Danny Alexander urges the government to further greater social mobility in Britain in a Westminster Hall debate



Social mobility is especially important to Liberal principles of freedom and fairness, because a lack of it implies a lack of opportunity - an inequality of opportunity - and a fair and liberal society is one that makes the best use of the talents of everyone in that society. Social cohesion and inclusion are more likely to be achieved when people believe that they can improve the quality of life that they enjoy through their own abilities and efforts.

We like to think of this country as a meritocracy. None the less, the facts suggest that, at the very least, Britain has over the past few decades become less socially mobile rather than more. It is perhaps too early to tell precisely what impact this government’s policies have had on social mobility, given the length of time that it takes to research such matters, but the evidence from, for example, my constituency and the academic reports that we have all studied is that there are arguments on both sides about how this government’s policies have affected social mobility. There is at least as much evidence that some of their policies have damaged social mobility more than they have improved it.

The current pattern of social mobility that is presented in the research cannot necessarily be attributed solely to the efforts - or lack of effort - of the current government. It has been influenced by previous governments. I remember growing up and the damaging social impact of many of the policies that were pursued in the 1980s and early 1990s. In many cases, the effect was felt no more harshly than in parts of Scotland and, indeed, remote rural parts of Scotland. In some cases, the problems are different, but they are just as great, if not sometimes greater, than in urban areas. It may be easier to provide services in cities and towns. It can sometimes be very difficult to provide them in rural areas, which is something that often gets lost in the debate. In fact, it sometimes gets lost in the government’s approach to these policy areas. We must not forget the rural dimension.

We must also consider inequality. There is an equation between rising inequality and falling social mobility. Anyone who has studied the work of Professor Richard Wilkinson will know that there is a huge amount of evidence dealing with different aspects of life that countries that are more unequal tend to have a greater degree of social differentiation and a wider range of barriers that people must overcome. Indeed, differences in concentration of power occur not just between the top and the bottom - there is a much finer degree of gradation right through the social scale. The evidence suggests that, the more unequal the society is, the more competition there is for small advances in position. They take precedence over the larger improvement in position that we are discussing in this debate.

The larger gap between the richer and poorer in the UK is one of the factors in making it harder to move from one income group to another. It is a shameful fact that, in the UK today, the poorest 20 per cent. of people pay a greater share of their income in tax than the richest 20 per cent do. If we are considering the state’s role in enhancing the position of those at the bottom and assisting them, the tax system is important, nowhere more so than in the recent debate about the taxation of wealth.

The social exclusion taskforce report showed that incomes for the poorest 2.5 per cent. of the population have actually fallen. Incomes may have risen among all the other groups, but for the poorest 2.5 per cent. - the most deprived 2.5 per cent.- they have fallen. That important fact partly explains why the measures of inequality - the Gini coefficient, to those who are in the know - show that income inequality in 2005-06 reached its highest level since 2001-02. Statistically, it is significantly higher than it was when this government came to power.

There are two areas of policy that I wish briefly to dwell on in response to what Alan Milburn [the Labour MP who opened the debate] said in his speech. The first is in relation to work. As he said, it is critical that we direct our work and welfare policy to the objective of getting people into work, but it is also important to help people progress in work, and to move on and up - especially those groups that are most disadvantaged in employment. I refer particularly to disabled people and lone parents - I agreed with his comments about how that group is sometimes discussed pejoratively; none the less, it is a critically important group in the context of employment - but also workless households. At the bottom level of households, there is an increasing number of two-parent households in which neither parent is in work. That creates an intergenerational phenomenon that entrenches the lack of ability that he described.

The right hon. Gentleman referred to the tax credit system. There is no doubt that it has played a role despite all the administrative problems, which are beyond the scope of this debate. It clearly played a role in helping to make work pay, to use the government’s slogan, but, equally, the high withdrawal rates that then kick in have hindered the ability of people to move on in work, in some cases. There is some evidence to suggest that a withdrawal rate combined with a tax and benefits system of 70 or 80 per cent. is a disincentive. That is something that must be considered in the context of work.

There is also some indication - for example, as provided by the Joseph Rowntree Foundation - that work-related policies help to get people into work, but those entries are not necessarily permanent. Therefore, the exits from poverty that they create are not necessarily permanent, either. People may be moving back and forth across the poverty line in a way that is not actually helping to create the social mobility that the right hon. Gentleman and I want. Job retention and progression are critical to ensuring that employment leads to genuine progression up the social ladder and to real mobility, rather than to people continually moving above and below the poverty line.

It is most important that the intergenerational issues are tackled. It is not an individual’s abilities or skills that determine their educational attainment and future earning potential. Sadly, in this country at present, it is their parents’ life circumstances. Improving educational outcomes and the aspirations of children and young people are the most important factors in breaking the intergenerational cycles of poverty that are the defining feature of the lack of social mobility that the right hon. Gentleman described.

In that context, I place a great deal of emphasis on the early years. There is evidence that educational disadvantages emerge very early in life. For example, the millennium cohort study by the Centre for Longitudinal Studies at the Institute of Education published a report earlier this month that revealed that children from disadvantaged families are already lagging a full year behind their middle-class counterparts in social and educational development by the age of three.

Early years education must be a top priority, and that should be reflected in spending decisions. It is interesting to note that some of the Government’s investment - for example, in Sure Start - has not always reached the groups that are hardest to help. I think of disabled children, for example. It is not always easy for a low-income family to take up entitlements such as 12 and a half hours of pre-school education a week.

With regard to the pupil premium, the Nordic countries are much more effective at allocating resources to schools-to the most deprived areas and to the most deprived pupils - whereas in the UK and certainly in England and Wales, the existing methods for distributing deprivation-related funding are opaque and inconsistent. That is why Liberal Democrat Members have proposed a pupil premium that would attach additional funding directly to pupils who are identified as disadvantaged, which would follow them through the primary and secondary education system.

It is important to say that the impact of disadvantage on a child’s life can be seen even before school age - almost from birth, sometimes. That is why we need to focus not just on policies throughout the education system. There was a bit of a debate earlier about the private education system. By the time that a child is ready to attend a secondary school in my constituency or, for that matter, Eton, the advantage or disadvantage of their family circumstances has already had an impact. We need to consider how we can ensure that at the ages of one, two, three and four, we are helping children to beat their circumstances; we must not wait until secondary school age.

This article is based on a speech by Danny Alexander in Westminster Hall on 26th June 2007.

Danny Alexander is Liberal Democrat Shadow Secretary of State for Work and Pensions

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