Downgraded to AA1 – what’s it stand for?*

With thanks to Joe C.

It’s all been said – but not everybody’s said it.  So here goes.

On Friday, the ratings agency Moody’s decided that the country’s growth prospects were so poor that the AAA credit rating should be downgraded.   As almost every commentator has pointed out, preserving the credit rating has been cited on many occasions by Osborne as the acid test of his economic policy.  In 2010 he said ‘Our first benchmark is to cut the deficit more quickly to safeguard Britain’s credit rating… we will protect Britain’s credit rating.’

And are we likely to see any changes from Osborne now that his ‘first benchmark’ has failed? In brief, no: he has assured us that the downgrading confirms that his approach is right, so he'll carry on with the austerity programme.  Osborne’s behaving like a mediaeval blood-letting physician: “We drew a pint of blood from the patient but he’s not recovered yet so we'll just draw a few more pints…’

Anyone who knows me (or who has read any of the earlier posts) won’t be surprised that an old Leftie should think the Chancellor’s got it massively wrong.  But I'm not alone.  Others, not best known for their left-wing views (unless they are the best-disguised Entrists since the Militant Tendency) agree with me.  Those urging a change of tack include:

• The Daily Telegraph: One last chance to go for growth - Telegraph – an editorial opened bluntly by saying ‘The Coalition’s economic policy is not working.’
• The CBI – last summer the Director General strongly criticised the government for the “really disappointing” implementation of its growth plan
• The IMF – until recently a (somewhat half-hearted) support of the austerity package, whose chief economist said in January:  "We said that if things look bad at the beginning of 2013 – which they do – then there should be a reassessment of fiscal policy."

It’s not clear that anything will persuade Osborne not only that the policy isn’t working, but that it’s actually making it harder to reduce the deficit.  There was an interesting analysis recently by the Resolution Foundation (Squeezed Britain). They calculated that if all public sector workers’ pay were raised to the Living Wage standard, it could result in a net saving of £2.2 billion – because of increased income tax receipts and reduced benefit payments.  And as those receiving the extra money are still on low incomes and are therefore unlikely to save a great deal, it would go straight into the economy buying goods and services and of course, generating extra VAT. 

If the Resolution Foundation is correct this seems a sensible course of action. But it won’t happen under this government because that would mean George admitting he is wrong – and it seems that won’t happen anytime soon.

*Oh by the way, it stands for Arseholes Anonymous.

"My name's George and I'm an arsehole." 

If at first you don’t succeed…we’ll give you another large contract anyway

Update: There's a YouTube film of one man's account of his ATOS interview:
https://www.youtube.com/watch?feature=player_embedded&v=tG9a22hbrcY# …! #atos #wowpetition Watch it and hunt out the petitions being launched by change.org, 38 degrees, and on government sites

From April this year, a new benefit called Personal Independence Payment (PIP) will replace Disability Living Allowance (DLA) for disabled people aged 16 to 64.  For those already receiving DLA the new benefit will be phased in, but new claimants will have to make apply, triggering a process that will mean, according to a government website, that most people will have to ‘…attend a face-to-face consultation with a health professional as part of the claim.’   And the health professionals will be supplied by Atos, as part of a £400m contract awarded to the French company by the Department for Work and Pensions lat year.

Apart from their sterling role as sponsors of the Paralympics (another reminder of the death of satire – a phrase first coined in 1973 by Tom Lehrer when Henry Kissinger was awarded the Nobel Peace Prize), Atos are currently responsible for conducting the now notorious Work Capability Assessments (WCA).  These are the tests applied to determine whether those applying for (or indeed in receipt of) sickness benefit are actually fit for work. 

