Parliament has officially opened and the Queen’s speech has been delivered. The speech – written by prime minister David Cameron – outlined the new government’s ambitious policy agenda for the coming year. From the so-called “snoopers’ charter”, to city deals for a “northern powerhouse”, our experts are on hand to explain what it all means.
Income Tax
Prem Sikka, Professor of Accounting at University of Essex
The Queen’s speech included promises of legislation to ensure that people working 30 hours a week on the national minimum wage do not pay income tax. It also mentioned new laws to guarantee that there are no rises in income tax rates, value added tax (VAT) or national insurance for the next five years. A related government press release says that annual income tax personal allowance will increase from the current rate of £10,600 to £12,500 by 2020.
But all is not what it seems. The minimum wage rate from October 2015 is £6.70 per hour for adults. So anyone working a 37 hours a week would earn about £13,000 a year, and would still be liable to income tax.
The higher personal allowances may help the middle-classes, but will do nothing for 44% of adults whose income is already too low to pay any income tax. The poor pay VAT at 20%, the same rate as the very rich. The government statistics show that the poorest 10% of households now pay nearly 47% of their gross income in direct and indirect taxes, while the richest 10% pay 35% of their income in taxes. This imbalance is not addressed.
Devolution
Peter Lynch, Politics at the University of Stirling
So, this is what a Conservative Queen’s Speech looks like — 26 legislative proposals not watered down by the Liberal Democrats.
Some bills are in keeping with the coalition theme though, such as the various proposals for more devolution to Scotland, Wales and Northern Ireland. These were a consequence of cross-party discussions (and the independence referendum in Scotland’s case).
The Scotland bill already appeared in draft form in January as part of the government’s white paper on Scotland, which contained the proposals from the cross-party Smith Commission.
The government plans to pass legislation on these proposals in time for the 2016 Scottish elections — even though they currently seem incoherent. The plans will be subject to criticism and amendment in parliament along the way.
The bill contains plans to increase Scottish control of income tax and public spending, allocate a share of VAT and transfer some welfare powers. The tax powers are important as a measure of fiscal autonomy but also as a political tactic to support the Union through devolution and allow the Scottish Conservatives to present themselves as a low-tax party at the 2016 election.
Surveillance
Helen Fenwick, Professor of Law at Durham University
New powers to collect data were referred to briefly in the Queen’s speech and will arise under the Investigatory Powers Bill. It will cover powers that would have arisen under the Communications and Data Bill, often referred to as the “snoopers’ charter”. Without the Liberal Democrats in government to oppose it, these powers can now re-emerge. But the new bill goes much further and will increase the security services’ warranted powers for the mass interception of the content of communications.
This legislation will require data communications companies to store the details of messages sent on social media and gaming, voice calls made over the internet, emails and phone calls – known collectively as metadata – for 12 months.
It will probably require that the information is stored in a common format data in vast databases; the security services and police would be able to access this meta-data without the permission of a judge, in the interests of investigating criminal or terrorist-related activity.
The idea behind the new bill is that details and content of communications should not be kept secret, just because they exist in digital form. It aims to address the fact that terrorist and other organised criminal groups are increasingly exploiting available communications technology in a range of sophisticated ways; for instance, by using encryption, and communicating via platforms such as WhatsApp and Snapchat.
The objections likely to be made to the bill are grounded in fears about the state’s invasion of privacy, and the security of the material; those concerns are likely to be echoed by the big communications companies such as Google.
Health
Andrew Street, Professor at Centre for Health Economics at University of York
The Queen’s speech reiterates the Conservatives’ promise to implement Simon Steven’s five-year forward view, which enjoys cross-party support. This includes plans to improve access to mental health service, reconfigure services and better integrate health and social care.
Cameron is committed to a 24/7 NHS, though this doesn’t appear to be among the priorities of his secretary of state for health, Jeremy Hunt. Operating 24/7 hospital services will be expensive, estimated to increase annual costs by up to £1.4 billion – arguably too much to justify the hoped-for reduction in higher death rates over the weekend.
It will be challenging to introduce seven-day GP services when there are insufficient GPs to meet demand during normal hours, hence the manifesto promise to recruit an additional 5,000 GPs.
There was a reminder that the Conservatives have promised to increase the NHS budget, by £8 billion over the next five years. But an additional £30 billion is required to meet rising NHS demand, with a projected £4 billion funding gap for adult social care.
