The Liberal Democrats have announced two major policy initiatives designed to help with wealth inequality. One is to make available £10,000 over a person’s working life for training. The other is to pay for 35 hours of free child care per week for children once they reach nine months of age. Both are highly-targeted. Both are likely to make big differences.
Both Labour and the Conservatives have been making big promises, as if they have suddenly found the proverbial “magic money tree”. That would be rash at the best of times, and is doubly so when we are facing real strains over climate change, and self-inflicted ones if Brexit happens.
But there are real problems of wealth inequality in our society. These policies --- like pushing the Tories to agree to an increase in the basic tax allowance to £10,000 when we were in coalition --- are highly-targeted ones to reach real bite points.
For people with access to money, childcare is practical, and training can happen when needed. But for many others, having a child means a parent drops out of work, because they are not earning more than the cost of child care, and then struggle to re-enter work. This is a particularly serious concern because there’s a lot of evidence that people who spend their first five years in poverty are much more likely to face poverty for the rest of their life. Early intervention can make a huge difference.
In a world that is rapidly changing, people without the money to pay for further training easily find themselves trapped in dead-end jobs or out of work. This is a crippling inequality. A little money to help with the cost of training is a way out of this.
Both of these policies hold the promise of making a big difference. They are also likely to pay for themselves because they are likely to lead to people earning more (and being able to pay more tax). They are examples of policies targeted to make a big difference to people’s life chances, without imposing an unrealistic burden on public finance.