Below is the text of the Third Annual Poverty Lecture, hosted by Joseph Rowntree Foundation / Prospect Magazine, given by Ruth Davidson MSP on 8 February 2016
I’d like to thank the Joseph Rowntree Foundation and Prospect magazine for inviting me. I am in the middle of a Holyrood election campaign and, to be frank, there aren’t many votes in London right now – but this was an invitation I couldn’t turn down, given the subject matter.
You’ll be glad to hear that this is a short speech where I just want to set out my thoughts, as a centre-right politician, on how we best tackle poverty – and set out some of the ideas I’m going to take into the Scottish Parliament elections over the coming weeks which would help that into action.
Let me begin this evening by rehearsing the old-fashioned right wing stereotype about how to solve poverty.
I’m sure you’re familiar with it.
We start with the argument that all individuals are able, through will power and sheer guts, to make it in life.
The story goes on to declare that, in order for them to do this, we need the State to clear out of the way, let these powerful and empowered individuals access markets, and, hey presto – poverty will be sorted.
The story ends by concluding that, if you haven’t made it- if you’ve failed to get on – then it must therefore be somehow your own fault, as others have managed.
Let me say where I agree with and disagree with that story.
I agree with where we begin.
That starting point is both optimistic, virtuous and noble.
Who doesn’t actually think that each of us, as individuals, have it within us to clear our own path, to make our own way in life?
Who doesn’t think it’s important to stand up for individual liberty? I don’t believe anyone does. I bet – even in his quiet moments – even Jeremy Corbyn believes it true .
But then, just as our story grasps something true about human nature, I fear it misses a whole lot else.
It forgets that – while all individuals should be equally free – not everyone is equally empowered – either offered the opportunities or has the resilience to take advantage of those freedoms in the same way.
In a blithe, off-hand kind of way, the story just kind of assumes everyone does and leaves it at that.
And it picks sides. It enshrines individual freedom – good. It then sets up State action as its polar opposite, as the enemy of progress. Not so good.
It doesn’t, if I’m honest, speak to my life or my belief as a Conservative.
I believe that we as a party are now moving to a deeper, more complex position.
…one that is now trying to see beyond the easy simplicities of the past and move to a better, more nuanced understanding of how we address poverty.
I’m at a disadvantage this evening because that case was set out far more elegantly that I could only three weeks ago, by the Prime Minister in his speech about life chances.
In it, he talked about how, if we are to defeat poverty, we need to move to a more social approach.
…which doesn’t simply look at people as economic statistics – but examines the richer picture of how economics, social problems, family breakdown and individual difficulties combine and conspire to leave people behind.
Now, don’t get me wrong: I am explicity not saying that income and money and the benefits at the end of the week, don’t matter. Of course they do; and it is patronizing to suggest otherwise.
But only focussing on the economics doesn’t quite get the nub of it.
And there is, in the Conservative party, a growing interest in how we deal with these human problems in a more social, a more rounded way.
Again – let me repeat – I am absolutely not saying that sustaining benefits and income for the poor is somehow unnecessary – we have a welfare state , and it is one of our great achievements.
I also would argue that it is only through building the economic security of our country, with a Government in charge that is trying to grow our wealth for the long term, that we can afford these benefits in the first place.
But that can’t be it alone – we need to dig deeper.
As Joseph Rowntree himself famously put it: “Much of the current philanthropic effort is directed to remedying the more superficial manifestations of weakness or evil, while little thought or effort is directed to search out their underlying causes.”
I agree with that. And we can’t, as Conservatives sit back and ignore it.
We should be clear – it is quite simply wrong for us to accept a country where it is better for your life chances to be rich and thick; rather than poor and clever.
That it is wrong for – in Scotland – a child from our poorest area to be twenty times less likely to get 3As at Higher than a child in our richest areas.
That we should not accept a situation where– by the age of 5 – children from the top two deciles are fully 13 months ahead in their vocabulary than children from the bottom two.
We believe that, together, our social institutions – the family, community and –yes – the Government – can help to create a more balanced and equal society.
So what does this look like in practice? Allow me to talk about two visits I have made in the last few months.
The first was to the Dundee Families Project last summer. Outside, it’s a scruffy grey block of flats on the edge of the city, the kind of place that doesn’t feature on estate agent windows.
Inside, it’s an utter inspiration. We went in and spent an afternoon speaking to a young couple whose three year old son was playing in the room next door.
The dad had a history of alcohol abuse. The mother, still in her teens, suffered from bipolar disorder. They had been deeply in debt and out of work. Their life was spiralling into chaos, with their child facing an upbringing in care.
Then the Project got involved. Its method is to bring such families into one of the flats, where trained personnel are on hand 24 hours a day to help them with everything they need – cooking, bills, timekeeping, you name it. They didn’t do everything for the family, but taught them to do it for themselves. The couple had stayed there for a few months.
And they told us about how they planned to get their lives back on track. How they just wanted to build a stable home for their child. They weren’t oblivious to the challenges they faced. But now, they believed they could overcome them. The Project had given them the stability and the confidence to cope with their issues.
