New IT Disaster Looms Over Iain Duncan Smith

Iain Duncan Smith at Conservative Party Conference
Iain Duncan Smith – On the Right Track but Naive – image by Community Links via Flickr

The Daily Telegraph today reports an impending income tax disaster.

They are moving to “real time” PAYE. What this means is that any company, no matter how small, must now report any payments to staff immediately, using a new government IT system.

Even HMRC admits that only 85% of businesses are even aware of the new system. And predictably, the Telegraph is already reporting glitches with the IT. The government hardly has a great record at implementing huge new IT systems.

To compound the chaos, 55,000 HMRC staff have chosen this moment to go on strike.

What the Telegraph does not report is the reason for the introduction of the new system. It is part of the launch of Iain Duncan Smith’s new Universal Credit welfare benefit scheme.

That scheme, you will remember, replaces a raft of old welfare benefits with a single new benefit. The new UC is, of course, means tested. When people get a job, their UC is reduced, depending on their earnings. Therefore the Department for Work and Pensions needs to know their income. The more they earn, the more the benefit is reduced.

Sounds a bit like income tax, doesn’t it? And it is. As a matter of fact, there is no difference between reducing someone’s UC by £10 because of their income, and reducing their pay by £10 via income tax.

We now, therefore, have a major new IT system to tell the Department for Work and Pensions how much you earn, in real time. Your employer tells HMRC, who tell the DWP. HMRC work out your income tax and the DWP repeat the exercise to work out your benefit reduction.

The principles behind the UC are good ones – simplification, making work pay and consistent means testing. But this implementation is absolutely beyond belief.

Iain Duncan Smith was apparently told by his officials that they needed this new IT system to deliver his UC. If so, they were, quite simply, lying.

They could have simply paid the benefit and notified the tax office of the benefit, in the same way as employers notify them of income. Then the tax office could have used the tried and tested PAYE system to means test the benefit, i.e. take money back from claimants with jobs, by taxing their wages.

That would be the sensible way to do it. It would, of course, have reduced the role of the DWP and led to redundancies in that department. This may be not unconnected with the department’s apparent failure to suggest this option to Mr Duncan Smith.

If the DWP couldn’t bring themselves to be professional about it, there was another option. There was an existing benefit, Income Support, that worked in a very similar way to the new UC. And indeed, 20 years ago, Income Support was the main welfare benefit.

The new UC could have been paid using the old systems that handled Income Support. The key point is that there is absolutely no connection between the new benefit and the requirement for the new “real time PAYE” IT system.

The Department for Work and Pensions has been guilty of gross incompetence and worse, lack of professionalism, in all of this. Frankly, heads should roll in that department, very publically and without compensation. I fear though that it is Mr Duncan Smith who will find himself in the firing line when it all unravels.

And perhaps that is fair. Although Mr Duncan Smith’s benefit reforms are absolutely right, he does seem to have been pretty naive in his dealings with the DWP part of Britain’s poisonously bureaucratic State.

Sanity and Welfare

William Beveridge
It’s all gone a bit wrong since William Beveridge
Image is photograph D 17134 from the collections of the Imperial War Museums, via Wikipedia

An interesting article in the (still paywall-free for the moment) Telegraph today.

Jeremy Warner identifies most of the problems with our welfare state (and then rather unfairly accuses Iain Duncan Smith of making them worse – indeed of being the heir to Gordon Brown).

He quotes William Beveridge, whose report during the War was the foundation of the welfare state thus:

The state in organising security should not stifle incentive, opportunity, responsibility; in establishing a national minimum it should leave room and encouragement for voluntary action by each individual to provide more than that minimum for himself and his family.

Our modern, insane, welfare system has of course departed far from those principles. Mr Duncan Smith has been trying to set a saner course. But Jeremy Warner is not impressed.

On Universal Credit, Mr Warner complains that the new Universal Credit and the single rate pension are not contributory:

The [Universal Credit] is an entirely means-tested form of entitlement which bears no relationship to what you might have paid the state in taxes and National Insurance. Likewise, the single-rate state pension is a no-strings form of entitlement. It has as little in common with the concept of insurance as a minor win on the National Lottery.