The government hopes the shortfall in the NHS budget will be filled by annual productivity growth of 2% to 3%, though this would be unprecedented. Funding will prove the greatest challenge for the NHS over the parliamentary term.
Human Rights
Arman Sarvarian, Lecturer in Law at the University of Surrey
The government has watered down its plan to put forward a bill on replacing the Human Rights Act with a British bill of rights, bowing to reported disquiet among senior Conservative backbenchers. As the opening of parliament approached, it appeared increasingly unlikely that the bill would survive passage through parliament without the full support of the party.
However, the Queen did announce that the government would “bring forward proposals” on this issue and it is now widely anticipated that a (presumably public) consultation will be held before measures are brought before parliament.
This bill was a key Conservative manifesto pledge in the run-up to the general election. The ostensible aim is to “break the formal link between British courts and the European Court of Human Rights” and to hand greater power to the UK Supreme Court.
Prominent Conservative backbenchers opposed to this ill-advised plan include Dominic Grieve, the former Attorney General, and former justice secretary Kenneth Clarke.
The notion that British judges are constrained by Strasbourg in their influence on human rights law is false. Whatever the avowed purpose of the reforms, their practical effect would be to threaten to subordinate judges, British and European alike, to the whims of ministers and parliamentarians on individual cases. This threatens the principle of qualified judges, not parliamentarians, deciding on individual cases.
Consulting the public is a tactical postponement of legislation. The government and the Conservative Party remain committed in principle to the proposals. The British public must use this consultation as an opportunity to register robust opposition to any change in the status quo. And Conservative Party members must put pressure on the leadership to abandon this policy and thus uphold the great Conservative tradition of robust commitment to the rule of law.
Welfare
Roy Sainsbury, Professor of Social Policy at University of York
The 2010 Queen’s speech heralded the biggest shake-up of the benefits system since Beveridge, including the introduction of Universal Credit, the benefit cap, and the bedroom tax. In contrast, this Queen’s speech is small beer; the big stuff has been done. The speech promises only that the government will “continue to reform welfare” by introducing legislation “encouraging employment by capping benefits and requiring young people to earn or learn.”
These two measures come as no surprise; we knew what to expect from the Conservative manifesto. First, the current benefit cap of £26,000 a year will be reduced to £23,000. Some families will therefore lose around £60 a week. As yet, we do not know how many, or how they will respond. To date nearly 60,000 households in total (overwhelmingly families with children) have had their benefits capped, saving around £100 million a year. Evidence shows that some claimants moved into work either before or after the imposition of the cap. The government has rather gilded these findings as a “stampede to the jobcentre” but the majority affected by the cap have somehow adjusted to (sometimes considerable) reductions in household income.
The second policy innovation applies to young people under 25, who will no longer be eligible for Jobseekers Allowance or Housing Benefit – more on this below. In essence, the policy tells young people that they are expected “earn or learn”. Will it work? A pilot in 2013 showed no impact on sustained job entries. But that was a pilot. Presumably lessons have been learned and we can only wait to see if “earn or learn” does better.
Which leaves us with the glaring omission from the Queen’s speech: the £12 billion cut in the welfare budget. As we know, repeated attempts before the election to draw the Conservatives on where these cuts will fall were met with silence. We learned nothing, and the Queen’s speech has left us still in ignorance – despite the best efforts of the IFS. But when the silence is eventually broken, all talk of benefit caps and “earn or learn” will almost certainly be swept aside, as the next big losers from welfare reforms are identified.
Youth Employment
Benjamin Bowman, PhD candidate in Politics at University of Bath
The speech included a plan to replace the Jobseeker’s Allowance with a Youth Allowance for 18 to 21-year-olds, who will now work 30 hours compulsory labour for a £57.35 per week allowance. That equates to about £1.91 per hour.
The scheme plans to enforce full employment for the young. It will also centralise control over the young workforce, as many MPs feel local government has dropped the ball. Young unemployment is extremely high, with 14.4% of those aged 16-24 out of work: the worst gap for 20 years.
