation of 'iron curtains'
Never mind what you're wearing, it's what you're reclining on

Never mind what you're wearing

It's what you're reclining on that matters
General Election 2015: Chuka Umunna on the benefits of immigration, humility – and his leader Ed Miliband

Chuka Umunna: A virus of racism runs through Ukip

The shadow business secretary on the benefits of immigration, humility – and his leader Ed Miliband
Yemen crisis: This exotic war will soon become Europe's problem

Yemen's exotic war will soon affect Europe

Terrorism and boatloads of desperate migrants will be the outcome of the Saudi air campaign, says Patrick Cockburn
Marginal Streets project aims to document voters in the run-up to the General Election

Marginal Streets project documents voters

Independent photographers Joseph Fox and Orlando Gili are uploading two portraits of constituents to their website for each day of the campaign
Game of Thrones: Visit the real-life kingdom of Westeros to see where violent history ends and telly tourism begins

The real-life kingdom of Westeros

Is there something a little uncomfortable about Game of Thrones shooting in Northern Ireland?
How to survive a social-media mauling, by the tough women of Twitter

How to survive a Twitter mauling

Mary Beard, Caroline Criado-Perez, Louise Mensch, Bunny La Roche and Courtney Barrasford reveal how to trounce the trolls
Gallipoli centenary: At dawn, the young remember the young who perished in one of the First World War's bloodiest battles

At dawn, the young remember the young

A century ago, soldiers of the Empire – many no more than boys – spilt on to Gallipoli’s beaches. On this 100th Anzac Day, there are personal, poetic tributes to their sacrifice
Dissent is slowly building against the billions spent on presidential campaigns – even among politicians themselves

Follow the money as never before

Dissent is slowly building against the billions spent on presidential campaigns – even among politicians themselves, reports Rupert Cornwell
Samuel West interview: The actor and director on austerity, unionisation, and not mentioning his famous parents

Samuel West interview

The actor and director on austerity, unionisation, and not mentioning his famous parents
General Election 2015: Imagine if the leading political parties were fashion labels

Imagine if the leading political parties were fashion labels

Fashion editor, Alexander Fury, on what the leaders' appearances tell us about them
Phumzile Mlambo-Ngcuka: Home can be the unsafest place for women

Phumzile Mlambo-Ngcuka: Home can be the unsafest place for women

The architect of the HeForShe movement and head of UN Women on the world's failure to combat domestic violence