European poor
Terry Pitt
Poverty Report: 1975 Edited by Michael Young (Maurice Temple Smith £4.00) Academic studies of poverty, though crucially important, are normally the driest of reading. The third part of Michael Young's latest book departs from this norm by including the first ever comparative study of poverty in Britain and the Federal Republic of Germany. If for no other reason than the constant propaganda from pro-Marketeers parading statistics of social security chosen to 'illustrate' the advance of West Germany this study is important.
Poverty is of course relative. The level of income necessary to survive in Camden, Dortmund, Watts and the Gaza Strip vary enormously. But why do most of us still think that Germany is way ahead of Britain? The answer, even for the most immune anti-Marketeer, is our exposure to constant propaganda. Even the facts of recent record unemployment in Germany, and her obvious weakness in energy-deficiency, have made little dent on the image of thriving prosperous work-happy people who should be the envy of us all.
The Poverty Report shades that impression. Whilst making frequent federalist noises ("A combination of Beveridge and Bismark ...", to take the most fatuous) conceeds that in social security "for the poor the British [ system] has the overall advantages" and, conclude the authors, "if we had been writing about the Health Services ... we would have been firmer still in that conclusion". Thus speaks Michael Young, ex-Director of the Institute of Community Studies and currently Chairman of Mrs Shirley Williams's National Consumer Council.
Greater students of social policy will doubtless review this book elsewhere. For myself, the facts are more and more clear expecially when 1 read about Germany. The present transition to corporate-capitalism, with giant companies demanding concessions from Governments even to the point of demanding the surrender of national sovereignty, may have helped the majority but have certainly not helped the poor.
Forget the idea of "workshy", "scroungers" or the "bone-idle"; all social policy studies indicate that there is no statistically valid evidence for such a group. Instead, think of the wider issues in determining how society should help the individual in adversity whether that adversity be old age, ill health, unemployment or handicap. All of these will come to everyone at some stage in their lives, and a good way to judge any society is the way in which it treats such problems. In Germany, mainly because social security is based on private entitlement to benefits, the average person in adversity is better off. But what about the millions who are not so entitled? Few women have a sufficient employment record, either in Britain or the Federal Republic, to build up a personal economic base sufficient to carry them through any major personal crisis. Immigrants in Germany (or "guest-workers" as they are so ineptly called) not only have the problem of being unable to call upon any entitlement to insurance, they are further subject to the ultimate indignity of being denied the vote. That group of Germans who crossed from the East (they are still called "refugees" in spite of the famous Ostpolitik) are also unlikely to be entitled to state-help in adversity. There are therefore a large number of people in West Germany to whom poverty is a real and a great threat. As the Referendum campaign gets under way, one question we must really press home concerns the intentions of the Commission and the Common Market Council of Ministers with regard to the harmonisation of social policy. After all, Mrs Castle has not exactly been conspicuous in Brussels during the so-called re-negotiation period!
Writing as a foremost expert in the field of social policy, and one who has had consistent links with Labour's pro-Market elite, Michael Young says that the EEC "need not become a rich man's club, but it could become a poor man's club if the member countries came to be judged by the humanity and skill they used to help the unfortunate." We should keep in mind that he is here comparing the richest EEC member with one of the poorest. Morever, he is making no comment on the central question of how poverty is to be handled.
Are we once again to give greater power to the Common Market Commission (for I know that that is what they would like), and if so, are we to raise the EEC Budget by the enormous amounts necessary to carry through a "European" social policy? In which case, who is going to pay the impoverished Irish, Italians and British, or a German Government which on this evidence will not deal with problems on its own doorstep?
In the small part of Germany studied here the area of Norstadt in the Ruhr-city of Dortmund the researchers found that as many as one in five households were in poverty. In the field of housing, in spite of a massive German building effort, it was more the people in middle income brackets who had benefited from "social-housing" rather than those at the bottom. Without being too unkind to the authors of The Poverty Report, if any of these' things had occurred in Britain in the last ten years there would have been an immense outbreak of breast-beating from the wellheeled lobbyists and their friends in the media enough to shake the Government.
Poverty in Britain today is serious, and not to be dismissed because for the poorest we compare better than West Germany. In spite of recent substantial increases in pensions, inflation is running fast ahead of the retired person's income. For the employed, the new innovation of threshold payments has only helped give some brief respite. The mechanism of threshold was triggered with disconcerting regularity during 1974, due to runaway price increases, yet the consequent cumulative £4.40 a week increase for the groups of workers involved still fell mainly to the average rather than the lower-paid worker. We must also face the fact of Britain's absurd tax system; inflation of prices means that the poor are heavily hit, inflation of wages means that those on low incomes pay more and more tax.
But my purpose here is to invite readers to see this book in the light of the Common Market argument. Let me first give the authors' own conclusions: Britain has a more comprehensive pensions coverage, better social protection for the low-paid, more equal housing opportunities, and an immensely better administration of the whole system of benefits. Germany has higher pensions for the majority, higher unemployment pay for the majority, a more flexible retirement age, and a better guarantee of help in the early days and weeks of sickness, Perhaps the most important point is that Britain has far more equality for women — in particular the same pension as men.
Like so much else about the EEC, we were previously ignorant of the extent of poverty in Germany. In fact, that country has been paraded as the object of envy in such matters whilst the Market has simultaneously been paraded as the only possible saviour of the poor in Southern Italy. As we prepare for Referendum Day, let us hope that more such evidence of the facts will come into our hands.
Terry Pitt was Head of the Labour Party Research Department 1965-74, and then Special Adviser in the Cabinet Office until November 1974.
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