He also complains that the welfare bill has been rising for decades, but quite rightly notes that most of this is accounted for by the additional costs of old age pensions for an aging population.

He correctly points out that the new £26,000 welfare cap will not affect many claimants, and also takes a justified swipe at the so-called “bedroom tax” as being bad politics.

He then scores a bulls-eye on housing:

Housing benefit provides the obvious example. This has been one of the fastest-growing areas of entitlement spending not because of deliberate sponging off the state by the feckless, but because of inadequate social housing supply for the low-paid, allowing private landlords to game the government for excessively high rents. This in turn has spawned a new, and largely parasitic, industry in buy-to-let.

And he concludes that:

I fear [Mr Duncan Smith] has barely begun in rolling back the frontiers of welfare spending.

Some good points in that article – but some critical issues missed as well.

So what would a sane welfare system look like?

Housing

Start with housing. Mr Warner is on the right track there. It is sheer lunacy paying housing benefit to private tenants. All that happens is that private rents are driven up, and private landlords pocket the benefit.

Much more sensible to have a real program of old-fashioned council house building. It would without question be much cheaper, for a start. (The maths is pretty easy to do.) And it would give private tenants who don’t get housing benefit a break, delivering lower rents for them. It would also drive down house prices, which would clearly make everyone better off – despite the peculiarly British lunacy that believes otherwise.

A program of this kind, apart from saving taxpayers’ money, would give a much-needed boost to the construction sector as well.

What’s not to like?

Benefits

Mr Warner is also hesitantly on the right track here – but hasn’t really thought it through. Right now we have at least four means testing systems – the benefit system, the tax credit system, the income tax system and now the child benefit system.

What a ridiculous way to run things. Far better to pay the benefits in full, and do the means testing exclusively through the income tax system. From the politicians’ point of view, the disadvantage would be that the real marginal tax rates we all pay would be laid bare (most people pay over 60%). But the administration savings would be huge, and the system would be much less open to abuse.

Mr Duncan Smith’s Universal Credit is a welcome step towards this.

However, he missed the opportunity to do the tapering of it through the tax system. (Both Mark Wadsworth and I suggested this in Mr Duncan Smith’s consultation on the new system, but I guess the civil servants never let the suggestion get anywhere near Mr Duncan Smith.) Also, he let his officials persuade him that they needed a £1 billion real time income notification system to deliver the new benefit. Clear nonsense – and given the government’s record on delivering big IT projects, a pretty big concern.

But let’s not be churlish. Mr Duncan Smith, the “Quiet Man”, has been making a big hash of explaining the new system, but the system will actually be an improvement on the old one.

A Universal Credit would be at the heart of a sensible benefits system. The difference would be that it would be paid in full to all claimants, and clawed back when people started earning, via the income tax system.

Care of the Elderly

There has been a great deal of cant about this recently. The biggest nonsense has been talked about funding old people’s homes. The government (and the previous one before it) have been trying to prevent people having to sell their homes to pay for “care”. Who gets hurt by those sales? The elderly people themselves? No way.

Their heirs are the ones who are upset, because they don’t get to inherit their parents’ house. A big raspberry to them. If they want the cash, they could of course consider looking after their elderly mums and dads themselves. If they want an old people’s home to do the work instead, and their mums and dads have big assets, then why should taxpayers fund the protection of the kids’ inheritance?

Pensions

On pensions, the elephant in the room is the lie that has been at the heart of the old age pension system ever since it was introduced. The system pretends to be a funded pension scheme. You pay into a “national insurance account” and get your pension as a result of entitlements built up by these payments.

But the truth is that these “funds” never existed. They were grabbed by the government from day one to pay the pensions of current pensioners.

What this means is that the idea of the old age pension as a “contributory benefit” is basically a lie. It is funded out of tax, and national insurance is really an additional income tax.

So why not simplify the system by merging income tax and NI? (As UKIP have proposed by the way, and as the government is creeping towards doing.)

