By Chaminda Jayanetti
Just because something should happen, doesn’t mean it will.
Many articles speculating on how Britain will look different after coronavirus mistake what the writer thinks should happen with what probably will, trusting in the logic of the moment when politics often obeys anything but.
Others focus on the party political fallout, which is the most unpredictable aspect of all. Coronavirus may determine the next election - or it may play no role in it at all.
But to really get an idea of how Britain could look on the other side, we need to get away from the big picture discussion and dig deep into policy areas.
The centrality of the NHS is now guaranteed no matter who is in charge. The Tories had already pledged increased funding, and the need for spare capacity in the event of pandemics may force a rethink of service redesigns and efficiency measures that aimed to minimise ‘waste’.
Bigger questions surround the adult care system. No-one can now ignore the funding cuts and staff shortages that have left the care sector so depleted. If elderly and disabled people find themselves dying untreated in care homes in large numbers, this might - and should - become a point of national shame over the coming weeks.
The Tories’ direction of travel is towards a social insurance system, whereby people pay in to a fund during their working lives that gives them access to care provision when they need it. But those who are retired or have lifelong care needs won’t be able to pay into an insurance scheme before receiving care. These immediate care needs will need direct public funding, not long-term insurance.
Labour under Jeremy Corbyn took a different tack: universal free personal care for the over-65s, with an ambition to extend this to all working age adults. This is simpler and more inclusive than our current means tested mess, but it doesn’t come cheap: Labour’s manifesto estimated the cost as £11bn a year by 2023/24.
Keir Starmer will be under pressure from some to stick with their existing policy, and from others to engage with social insurance proposals. Keeping Labour MPs united behind whatever strategy he adopts won’t be easy.
But it’s plausible the Tories will also be pulled in another direction - towards voluntarism. The party’s social and fiscal conservatives - uneasy bedfellows in recent years - could use the increased community cooperation seen amid the pandemic as evidence that volunteers and family members can take on more of the care burden, while still improving pay and conditions for care staff.
Expect to see rhetoric that the pandemic has 'unleashed’ Britain’s 'community spirit’, which should be 'channelled’ after the crisis by relying on family and neighbours to 'look in’ on people in need - the soft-soap version of women doing unpaid care work in lieu of public services. The current trend in care provision is towards making use of what 'assets’ people already have, including friends and family - an approach that can be used for good or ill. The temptation for the government to lean on unpaid volunteers instead of the taxpayer is not hard to imagine.
The care system was the biggest public service challenge facing the government before coronavirus. Now that’s been magnified tenfold. It could become one of the big battlegrounds of post-pandemic politics, between competing visions of society based on universalism, managed markets, and voluntarism.
Bob Crow was right
Before his death in 2014, Bob Crow was one of the most demonised figures in Britain. His readiness to threaten to shut down rail networks as head of the RMT union made him a bête noire for commuters, causing considerable disruption.
Crow was a rarity in post-Thatcher Britain - a union leader who was ready to use strike action as a sword, not just a shield. Whereas most unions only went on strike in defence of existing jobs, pay and conditions, Crow levered the criticality of the role of his members to transform their economic position.
He was accused of holding passengers and politicians to ransom, but his argument was a simple one: the disruption caused by his members going on strike showed how important their role was, and they should be paid more - much more - to reflect this.
It has taken the worst pandemic in more than a century for many people to realise this point. Pay does not necessarily reflect the importance of a worker’s role - in fact, very often it does nothing of the sort. Pay reflects many factors: supply and demand of labour, required skills and levels of education, the strength or weakness of collective bargaining, the resources of the employer, and the profit-making productivity of the role. The social necessity of the role comes below pretty much all of them.
There may well be a post-pandemic cross-party consensus for a higher minimum wage and more protection from exploitation - action on zero hours contracts, for example - to protect low-paid workers from poverty.
But Crow didn’t want his members to be low paid at all. He wanted to transform their economic station. We keep hearing about essential workers in cleaning, portering, social care and customer service. Will this be rewarded with more middle class pay and conditions?
There are reasons to be doubtful. There will likely be broad acceptance of the importance of care workers, who are a very visible part of the fight against coronavirus. But that does not mean politicians will be ready to fork out for transformative pay rises. Will Starmer accept billions of pounds of extra spending on top of the £11bn Labour has already earmarked for social care, let alone the Tories?
And where is the industrial, political or public pressure going to come from to secure such pay rises for the often migrant workers in portering and cleaning? We don’t want to accept it, but many workers on middle incomes would sneer at the idea of porters and cleaners being paid the same as them.
The safety net
The benefit system has taken a battering over the last decade. Now the economic shutdown is driving more than a million people to seek refuge in the rubble left behind.
The government has responded by performing emergency repairs - raising benefit payments and scrapping job search requirements in a desperate attempt to stop the newly unemployed middle classes struggling in the way the unemployed poor were expected to.
