This essay, on what the coronavirus pandemic has laid bare about policy towards low-paid workers, was my Observer column this week. It was published on 22 March 2020, under the headline ‘Coronavirus exposes society’s fragility. Let’s find solutions that endure once it’s over’.
In a crisis, a society often reveals both its best aspects and its worst. So it is with Covid-19. On the one hand there is the selfishness of hoarding, on the other the selflessness of mutual aid groups. On the one hand, there is Britannia Hotels, which has not just sacked staff but evicted them from their accommodation (a stance it now appears to have reversed under public pressure), on the other the footballer-turned-hotel-owner Gary Neville, who has promised to pay wages to all employees through the pandemic while also providing accommodation free of charge to NHS staff. On the one hand, there are medics and paramedics working heroically with inadequate protective equipment, on the other the Home Office using the ‘health surcharge‘ to extort money from foreign doctors for the right to make use of the same health service they are helping to sustain.
In a crisis, too, issues that policymakers have long ignored suddenly become urgent. The pandemic has laid bare the insecurity of work, the cruelty of welfare policy, the hypocrisy of a system in which every time a crisis hits we are told that ‘we’re all in it together’ but in which, before and after the crisis, the needs of the poorest and most vulnerable are largely ignored.
The economic burden imposed by the policy of social distancing has fallen most upon the poorest and the lowest paid, many of whom cannot work from home and have few savings on which to fall back. In response, the chancellor, Rishi Sunak, unveiled on Friday a major package of measures, including grants to businesses covering up to 80% of employees’ wages, and increases to universal credit and working tax credits.
The measures are significant, necessary and welcome. There are holes in the package, especially for renters and the self-employed. Nevertheless, Sunak was right to call it ‘unprecedented’. But it also raises the question: why does it require a pandemic for the needs of low-paid and insecure workers to be taken seriously?
Certain policies, such as the state subsidy for wages, are specific responses to the current crisis. But what the pandemic has really exposed are the inadequacies of successive governments’ responses to low pay and poverty. And while it might seem like carping to be critical at this time, there are deeper questions that need asking about policy as it has evolved over many years.
With the coming of the pandemic, policymakers have suddenly discovered that those normally consigned to the margins of the labour force as ‘unskilled workers’ are crucially important to the functioning of society. Cleaners, shopkeepers, delivery drivers – these are the people, often migrants or women, on whose invisible labour society depends, but whose efforts are usually treated with contempt. The government’s list of ‘key workers’ is a list largely of jobs in which workers get paid derisory sums for doing vital work. ‘Low-skilled’ has become as much a measure of moral worth as a job description.
The impact of the pandemic has also led people to notice that statutory sick pay is just £94.25 a week. The health secretary, Matt Hancock, admitted on BBC’s Question Time that he could not live on that. ‘But you expect others to live on it,’ Fiona Bruce observed. And even that meagre sum is not available to two million lower-paid workers, those on zero-hour contracts or the self-employed. The problem of inadequate sick pay has existed for years without policymakers taking much notice. Not being able to afford to go sick may particularly be a problem in a pandemic, but it’s a dilemma that has long confronted thousands of self-employed and gig-economy workers.
Nor is the issue just sick pay. As the Resolution Foundation’s Torsten Bell has pointed out, unemployment benefits are worth less in real terms now than they were in the early 1990s. Jobseeker’s Allowance and Employment and Support Allowance for the disabled stand at just £73.10 a week if you’re 25 or over – and £57.90 if you’re under 25. Carers’ allowance, for those who spend at least 35 hours a week looking after someone disabled, is a scandalous £66.15 a week. Politicians and policymakers have long accepted what is effectively state-sanctioned poverty within our benefits system.
Successive governments from the 1980s on have stigmatised claimants and made the welfare system harsh and mean-minded. In parliament last week, Iain Duncan Smith, the architect of the disaster that is universal credit, warned the government against the introduction of any form of Universal Basic Income (UBI), as a ‘disincentive to work’. There are reasonable arguments for and against UBI. But the claim about ‘disincentives to work’ has too often been used as a means to cut benefits to the bare bones, and was, in fact, central to Duncan Smith’s rationale for universal credit, turning what could have been a reasonable reorganisation of the benefit system into a punitive one.
And then there is the issue of private renters. The government has announced a three-month delay in landlords being able to enforce evictions. For those who have lost wages or their jobs, that is merely to defer rather than to eliminate the problem. As with low pay and benefits, the issue is a longstanding one. Many studies have shown the relationship between private renting and poverty, the inability of working families on low wages to rent in many parts of the country, and the fear of eviction and homelessness, even in normal times. The pandemic has not created the predicament, it is simply exacerbating a pre-existing problem.
Coronavirus has exposed the fragility of social life. It has revealed, too, that a large measure of that fragility is the result not of the pandemic, or of the attempt to combat it, but rather has been built into the system through deliberate policy. The worry is that beyond the pandemic, and the temporary measures announced by the chancellor, the issues of poverty and inequality will once more be ignored.
The 2008 financial crisis was resolved with vast amounts of public cash. And then the public was made to pay for that generosity with a decade of austerity. We may need to do ‘whatever it takes’ to bring the pandemic under control. But once it is under control, will we also then do whatever it takes to deal with low pay, insecure work and inadequate benefits?