So a sane welfare system would pay a basic pension to all, a credit to poorer pensioners, and tax people’s private pensions. In other words, a sane system would treat pensioners exactly the same as working-age benefit claimants – with a Universal Credit, and withdrawal via the income tax system. The only difference would be that pensioners would not be expected to be “available for work” to qualify for the benefit.

Immigrants

Of course a sane welfare system would not pay benefits to EU immigrants as soon as they land in the UK. A sane welfare system would not pay child benefit to Polish or Latvian immigrants for children who still live back home in Poland and Latvia.

Sanity of that kind would, of course, mean leaving the EU. So it is anathema to the establishment political parties.

Welfare Reform – and the Philpotts

Any welfare system is always a balancing act – between providing support to the poor to prevent their becoming destitute, and not providing enough for it to be a lifestyle choice to remain on benefit.

The Conservatives – in their guise as the nasty party – often rant on about the problems being the claimants’ fault. George Osborne was at it again today, in response to the awful Philpott murder case:

Mr Osborne was yesterday asked during a tour of a brewery in Staffordshire whether he thought the Philpotts were indicative of the type of people on benefits in the UK.

“I think the question for Government and society, if you like, is a broader one about the welfare state and a question we ask on behalf of the taxpayer about whether we should be subsidising these kinds of lifestyles,” the Chancellor said.

No, Mr Osborne, “these kinds of lifestyles” really are not typical of welfare claimants.

He got enthusiastic support from Tory MP Priti Patel, though, who said:

I completely support George Osborne’s comments. We are at a stage where society has to look at the way benefits are used and abused.

The Philpott case typifies that and it is absolutely legitimate to ask these kinds of questions.

No, Ms Patel, the Philpott case does not typify Britain’s welfare claimants at all. It was an extreme case of ghastly evil, and it is pretty rum to suggest that abuses like theirs are widespread – or to hint that everyone on welfare is morally repugnant.

Reform

What we need is some serious thought about reforming Britain’s creaking welfare system, not cheap political point-scoring. All credit to Iain Duncan Smith that, unlike most Tories, he doesn’t seem to indulge in it.

Perhaps a future government will build on Mr Duncan Smith’s Universal Credit to create a genuinely sane and fair welfare system, that provides a safety net for the poor without bankrupting the rest of us. In other words, perhaps a future government will build on Mr Duncan Smith’s work to return us to the principles of that original welfare system envisaged by William Beveridge.

Child Benefit – Time for Mr Osborne to Eat Humble Pie

 

George Osborne in 2007
Image by Ewan McIntosh via Flickr

George Osborne’s child benefit grab seems to be in yet more trouble/.

His plan, announced a couple of years ago, was to take child benefit away from families with a higher rate taxpayer.

You could criticise that plan on several grounds (and indeed I did on this blog!). The most important is of course that cut-off at the higher rate threshold. If your income goes one single pound over the threshold, you lose ALL your child benefit. Other objections include the administrative complexity, and the fact that a household with two lower rate taxpayers would get the benefit, while one with just one higher rate taxpayer would lose it.

And finally, nobody knows what their exact income will be until the end of the tax year. So people just at the threshold might get the benefit and then later have it taken away, once their income was known and it became apparent they had gone over the threshold.

All these objections were completely obvious and widely foreseen within a couple of hours of Mr Osborne’s original announcement.

The government now appears, predictably, to be struggling on the issue.

First up was David Cameron:

Some people say that’s the unfairness of it, that you lose the child benefit if you have a higher-rate taxpayer in the family.

Two people below the level keep the benefit. So, there’s a threshold, a cliff-edge issue.

We always said we would look at the way it’s implemented and that remains the case, but I don’t want to impinge on the Chancellor’s Budget.

Well done Mr Cameron. You noticed two of the three serious issues with this. Marks for that, but marks deducted for mixing them up. The cliff edge issue has nothing to do with the two-earner issue.

Next up, Mr Cameron’s friend Nick Clegg:

He old Sky News the Government wanted to “make sure you don’t create these unintended consequences where say a family with one earner gets child benefit removal when there’s another family with income earners who actually collectively earn more but keep the benefit – so we’re looking at that kind of stuff”.