The other visit I made was in Manchester a few weeks later – to a project called Reclaim, which works with young people from some of the city’s toughest estates, giving them the soft skills to aspire for better things.
It wasn’t the easiest trip for a Tory to make. It was during the Conservative Party
Conference and the young people were running a campaign – pointing out that while 19 Prime Minister’s went to Eton, – the whole of Moss Side, Salford and Gorton have yet to produce a single occupant of number 10.
A statistic I have yet to share with our current PM….
Again, it was a complete inspiration. We met youngsters from tough backgrounds who told us how they were going to blue chip companies like KPMG giving presentations, demanding internships.
Having met them, I would fear for KPMG’s HR people if they had the temerity to say No.
Now, I know politicians like me always draw lessons from visits like this which tally with our own political philosophy.
But it does seem to me that there are some obvious points to be made from such projects.
They need funding and supervision – which is where government comes in.
But it’s the networks that make them work – the networks between government, community, local families and individuals.
It’s when we connect that we make progress.
And I think there are some other lessons to be drawn too, of how this interwoven society gets the best results.
By intervening as early as possible, so we prevent social problems occurring or escalating.
By government and society taking joint responsibility for creating a genuinely meritocratic education system
And by not giving up – by understanding that early intervention isn’t just about supporting babies and toddlers – and then declaring that you’re on your own.
It’s by recognising that it means intervening early at every stage of life when peoples’ lives are upended by poor health, by mental illness or redundancy, when support is so required.
That’s not bleeding heart liberalism by the way. It makes fiscal sense.
In Scotland, a Commission led by the late Campbell Christie not so long ago examined the future delivery of public services. It concluded that “dealing with negative demand – ie: negative outcomes retrospectively, absorbs 40% of local public service spending”.
We are, in other words, spending £4 out of every £10 alleviating social problems that could have been avoided – we are spending money tackling the consequences, not the causes, of poverty.
So the question is: at a time when finances are tight and as we try to reduce the deficit hanging over us, how do we best use those resources to make this shift?
I am about to take part in an election at the Scottish Parliament so forgive me if I keep my answers to issues which are devolved.
First of all, child care.
Both north and south of the border, governments are now offering significant extra funding for childcare. In Scotland, the proposal by the Scottish Government is to extend childcare for 3 and 4 years olds to 30 hours a week, mirroring the UK Government’s extension.
I know this is an issue close to your heart. Indeed JRF published a paper on this only last week, emphasising the need not just for more hours, but for more high quality care.
I would add something else. The proposals the Scottish Government have announced for 2020 apply to more hours for 3 and 4 year olds.
Given the gap that opens up among children from poor and wealthy homes before the age of 3, we think action is required earlier.
So in our manifesto for the Scottish election, we will argue that instead of extending that provision across the board for 3 and 4 year olds, we should provide more high quality childcare for more 1 and 2 year olds, starting with those in disadvantaged homes.
We also believe more funding will be required to train up a more highly qualified professional workforce to carry out that childcare. As JRF suggests, there has to be a point to this childcare.
It has to be about offering proper early years skills to children, developing literacy and numeracy, so that the gap that opens up at this young age is closed.
I think it’s the right thing to do if we’re really going to show we intend to back up our words with action – bridging the gap that currently exists after maternity leave ends and free childcare currently begins.
And once children are at school, we need to continue this work.
We need to learn from the excellent work of Professor Sue Ellis in Scotland where focussed work on literacy in disadvantaged areas has had huge effects in boosting pupils’ performance.
We would introduce Teach First in Scotland, recruiting the best graduates we have and directing them towards our most challenging schools.
We would buddy up the worst and best schools so that no schools were, in the words of our former Education Secretary, allowed to “drift”.
And we would ensure that funding for poorer children followed the child, rather than was handed en bloc to some poorer local authorities by government, as happens now.
And we need to extend the support around our schools and colleges as well.
This goes back to what I was saying about early intervention before. If young people are in danger of simply dropping out of schooling, we need to act.
And how telling – and how depressing – is it that we have a nickname – NEETS – specifically for young people who are excluded? Doesn’t that just show the need to act?
So I’d like to see more mentoring and outreach programmes.
And I think we need to do far more to support Further Education and Apprenticeship programmes so young people can get the skills they need.
As JRF has found, four out of five young people going from unemployment into poorly-paid work are still in low paid work ten years later. We talk about providing a ladder of opportunity for young people – too often, that ladder runs out of rungs all too quickly.
And the truth is that, for all their complaints and hectoring of the UK Government’s supposed unfairness, it is the SNP Government in Edinburgh which is the worst offender here.
Only last week, we had statistics showing that Scotland has the lowest percentage in the UK of state school pupils and college students winning University places.
They also showed that – while there was an uptick of deprived kids getting into Uni – the rise elsewhere in the UK was much greater.
I have to say, I find the SNP’s moral superiority complex appalling in this regard.