Abolishing unemployment with compulsory labour is a radical move. Young citizens were worst hit by the recession, and remain extremely vulnerable to low wages and poor conditions. They are three times more likely to work on a zero-hours contract. Critics warn that the allowance is exploiting vulnerable people already struggling to find work. If so, the Youth Allowance will merely fasten another bolt on the door separating young people from the job market.
There is no point building a bridge to employment unless there are jobs on the other side. If it is to succeed, the Youth Allowance must make good on David Cameron’s pledge to build “a country that rewards work”. For young people, just like everyone else, the reward for work must be a decent, liveable wage and affordable housing. Research shows young people are supportive of pathways-to-work schemes. Now is the time for government to make sure the pathway leads somewhere.
Immigration
Katharine Jones, Senior Research Fellow at Coventry University
Having already set out his plans last week, today David Cameron merely required the Queen to assert that his government will “control immigration”. His government proposes to make “illegal working” a criminal offence in a forthcoming Immigration Bill: the tenth piece of such legislation in the past 20 years. In the bill, the wages earned by irregular migrants – that is, migrants without a valid visa – will be defined as the “proceeds of crime”, meaning they can be confiscated by the authorities.
This is to be accompanied by a raft of measures, including informing private sector landlords when their tenants’ visas expire, tracing irregular migrants through the banking system, and removing the right to appeal against deportation from inside the UK. The bill will also introduce a new enforcement agency and a visa levy on businesses seeking to recruit overseas workers. It will prohibit recruitment agencies from advertising jobs overseas, without first advertising in the UK.
Last week, Cameron that these measures will reduce immigration to the UK, prevent UK wages being driven down and stop exploitation of migrants. None of these three arguments holds up.
Having all repeatedly failed to meet their own migration targets, UK governments should accept that immigration controls turn the numbers of migrants arriving in the UK on and off like a tap. A deregulated labour market that fails to prevent exploitation and employers seeking cheap flexible labour are the pull factors for labour migrants coming to this country. Decades of research have told us that migrants do not have a major negative impact on the UK labour market. And in any case it is employers that set wages, not migrants.
So what of his third argument –- that his proposals will stop the exploitation of migrants? Rather than protecting migrants, the new measures will do the exact opposite. We already know that the sanctions on employers for hiring irregular workers harm all migrants, while doing nothing to protect the exploited. The new measures will prevent migrants from reporting abusive employers or landlords. Worse, they will criminalise migrants for their own exploitation.
Education
Michael Jopling, Professor in Education at Northumbria University
Although education policy has had a high profile since the election, today’s Queen’s speech contained only a passing reference to schools. Free schools did not feature, but the speech contained a vague commitment to giving every child the best start in life, associated with the creation of “new powers to take over failing and coasting schools and create more academies”.
There are two points to note here. First, linking coasting with failure and “takeover” will set alarm bells ringing. This remains a concern despite education secretary Nicky Morgan’s attempts in recent interviews to distinguish between “failing” and “coasting” schools, and to reassure the profession that coasting schools – however they’re defined – will be allowed to develop their own improvement plans.
Second, it signals Morgan’s desire not only to extend but also to speed up the process of becoming an academy. As the Education Committee emphasised in January 2015, and despite the government’s claims to the contrary, we have no evidence yet that converting schools into academies leads to improvement.
So the forthcoming Education Bill risks both further isolating the English school system internationally and alienating headteachers and teachers at a time when rising numbers of primary age children mean we need all the teachers we can get.
Small Businesses
Stephen Roper, Director of the Enterprise Research Centre at the University of Warwick
Small business owners listening to this speech probably had rather mixed feelings about the next couple of years.
On the positive side the proposed cuts in red tape will be welcome. The plan to establish a conciliation service to settle late payment and other disputes between small and large businesses will also be applauded.
In other countries such as Australia similar services have developed to become champions for small business interests and sometimes challenge the government on policies that are not small-business friendly. It is not yet clear whether these roles will also be part of the UK service.
The aim to offer 3 million new apprenticeships during this parliament will also be welcomed by many firms struggling to attract skilled employees. As recent debates have suggested, however, the key issue here will be maintaining quality as numbers are expanded.
The biggest negative is the uncertainty caused by the forthcoming European referendum. This may discourage some firms from investing in expanding European sales. Businesses that supply the public sector, outside health and education, may also feel the squeeze of spending cuts and the restructuring of budgets.