He said: “But we’ve always said we would be pragmatic about how we administer it but sticking to the principle that people at the top should be asked to make sacrifices because we live in very difficult times and people with the broadest shoulders have to bear the biggest burden.”

That’s a fair amount of waffle, but I think it broadly meant that Mr Clegg wanted to take the credit for any climb-down.

Meanwhile, Mark Reckless is leading a Conservative backbench revolt against the proposals.

While all these politicians scramble to keep the egg off their faces, their officials seem even more at sea.

Last night Mr Osborne’s aides confirmed that officials were now examining ways to mitigate the impact of the cap, although any measures would most likely not be made public until after the Budget on March 21.

Sounds good. So what are they thinking of doing?

Under one idea, the cap threshold would be increased from £42,745 to £50,000 to allow more families on middle incomes to keep the benefit.

Fail. All the issues with the proposal would remain exactly as they are today, except that a slightly different group of people would be affected.

Another possibility is to withdraw the benefit from high earners when children reach the age of five. Currently, parents can claim the benefit until their children are 17.

Fail. That wouldn’t tackle any of the issues with the proposal either. But it would also increase the complexity still further.

A further idea is to take away half of the benefit from families in which only one earner pays tax at the 40 per cent rate on their income.

Getting a bit closer. At least that would make a serious attempt to tackle one of the issues. the downside would be though that the complexity would be hugely increased. And it wouldn’t tackle the other issues with the proposal.

The Telegraph quotes a Treasury official as saying:

We always look at ways of how to implement things to make it better for people. But the politics of this is massively difficult. We are looking at all options.

Well, I guess the politics is always pretty difficult when gross incompetence and stupidity has got you into a hole.

When you do get into a hole, though, the best thing is to stop digging. Mr Osborne ought to withdraw the proposals and not raise them again until he and his officials have thought them through properly.

Would You Like Left or Extreme Left?

 

Tax
Image by 401K via Flickr

Help Yourself – But Please Don’t Take More Than £26,000

The Alice in Wonderland nature of our politics has been exposed again today.

The Government wants to restrict the total benefit available to a household to £26,000 per year. That is, apparently, the average wage earned by working households after tax.

Now you might think that quite a modest proposal. Households on benefit are living off other people’s taxes. Stopping such households getting more in benefit than the AVERAGE taxpayer household is getting in wages, sounds pretty tame. It will apparently affect only 67,000 families.

In fact, in a sane world, we would be arguing about why the Government did not go further. Perhaps capping benefits at the minimum wage for example. The minimum wage is £6.08 per hour, or £12,646 per year. You would need two earners on the minimum wage to equal that proposed £26,000 cap – and that’s before taking into account the taxes they would pay.

Many millions of people in this country will be angry today at the very idea that there are 67,000 households getting more than £26,000 per year of other people’s taxes.

Labour, however, were against the proposal for other reasons. They thought it too tough. They backed an amendment proposed by some Church of England Bishops who wanted to exclude child benefit from the calculation.

That amendment would in effect increase the cap to £50,000.

It would be hard to find a more telling signal that the Church of England does not care for decent hard-working poor people, struggling to pay their taxes.

The Lords overall passed the amendment. Iain Duncan Smith, who seems to be one of the few sane people in our politics, has vowed to reverse the decision in the Commons. We must hope he succeeds – but we must also recognise that this measure can only be a very small start in the process of slashing back the welfare state. Britain’s taxpayers have had enough.

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George Osborne – Guilty of Bad Administration as Well as Being Wrong

 

English: George Osborne MP, pictured speaking ...
Image via Wikipedia

George Osborne – Incompetent as Well as Plain Wrong

More idiocy from the government on child benefit.

You will remember that George Osborne announced some time ago that child benefit would be scrapped for higher rate taxpayers. That was later clarified to mean that any family with at least one higher rate taxpayer would lose the benefit.

And that means all of the benefit. If you go over the higher rate tax threshold by a single pound you lose all your child benefit – which for a family with three children is £2,500 per year.