Things could play out from here in a number of ways. If Universal Credit functions to a level the government can live with, they will declare the system a success, leaving Starmer in a politically difficult position. Will he keep Labour’s pledge to axe what will have become an established system, or switch to reforming it, thus angering his left flank. Labour may try and build a minimum income guarantee using the framework of this system. Or they may 'abolish’ Universal Credit by tweaking it and changing its name.
If Universal Credit simply topples over - unable to process claims properly, or pay out the right sums of money - the government might be forced to give up its costly and chaotic flagship scheme.
What then? Labour would push for a more generous system with far fewer conditions and sanctions. The Tories would be truly hamstrung, having in this scenario wasted a decade on a failed system.
Public opinion would not necessarily favour a more generous, less judgemental approach. The declared end of the pandemic, and the gradual return to some kind of economic normality, would likely bring back demands that the unemployed get back to work, and that they be cattle-prodded into doing so. Laid off workers do not carry the same image as health and care workers in this pandemic - and doubtless right wing ideologues will start shouting about the deficit the first chance they get.
But if the economic recovery is insipid, with little job creation, enduring high unemployment, and a stop-start lockdown as the virus returns, both parties could be drawn to more universal systems - a minimum income guarantee set at a liveable level, or even a Universal Basic Income.
The government toyed with introducing UBI last month, but it would face wide opposition from Tory MPs unhappy at its cost. Claire Ainsley, who is expected to be unveiled as Starmer’s policy chief, is also a sceptic. It is expensive, blunt and largely untested. But if jobs don’t reappear as the pandemic passes, the 'on yer bike’ mentality that has underpinned the benefit system for decades will itself be left redundant.
A costly affair
Britain is running up huge deficits as sectors of the economy grind to a halt. How will all this be paid for? Starmer is calling for higher taxes on the rich, but that alone is unlikely to be sufficient, especially if corporate profits remain depressed for years. Everyone is going to have to pay more.
Could the Tories go in for funding cuts? Perhaps - but likely not at the scale we’ve seen. The big targets after 2010 were local government and welfare. The former can’t be cut further without it collapsing. The Tories may winnow away at the latter. Foreign aid could take a hit. But the party would have to tear up its electoral strategy of higher spending on schools, hospitals and police to recreate full-blown Osbornomics.
Labour, and possibly even the Tories, may look to wealth taxes to help bring down the deficit. Taxing people’s wealth would be a major shift in Britain’s approach, and could finally tackle one of the key sources of economic inequality.
But there’s a problem. The richest hold most of their wealth as financial assets, meaning they can easily move it to offshore tax havens. Fixed assets, like houses, tend to benefit the middle classes. Taxing property wealth could hit Tory homeowners while barely affecting hedge fund billionaires. Targeting the latter would require a Tory government to clamp down hard on tax havens.
Conservative MPs are likely to be split on middle class tax rises and spending cuts. If the Tories go after tax havens and impose a progressive wealth tax, it would be one of the most dramatic changes the pandemic brings about. The curtailment of the free movement of capital would be a paradigm-shifting development, and an extraordinary one for a Conservative government.
What does need to happen is for governments to spend on preventative services - such as social care - in the knowledge that this will cut required spending down the line. Only when that happens will Britain’s fiscal politics finally grow up.
But on a variety of fronts, the British are going to have to decide what it is we are willing to pay for. If we want functioning public services and low deficits, we’ll have to pay more tax. If we want properly paid frontline public servants, we’ll have to pay more tax still. If we want to end poverty pay, we may have to pay more for goods. If we want to protect the high street, or British producers, we may have to pay more in digital sales taxes or import tariffs.
Cakeism has run out of road.
The known unknowns
If Britain does head down the path of higher taxes, more generous benefits and greater public provision, our politics and economy will start to look more European - either universalist northern European, or rather more patriarchal southern European.
But the irony is, we’ll be firmly outside Europe. Nothing that is happening right now will be fostering a European identity among voters. And if the government decides to take radical action on the economy, that could mean Britain fundamentally diverges from EU rules, keeping us on a separate path into the future.
All this is predicated on coronavirus being conclusively 'defeated’, and a one-off in its mortality, geographical spread and disruption. Those are the prerequisites for things eventually returning to some recognisable norm.
If, however, pandemics of this scale become even semi-regular, shutting down national economies for months at a time, everything changes. Rents become unpayable, debts unaffordable, jobs untenable, the economy itself unsustainable. When Rupert Harrison, George Osborne’s former adviser, is openly suggesting debt forgiveness, we are in very new territory.
Most people will want life to get back to normal as soon as possible. But if normal never comes, anything goes. And even the most radical ideas we’ve discussed would be on the moderate end of what could happen then.