The double whammy of ending furlough and cutting Universal Credit shows there’s no such thing as a ‘Union dividend’

Liz Saville Roberts MP writes for The Sunday Times. 

The Conservative conference this week will likely see a Prime Minister boasting about ‘levelling up’ while simultaneously plunging millions of people back into poverty through a cut to Universal Credit. This will come only days following the scrapping of the furlough scheme.

On 30 March 2020, ‘furlough’ became one of the unfamiliar terms that was to enter our common Covid lexicon – a job retention scheme which put businesses into hibernation and staff on reduced wages.

While furlough has been a lifeline for millions, many employees have been left behind by this disjointed and discriminating scheme. Freelancers, workers in the gig economy and those not employed on the furlough cut-off date have been left to fall through the cracks by Tory Ministers for whom struggling from one precarious payslip to the next is the most alien of concepts.

Women and younger workers were furloughed at higher rates, and, as the Resolution Foundation concludes, long term furlough can impact on future earnings and wellbeing.

While the precise nature and timing of pandemics can never be predicted, preparations in readiness for them should always be integral to emergency planning.

Regrettably, under-preparedness is the hallmark of this UK Government under the leadership of Boris the Unready.

The pre-Covid welfare system was not fit for purpose, underdeveloped and under-resourced, compared to other countries such as Germany where a permanent short time working programme was in place prior to the pandemic.

Had the UK Government believed in making sufficient preparations for predicted 21st century challenges such as pandemics - as opposed to, say, public sector austerity, millions of workers would have been spared the harrowing uncertainty of the Treasury’s ‘will they, won’t they’ approach to extending furlough. 

Furthermore and as the TUC has argued, the Government risks undoing the good work of the furlough scheme if it fails to put in a place now a meaningful plan that protects jobs and incomes, addresses underlying inequalities, and finally tackles the scourge of long-term unemployment which has blighted too many of our communities.

When the UK Chancellor first introduced the job retention scheme, he promised there would be “no limit” to the amount of support on offer. Tory politics is peppered with promises made and promises broken, a constant hum of hollow words from Westminster’s hallowed halls.  

The remaining million people on furlough await their fate. Some will return to work and pick up where they left off, but others will be less fortunate.

By the end of the year unemployment is predicted to rise to 6.5% - a grim autumn augurs a winter of discord and discontent.

When it comes to being short-changed by Westminster, Wales and furlough have form. The UK Government’s decision to deny Welsh workers access to the scheme during last year’s firebreak authorised by our nation’s government served only to underline the structural injustices of this Union.

When Wales has charted its own course over the last eighteen months, our communities have benefitted. Things have been done better, faster, and fairer. What is clearer than ever before is that when decisions are made in Westminster, they reflect the needs of Westminster, not the needs of Wales.

Economic independence is the key to economic justice. Only when our national parliament is empowered with the tools it needs to determine our nation’s own financial future for the benefit of our people will we alleviate chronic poverty and create an economy that works for everyone in Wales.

It cannot just be financial powers either. As a nation rich in natural resources, why do we pay some of the highest energy bills in the UK? As home to the highest incarceration rates in Europe, why can’t we have a say in how our prisons system is run? And without a railway linking the north and south of our country, why must we foot the bill for high-speed travel from London to Birmingham?

No government regardless of its commitment to medical advancement can guarantee that we won’t face another pandemic in our lifetimes. What could be guaranteed, with the political will and the belief in Wales, is that our ability to withstand such economic shockwaves once more would no longer be at the mercy of Westminster and its distant priorities.

Over a period of less than a week, the UK Government will have not only brought furlough to a halt but also ended the £20 Universal Credit uplift for thousands of families in Wales - the cruellest of double whammies and an unconscionable decision at the height of job market volatility.

When he could and should have been making the case for more powers to protect us from these destructive policies, the Labour First Minister was on his feet in the Senedd this week speaking of the so-called ‘dividend that comes with being in the United Kingdom’.

Wales’s history teaches us that a ‘Union dividend’ is nothing more than a figment of unionists’ imagination. We will only truly be able to protect jobs and drive-up wages, reverse inequalities and build a fairer nation for all when we take matters into our own hands.

The independence dividend will deliver far more for Wales than Westminster ever has.