In other words, this would create a massive benefit trap with a huge spike in effective marginal tax rates to 2500%.

Others pointed out that a household with two earners each just below the threshold – with a household income of £80,000 – would get the benefit. Those with one earner earning just above – with a household income of say £45,000 – would not.

There has therefore been much talk of “fairness”, with the government saying it is not “fair” to give the benefit to the rich, while the Opposition say it is not “fair” to single-earner households.

Chris Leslie, for Labour, said:

We have repeatedly warned that the Government’s current plans to cut child benefit are unfair and highly bureaucratic.

Highly bureaucratic! That really is a bit rich coming from the party that invented the hugely bureaucratic and disastrous tax credit system. But in this case, he’s right – replacing a non-means tested benefit by a means tested one will be bureaucratic.

The amount of hypocrisy flying around from both sides on this is in fact quite stunning. The government talk as if giving taxpayers a bit back in child benefit is very generous of the government. The Opposition talk as if they understand the concept of efficiency, which they absolutely do not. It is hard to avoid the impression that none of them believe any of what they are saying.

But my especial contempt on this is reserved for George Osborne. This is, as I said, a ridiculous proposal in the first place. But even if you accept what he wants to do, there is a much better way to do it.

The tax credit system is an appalling mess. But it exists. So if Mr Osborne wants to means test child benefit, all he has to do is scrap it and add the same amount to the child tax credit.

Tax credits are already means tested, so no new bureaucracy to add. In fact, it would remove the small amount of bureaucracy that is currently needed to administer the child benefit system.

Tax credits are already based on household income rather than individual income, so no anomalies about two-earner versus one-earner households.

Tax credits are not cut off bang when you go above some arbitrary threshold. They are tapered, so as you earn more, the credits are gradually removed. So no benefit trap.

Perhaps Mr Osborne is worried about the political impact of looking like a socialist by accepting the principle of Gordon Brown’s tax credits. That would mean he is hoping to hide his acceptance of Mr Brown’s socialist ideas by messing around with child benefit instead. But even in this case, he could always call the new addition to the child tax credit the “child benefit addition” or something.

What’s not to like, then, from Mr Osborne’s point of view?

There are political objections to Mr Osborne’s plans to means test child benefit. Some (though not I) would even say that child support is wrong anyway and the State should not provide it.

But regardless of those political debates, Mr Osborne’s plans as they currently stand are simply a piece of crassly bad administration. His civil servants should be ashamed of their gross incompetence in putting them forward in that way.

And Mr Osborne should be ashamed of being stupid enough to listen to them.

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More Labour Lies on Child Poverty – This Time from a Tory Government

 

These children live in a garbage dump
Image by GlacierTim via Flickr

Message to Mr Milburn: This is Called Poverty

Alan Milburn was talking about child poverty on the radio this morning. He said that the government’s targets on reducing child poverty will not be met.

The target in question was adopted by the last government. When Mr Cameron and the Tories came into power, they kept the target.

For good measure, Mr Cameron appointed former Labour Minister Mr Milburn to oversee progress. Since Mr Milburn is a Labour politician, it is not particularly surprising to find him criticising the Tories for not helping the poor.

What is surprising is that he was appointed at all by Mr Cameron. It was one of those tactical errors to which Mr Cameron seems to be awfully prone – he thought that bringing Mr Milburn on board would neuter his opposition to the government. He seems to have forgotten that in his new position, Mr Milburn would actually be given a platform and more credibility for his criticisms.

We need to really understand what we are talking about here.

The target in question is that child poverty should be eliminated by 2020.

On the radio this morning the BBC presenter explained that the target was based on “relative poverty”. He claimed it meant people being much less well off than their peers, such that they were not starving, but they did not have enough money to play a full part in society.

That was particularly disingenuous nonsense from the BBC.

The government’s definition of poverty is having a household income less than 60% of the median. For a couple with two children, the latest figures show a median income of £631 per week. The “poverty line” is therefore 60% of that, or £379 per week (2009/10 figures). In terms of income per year, the poverty line for that family is £19,708 per year.