Housing
Anya Ahmed, Senior Lecturer in Social Policy at University of Salford
In the Queen’s speech today, the Conservative government’s priorities for social housing were announced. The main proposal put forward was to extend the Right to Buy (RTB) scheme to housing association tenants.
Around 2.5 million council tenants across the UK have already bought their homes since RTB was introduced by Thatcher’s Conservative government in 1980.
The government claims that these new proposals will increase house building and reduced council house waiting lists, by replacing each social unit sold. However, the National Housing Federation, Shelter and the Institute of Fiscal Studies have expressed doubts about this pledge being met. Shelter estimates that only one house per ten houses sold has been built since 2012 when the government extended RTB of council homes.
This raises significant questions about how the proposals will impact on the supply of affordable rented housing in the UK, significant given there are currently 1.8 million households on social housing waiting lists, an increase of 81% since 1997.
There are further important questions which remain unanswered. First, the cost implications of the scheme, estimated at £11.2 billion, and considered potentially detrimental to the UK’s economic recovery.
Although the scheme is to be funded by local authority stock sales and government subsidy, it is unclear how the scheme will work in practice or how it will be funded.
Childcare
Caitlin McLean, Ailsa McKay Postdoctoral Fellow in Economics at Glasgow Caledonian University
With the rising costs of childcare putting increasing strain on family budgets, it was good to see the government’s childcare proposals feature in the Queen’s speech.
The Conservatives have previously proposed that working parents of three- and four-year-olds be offered free childcare for 30 hours per week – extended from the 15 per week currently on offer for all families.
This is a worthy goal. An inability to afford childcare services can pose a significant barrier to parents – especially mothers – seeking employment.
But questions remain about childcare access for families where both parents aren’t currently in employment. For instance, should these children be excluded from increased childcare hours (especially given that access to high quality early education and care plays a key role in reducing inequality)? It is also unclear what will happen in the event that a parent loses his or her job – will the child immediately lose access to those extra funded hours?
And many parents would feel unable to accept an offer of employment unless childcare had already been arranged – childcare access is a prerequisite for undertaking employment, not a reward for doing so.
While targeting eligibility may save some money in the short run, it comes at a cost – increased administrative complexity and further entrenchment of educational inequality among children.
City Deals
Alex Nurse, Research Associate at University of Liverpool
If there were two major thematic elements to this Queen’s Speech, they would be the economy and devolution. Sat in the middle of the government’s legislative agenda, and neatly tying these themes together, came the proposals for the northern powerhouse, which will see a raft of powers including those for regeneration, transport and health devolved away from Westminster to the cities – with Manchester standing first in line.
This was pitched as a means to deliver a “balanced economic recovery”, fitting neatly within the Government’s “one nation” agenda. It can be seen broadly as an attempt to help the north to catch up to London, and to assuage those with itchy feet as Scotland receives even more powers.
But the explicit mention of metro-mayors gives a clear signal to cities that have yet to sign up: this is not a free ride. They will be expected to deliver, and be held democratically accountable for their actions under these plans.
The inclusion of high speed rail is no coincidence, reminding us that HS2 has yet to clear the statute books, but also that proposals for HS3 would form part of the glue holding this revamped northern powerhouse together.
About the authors:
Helen Fenwick is Professor of Law at Durham University. Alex Nurse is Research Associate at University of Liverpool. Andrew Street is Professor, Centre for Health Economics at University of York. Anya Ahmed is Senior Lecturer in Social Policy at University of Salford. Arman Sarvarian is Lecturer in Law at University of Surrey. Benjamin Bowman is PhD candidate in Politics at University of Bath. Caitlin McLean is Ailsa McKay Postdoctoral Fellow in Economics at Glasgow Caledonian University. Katharine Jones is Senior Research Fellow, Centre for Trust, Peace and Social Relations at Coventry University. Michael Jopling is Professor in Education, Department of Education and Lifelong Learning at Northumbria University, Newcastle. Peter Lynch is Senior Lecturer, Politics at University of Stirling. Prem Sikka is Professor of Accounting, Essex Business School at University of Essex.
Roy Sainsbury is Director of Social Policy Research Unit, Professor of Social Policy at University of York. Stephen Roper is Professor of Enterprise and Director of the Enterprise Research Centre, Warwick Business School at University of Warwick.
This article was originally published on The Conversation. Read the original article.
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