The tests, which were launched in April 2011, were designed to make sure that no-one who was genuinely fit for work should receive sickness benefit.  In the first year of operation almost 40% ‘failed’ the test and were denied sickness benefit.  However,   a recent House of Commons research paper (The Work Capability Assessment for Employment and Support Allowance) confirmed that on appeal almost 40% of these assessments have been overturned.   In other words almost 40% of the assessments made by Atos health ‘professionals’ have been wrong. Successful appeals – overturning the original assessment – have hovered just below 40% ever since the start – and despite a series of independent reports with numerous recommendations for improvements. However, where claimants were represented by support organisations like CAB the figure rose to 80%. 

PS. A recent survey of CABs showed that at least a third had had their funding from local authorities reduced as a result of government cuts.  in consequence a number have already closed and others are under threat. 

The money goes round and around...

An earlier piece in SIC described the rewards for failure handed out to Atos (Subversive Inappropriate Cartoons: If at first you don’t succeed…we’ll give you another large contract anyway), the company contracted by DWP to carry out Work Capability Assessments, and subsequently, assessments for the new Personal Independence Payment. A story in last week’s Guardian (Atos subcontracts tests for new disability benefit to NHS | Society | The Guardian) revealed that the company is now subcontracting some of the tests back to the public sector!  A number of NHS trusts are already carrying out the work, and Atos has approached others.

We don’t know how much Atos receives for each test, how much it pays the Trusts, and how much the administration of all this costs.  SIC is submitting a Freedom of Information request to DWP to try to find answers – and when we hear we'll publish the results here.

  

At risk: an A&E near you

News about the NHS recently has been dominated by the publication of the Francis report on Mid-Staffordshire Foundation Trust.  Before that the focus was on the local campaign to save Lewisham A&E (actually just the most-publicised of many local battles to protect casualty services).   Underneath the headlines, these very different cases raise similar issues, fundamentally centred on two key questions: first, how to maintain a comprehensive national health service; and second, how to avoid (and reverse) the drift to privatisation, started by the last government but gaining momentum under the Tories?

It would be idiotic to suggest that both these cases were ‘just’ a matter of funding.  Not all Trusts – however cash-starved – have displayed the chronic lack of leadership which, the Francis report argued was one of the critical problems in Mid-Staffordshire.  And there are real issues about how to manage the competing demands of local accessibility, and the development of specialist centres, in an NHS having to cope with an ageing population – and this would be true however the NHS is managed.  But in both instances funding issues are not far from the surface.

The focus on A&E (and maternity services) in Lewisham arose principally because of the financial difficulties experienced by the neighbouring South London Healthcare Trust (SLHT).  This organisation faced bankruptcy largely because of the debts incurred through the previous government’s flirtation with privatisation in the shape of the Private Finance Initiative.  To rationalise health provision across South London, Jeremy Hunt was presented with a recommendation to close both services.  In fact he rejected the recommendation, opting instead to downgrade both, a compromise that still failed to meet local objections. 

In Mid-Staffs, the appalling conditions experienced by large numbers of elderly and vulnerable patients cannot be explained just by financial problems.  Nevertheless the Francis report said that a chronic shortage of staff, particularly nurses, was largely responsible for the substandard care.  As with SLHT, Staffordshire’s problems derived partly from debts incurred because of its Trust status. In 2006/07 it was required to make a £10 million saving, which the Board decided could only be achieved through cutting already insufficient staffing levels. And the rest, sadly, is history.

Both sets of problems predate the present government, and should be taken as warnings about the dangers of introducing market principles to health care.   But quite the reverse: Hunt (and Lansley before him) have concluded that the way to deal with failing marketisation is to introduce even more. 

Despite all the promises (summed up in a key poster during the election claiming ‘we’ll cut the deficit, not the NHS’) at the end of last year the government was forced to concede that in real terms spending on the NHS had been cut since 2010, despite numerous statements from ministers to the contrary.  Only two months earlier Hunt had assured the Commons that "Real-terms spending on the NHS has increased across the country."  And the cuts are quite separate from the government’s plan to make £20 billion of efficiency savings from the NHS by 2015.