Note that these figures are for “net disposable income”. In other words, they are figures after tax, but including benefits received. That couple with two children would be receiving child benefit of around £25 per week, and also tax credits.

Now let’s imagine a household with two children, in which one of the adults has a job, and earns just enough to put him or her into the higher rate (40%) income tax bracket. That would mean a salary of £43,875, or £844 per week. (I couldn’t find the rates and thresholds for 2009/10 so have used the ones for 2010/11. The outcome won’t be exact, but it will give you the general idea.)

That earner would be paying £7,480 in income tax and a further £4,198 in national insurance, leaving an income of £32,197. The family would receive no tax credits, due to their income, but would receive £23 a week in child benefit, or £1,196 per year.

That family’s total net income would be £33,393 per year, or £642 per week. 60% of that is £385 per week. Remember that “poverty line” of £379 per week? That was defined as 60% of median income. But that family, with one earner nudging the 40% tax bracket, is at almost exactly the median income!

If you have two kids and only one of you is working, you need to earn two thirds of the higher rate tax bracket in order to avoid “poverty”.

What was that the BBC guy was saying? Poverty means not being able to take part in society because you don’t have enough money? What was he smoking?

There’s more, I’m afraid. That target was to eliminate child poverty by 2020. “Eliminate”, note, not even just “reduce”. That means, effectively, giving enough benefits to people out of work to take their income up to nearly two thirds of the 40% tax bracket.

But it’s even worse than that. If you did give those benefits, the median household income would magically rise, moving the target further out of reach and forcing even higher benefits.

Alternatively, of course, you could reduce the incomes of better off people by increased taxes, bringing down the median. This is indeed what the government is doing. That strategy means that you are reducing child poverty by making better off people poorer, without helping “the poor” at all.

These targets are absolute junk. As such, they are fully worthy of a New Labour clone like Mr Milburn, and indeed of the Tory Prime Minister who appointed him. A plague on all of them, and on their mates in the BBC.

The Riots – Iain Duncan Smith Is Tackling the Causes

 

Discussing welfare reform with Sainsbury's staff
Image by the Prime Minister's Office via Flickr

Iain Duncan Smith Discusses Welfare Reform with Sainsbury’s Staff

The BBC today reports a study by the LSE for the Guardian newspaper into the summer riots.

The study interviewed 270 rioters to try and understand why they took part in the rioting.

Their conclusion is that it was above all “anger at the police” that drove the rioters.

Of the 270 people interviewed, 85% said policing was an “important” or “very important” factor in why the riots happened.

They repeatedly expressed frustrations about their daily interactions with the police, saying that they felt hassled, bullied and complaining that they were not treated as equals.

Seventy per cent of the rioters said they had been stopped and searched in the last year.

And time and again interviewees described the violence as a chance to get back at the police.

Well, if 70% of the sort of people who get involved in riots were stopped and searched during the previous year, it seems at least that the police stop and search is targetting the right people. Is it really surprising that the sort of people who are happy to smash shop windows and loot the contents have little respect for the police?

It is, I suppose, also not surprising that the Guardian would seek to blame rioting on the police. The BBC article duly drones on about “police tactics”.

The results of this survey actually go much deeper than that.

The police are a symbol of the society in which the rioters live. The rioters are, in fact, alienated from the whole of society, and not just from the police. At the time of the riots, well-meaning chattering class types spent a lot of time wondering why anyone would choose to smash up their own communities. I suspect the people involved actually do not think of those places as “their” communities, any more than they think of the police as “their” police – as people in more peaceful kinds of places normally do.

The reasons for the alienation are many, and go back ultimately to what the Prime Minister has described as our “broken society”.

The dynamic is one of broken homes, families without fathers, and a culture of welfare entitlement. The latter goes with the rest of it. In normal societies, people see a link between work, income and providing for your family and yourself. Never mind if you are “only” a shelf stacker at Tesco – if that job provides the money that feeds your kids, then your life has a worth and value, and you can derive a pride and a place in society from that.