You may have seen the photos: not long before he left office, our former First Minister – never one to hide his hubris – arranged for a monument to be built at Heriot-Watt university in Edinburgh praising his decision for government to meet the cost of tuition fees in Scotland.
Well, what he didn’t mention was how the cost of that free tuition led to funding for Further Education being slashed, with a reduction of 152,000 places as a result.
Classic SNP: a middle class freebie, tarted up as an egalitarian policy, slashing funds for less high profile areas – and slaps on the back all round.
Well, I reject the cosy consensus in Scotland, led by the SNP and Labour, which congratulates itself on providing “free tuition”.
My view is different: I would bring in a graduate contribution – no upfront fees and not anywhere near as high as here in England.
I would use those funds to back bursaries for poorer students, and I would reverse the SNP cuts on FE Colleges.
I reject entirely the snobbish view that values Higher Education much more than vocational and practical training. Do the Germans think like this? Of course they don’t. It is time we redressed the balance.
And lastly, I couldn’t make a speech at the Joseph Rowntree Foundation without mentioning housing.
I want to encourage more house building in Scotland. We have seen work done to address house buying – schemes like shared equity, government grants and Help to Buy..
But I want to address housebuilding, by giving encouragement and certainty to both public and private housebuilders and also through a comprehensive revamp of our planning laws in Scotland.
The lack of new housing built in recent years has been shameful. The UK government has committed to building one million extra homes. I want to see a similar sense of ambition from Scottish Government too.
So these are the kinds of policies I’ll be taking forward over the next few months at the Holyrood election.
I will close shortly – but this being a UK audience, I’d like to end this evening by expanding my argument beyond the confines of my job.
We live in a time of ever increasing resentment at the perceived inequalities around us – one highlighted by the row over the tax paid by multinationals in the last few weeks.
As I said in a speech last week to the David Hume Institute, it might be right to say that Google, Apple and the rest have paid the tax asked of them. But it doesn’t feel right – not when small firms and families have no choice in the matter.
In other words, it feels too often that there is one rule for those at the top, and one rule for the rest of us.
We ignore this growing sense of resentment at our peril. And if you want to see what happens when we do, look at the anger and resentment felt by people voting in the primaries in America right now. Or in Greece. Or the rise of the Front Nationale in France.
We must take some practical steps to address this.
So let me suggest just one.
One thing that I would like to address is the question of fairness at the workplace.
It is a fact that FTSE 100 CEO pay is now 183 times that of the average employee, compared to just 47 times in 1998.
And, not surprisingly, this breeds resentment and anger.
A recent study by CIPD – the Chartered institute of Personnel and Development -found that seven in ten employees in the UK believe CEO pay in the UK is too high or far too high.
Six out of ten concluded that the high level of CEO pay demotivates them at work. A similar number think it damages their reputation.
Now there have been several proposals put forward about CEO pay – capping it, for example, so that it can only be a certain multiplier of the lowest paid at an organisation.
That seems to me to be a recipe for confusion and bureaucracy.
However, I do think we should consider the CIPD’s proposal for companies to ensure that reward packages are more aligned to financial and non-financial performance.
Not just based on profit margins – but also on how engaged employees are, and how workforce development is improved. Publishing the pay gap, having employees on the remuneration committee.
I don’t really think people resent the fact that a Chief Executive gets paid well or is the highest earner in an organization.
I think they DO resent it when they see CEOs cashing in hundreds of thousands in the bank no matter whether the company they run is going up in the markets or going down the pan. I think they resent it when record bonuses are paid to the boardroom, when members of the workforce are laid off or facing a pay freeze.
So to sum up, as JRF rightly say: “Poverty is a cost that the UK cannot afford.” And they are right: we need to move from treating the symptoms of poverty to tackling its fundamental causes.
I could have stood here tonight and read directly from the Conservative CCHQ playbook.
That since Conservatives took office in 2010, millions of low paid people are better off.
Employment is at its highest ever level.
More low earners have been taken out of tax, the minimum wage is about to have its biggest ever rise – the state pension already has – and that’s why, as well as the lowest level of child poverty since records began; the GINI coefficient which measures inequality has also dropped.
All of which is true, and none of which you want to hear.
It’s also not the speech I wanted to give. Raw numbers don’t speak to real people.
I want us to have a more thoughtful debate.
I believe we should not stand idly by as we watch failures of both State and market alike affect poverty and gross inequality.
This should be our priority.
And while you may find it easy to criticize the centre-right when it comes to reducing poverty – no doubt some of that criticism merited – I would ask you to honestly recognize success where it arises.
And I would argue that it is precisely the things that make us Conservatives – respect for institutions, a belief in the individual, a One Nation outlook – that provide some of the answers to how we make poverty history.
So if we do leave aside the easy slogans:
It is possible to say; all at the same time:
We are individuals
The State doesn’t have all the answers
The market is not king
There is such a thing as society
And Government can be a force for good.
Ruth Davidson MSP is Leader of the Scottish Conservative and Unionist Party and a member of the Conservative Trade Unionists Advisory Panel. She is on twitter at @RuthDavidsonMSP