I was lucky. Last week, I was cycling downhill when I hit a pothole. The front wheel folded into an infinity symbol. I went over the handlebars and, with no time to put my hands out, landed on my face. My helmet and glasses took most of the impact. I emerged, remarkably, with just a few cuts and bruises.
My glasses were banjaxed, my bike needed major repairs and my clothes were torn. Altogether, that pothole has cost me about £450. Again, I’m lucky – I can afford it. But the point is this: fixing a pothole costs us between £45 and £90. Not fixing it costs us far more. God knows how many other people have pranged their bikes or wrecked their car tyres in the same hole. Between us, we may have paid hundreds of times the cost of its repair. If people have suffered significant injuries, so must the NHS. One of my correspondents tells me: “I’m three months into recovery from a cycling accident with a pothole that left me being airlifted to hospital with potentially life-threatening injuries. As well as a brain haemorrhage (despite a helmet), I had numerous broken bones and can’t yet walk without crutches.” The cost to the health service must be huge; the cost to him incalculable.
Austerity – which leaves our potholes, alongside many other gaps in public provision, unfilled – does not save money. On the contrary, it costs us a fortune. What the rich might save in taxes, the rest must pay over and over again.
False economies abound. For example, the government may at last be persuaded to remove the Tories’ vicious, Malthusian two-child benefit cap. But what many people have failed to grasp is that behind it stands another brick wall: the household benefits cap. If families now receive money for a third child, it could push them past the household limit, and they’ll be scarcely better off than before. This household cap has extreme and perverse consequences. It ensures that rents, even in the social sector, are almost everywhere unaffordable to the families affected, most of which are headed by lone parents. The result is that they are thrown into temporary accommodation, which local authorities must provide at far greater expense: roughly £2.3bn a year. Being forced into temporary accommodation also curtails adults’ employment opportunities and children’s performance at school, and generates great suffering, which can translate into physical and mental health problems, which of course means further economic impacts.
In 2019, a parliamentary committee called on the government to “conduct a full cost benefit analysis of the benefit cap”. The government rejected the call, but said it would explore the possibility in future. I checked with the Department for Work and Pensions – it still hasn’t happened.
Keeping people in poverty is an expensive luxury. Poverty persists in rich countries because governments have made a political choice to keep people poor. This choice is driven by two imperatives. The first is a deep, ancient and irrational belief that poverty is a vice that must be punished. The second is the bosses’ need to keep us in a state of fear, so that people continue to perform stressful and demeaning work for lousy pay.
Or take adult social care. Around 2 million elderly people are not receiving the care they need. Many younger adults who could work if they had sufficient care are unable to do so. Some 2.6 million people, mostly women, have given up paid work to care for family members, as there are no good alternatives. They lose an average of £5,800 in annual earnings, a vast aggregate cost to the country.
Insufficient care drives many people into the arms of the NHS: at any one time, 13% of NHS beds are occupied by people waiting for social care support. Proper funding would provide a major economic boost, as good care requires a large workforce. According to the Future Social Care Coalition, for every £1 invested in social care work, £1.75 is generated in the wider economy. But, as a parliamentary inquiry found, evidence of the costs of failing to provide sufficient care “is scandalously scant or even absent from decision making”. The government counts the costs of provision, but not the costs of non-provision.
The shortfall in government funding for social care has caused a financial crisis in almost every local authority. Other services are being cut to the bone. The potholes crisis, in other words, is a direct result of the social care crisis. In any exploration of the costs and benefits of social care spending, you could include the price of people being airlifted to hospital because the roads are falling apart.
Of course, we should be wary of reducing everything to a cost-benefit analysis: many forms of necessary spending will carry a net cost to the exchequer, which is the price we pay for living in a kind and decent society. But this should not prevent us from remarking on the utter perversity of counting only the costs of state spending, while ignoring the benefits.
The government, using a definition that means nothing to people falling into potholes, or into temporary accommodation, or into debt, insists austerity has ended, as there has been a slight, albeit temporary rise in public spending as a percentage of GDP. But when it leaves so many essential services underfunded, the technical definition becomes a sophisticated lie. A more honest definition of austerity is a decline in services caused by a shortfall in funding.
after newsletter promotion
The bill for a crisis caused by the ultra-rich – the 2008 bank crash and the vast state bailout it triggered – has been handed to the poor. But that’s neither necessary nor inevitable. If Labour chose, next month’s budget could put us on an entirely different course, one in which we need not suffer smashed glasses, mangled bikes, broken bones, evictions, poverty and neglect, to allow the ultra-rich their private jets, powerboats, beauty spas and second, third or fourth homes. Either they carry the cost, through income tax, wealth tax and a much fairer council tax or property tax banding system, or everyone else carries a much higher one.
There would be a cost – a political cost – for the government in confronting the massive infrastructure of persuasion the very rich have built, and ending our 14-year sentence of austerity. But the cost of failing to do so, for all of us, is so much higher.
Leave a Reply