Socialists will say that there are no jobs. The truth is different. Companies cannot get the employees they need, and sometimes prefer immigrants to local people. Why? Because the local people have the wrong attitude. They don’t really want those jobs. Why not? Because in their minds, there is no connection between the obtaining of possessions including necessities like food, and working. Food is a right; a job is just an alternative way of obtaining it.

If all material possessions come from State handouts by entitlement, then the connection between obtaining those things and working for them is broken, and one of the bonds that hold families together is broken.

If a father (or indeed a mother) is not responsible for the material well-being of their children, because the State provides, then one of their key roles in the family is removed – indeed, one of the purposes of the family itself is removed. The State has then usurped the role of the family, but carries out that role without any love or personal involvement, according to bureaucratic processes and forms.

In turn, fathers especially become irrelevant – mothers supply love and the State supplies money. That’s fine – until the kids grow up and notice that the people who do work have more than they do.

If all that you have comes from a State handout, it is easy to believe that possessions and material wealth are an entitlement rather than something to be earned. If you then see other people who have much more than you, you will see that as unfair. You will not imagine that those other people’s material well-being came from working for it; you will believe it came from an unfair decision to award those other people extra that you don’t have.

And then the problem spreads out. Those from better backgrounds see “welfare scroungers” getting handouts from the State, while they, who work for a living, get none and pay high taxes to boot. They too get the message that society is unfair, that there is no connection between the work they do and the possessions they have or even their ability to obtain the necessities of life.

In turn, their commitment to the rules that bind us together as a society is weakened. They may even find themselves deciding that if those scroungers have big-screen televisions – whether through rioting or otherwise – well then, they who work should certainly have the same.

Finally, of course, one of the prime functions of the police is to protect property, and to protect society in general. If society is unfair, and the possession of property is allocated at random, then the police automatically become an agent perpetuating the unfairness.

This problem is not a policing problem. It goes much, much deeper. We have a very nasty underclass, especially in our inner cities, for whom society and community mean nothing. That is not their fault. They have grown up amidst the wreckage caused by the decline of morals, religion, the family and everything that holds our society together. But the root cause, the very root cause, is the welfare state itself. For too many people, it has destroyed the link between work and material possessions, destroyed the family and destroyed the bonds that hold communities together.

It is easy to be pessimistic, to give up and say that our society is in terminal decline, as many on the Right do. It is also easy, as the Guardian and many on the Left often do, to go for glib and quick answers like blaming police tactics.

Neither of those has much appeal for me. Let’s at least try and sort this mess out. We need to get the Left to understand that their welfare state has caused these problems. We also need to get the Right to understand that simply writing off the underclass, and using force to keep them under control, is a recipe for ultimate collapse.

I do not belong to his Party, or even support it, but listening to Iain Duncan Smith in many interviews, I believe he understands what needs to be done, and is trying to make a start doing it.

His welfare reforms will not tackle the hard core of disaffected youth who took part in those riots. But they will start to nibble away at the margin, at the edges of the problem, encouraging people on the edge of worklessness to get out and work – and ultimately it is the concept that people need to work for a living that will stop future riots.

It is a bit like “no tolerance” policing. If you always tackle minor crimes like vandalism, you end up with less murder and armed robbery. Similarly, if you can nudge a few people to get out and work who would otherwise be on the dole, the core problem will diminish. It is social pressure to work that gets people to work instead of scrounge; the more people are out at work, the greater that social pressure will be.

In future, the government (of whichever party) will need to build on Mr Duncan Smith’s plans and go much further. The Guardian will not like that, and they will rant against it, but it is the only way to put things back together again. “Making work pay” has been a slogan of both parties for years – but truly making work pay actually means making not working not pay. And that is the hard part.

We should therefore support those reforms. Sure, there is a much simpler way to do the means testing, via the tax system, and the civil service petty turf wars between the Deopartment for Work and Pensions and HMRC stop that even being considered. Sure, as a result of that, Mr Duncan Smith’s civil servants have told him they need a massive new IT system to implement the reforms. But the reforms are the first attempt since the War to do what needs to be done.

Mr Duncan Smith is in the front line, fighting against the greatest problem of our age – greater even than the government deficit. We should be in the trench beside him.