The Lewisham case in particular provides one example of how these ‘efficiency savings’ are to be made.  A national review of casualty departments is underway, reviewing the prospects for the introduction of a two-tier emergency service.  And of course Hunt’s compromise in Lewisham is for exactly that – by opting to downgrade the Lewisham A&E, he took the first steps towards a two-tier service.  And it seems likely that the SLHT will be divided up and offered out for full-scale privatisation.  

The campaign in Lewisham may have succeeded so far; but given the drive for more savings, the spread of privatisation, and the fall-out from PFI debt, there is no guarantee that what’s left of any local A&E is safe in the longer term.

Gove: Ebacc to basics

Gove’s announcement that he is to abandon plans to replace GCSEs with an ‘English baccalaureate certificate’, or e-bacc for short, was described by his Labour shadow as a "humiliating climb-down".  Gove probably had no choice: as the TES put it, he ‘…appears to have done that rare thing in politics – he’s come up with a policy that almost no one supports.’  Opposition had come from among others, teachers, academics, the CBI, the Lib Dems (though junior education minster David Laws appeared to deny this), and his own back benches. 

According to Gove’s officials, there were a number of factors behind the decision, but principal among them was the fear that a proposal to hand each of the core subjects to a single examination board would be contrary to European competition rules. If so the decision had little to do with the educational merits or demerits of the idea – which is a bit like jailing Al Capone for tax avoidance.

The retreat on Ebacc is not the end of Gove’s proposed ‘reforms’, the most important of which reflect his personal obsession with ‘rigorous’ exams and factual acquisition.  Unusually for Gove (who generally spurns academic – or for that matter any – evidence) he has cited the work of two American academics in support of his ideas.  However one of these inspirations has raised serious questions about Gove’s understanding of the research, claiming that reliance on rigorous exam testing can lead to sterile rote learning: Education expert cautions Michael Gove over heavy reliance on exams | Politics | The Guardian.

Undaunted, Gove maintains that ‘the accumulation of cultural capital – the acquisition of knowledge – is the key to social mobility.’  In 2007, DWP commissioned an evidence review of the Factors affecting social mobility. The report did indeed mention ‘cultural capital’, but as just one of a range of explanatory factors.   By cherry picking the evidence that suits him, Gove conveniently ignores the other factors identified – critical amongst which was the availability of early years provision. The report pointed out that ‘Convincing evidence shows that early experiences such as the quality of the home environment, family structure, pre-school care and relationships with caring adults produce a pattern of development in later life that is hard to reverse even through schooling.’

And unsurprisingly, the much richer early years experience enjoyed by children from better off families bestows advantages for which the schools system, for most kids from deprived backgrounds, can never compensate. Earlier studies have shown that just over a third of children who qualify for free school meals – often used as an indicator of deprivation – reach a "good" level of development by the age of five, while more than half other children do so.  An Ofsted report in 2008 confirmed that ‘It is clear that the association between poverty and underachievement remains strong.’

One of the main interventions introduced by the last government to improve early years provision were SureStart centres. Earlier this year the Labour Party claimed, following freedom of information requests to some 150 councils, that a reduction in local authority funding for SureStart centres of £430m had led to the closure of more than 400 of them.  The Department for Education denied this; however a survey in 2012 (4Children’s 2012 Census of Children’s Centres ) of 500 centres showed that of those remaining, more than half no longer offered onsite childcare, and a fifth were charging for services that were formerly free. A fifth had reduced the number of qualified teachers and a further fifth expected to reduce staff in the future.

Clegg opposed the Ebacc measure because alongside it, Gove planned to introduce an alternative simpler exam for those thought unable to cope with the rigours of Ebacc.  Lib Dems could not accept a two-tier system he said (though it didn’t appear to bother Laws).  But as long as the inequalities in the early years remain as stark as they are, the name, character and standard of examinations later won’t make much difference to the essential unfairness of the system.