Five tests for Cameron on delivering real social justice

By Tim Montgomerie

Yesterday ConHome reported that David Cameron is to launch a 'Big Society Bank' that will invest in start-up and other community groups.

Today, in Liverpool, he will unpack more of the policy ideas through which he will build his vision of a 'Big Society'. Two of the ideas trailed in the Daily Mail are direct from the Centre for Social Justice. They are (1) a right for community groups to bid to run local assets and public services and (2) the idea of 'bureaucracy busters' to help local community overcome suffocating red tape.

The Coalition has made a good start in delivering a compassionate policy agenda. The Budget took most from those most able to pay to clear up Labour's mess. Michael Gove is introducing a premium payment for the poorest pupils. The state pension to earnings link will be restored. Andrew Mitchell has made a good start in ensuring the UK international aid budget is more transparent and more focused on the world's poorest nations.

But only through radical reform will the Coalition succeed in beating poverty. Throughout the Labour years the deepest forms of poverty grew. A radical departure from Labour's approach is needed. I suggest the Coalition has to pass at least five key tests in this Parliament:

1. Elimination of the work penalty. On Friday there were reports that Iain Duncan Smith was drafting a '40p guarantee'. This guarantee would mean that those on welfare were 40p in the £ better off if they took work. This will be easier to afford if George Osborne is willing to lift the ringfence on some 'wealthy welfare payments'.
2. Elimination of the couple penalty. Despite being in the Coalition Agreement, ConHome sources say that a marriage tax allowance is off the agenda because of pressure from the Liberal Democrats. Further proof of 'The Law of The Coalition'. Progress can and should still be made on eliminating the so-called couple penalty that means lower income parents are worse off if they live together.
3. A new generation of schools. Education alongside work and family is the best route out of poverty. Too many schools in the most disadvantaged areas are simply not good enough. Allowing the best schools to have the freedoms of Academy status and allowing parents, faith groups and social entrepreneurs to set up new schools will break the local education authorities' stranglehold of all education in an area. We need schools that sack incompetent teachers and use exams that employers can have confidence in.
4. Charities that are free from state ideology. Too many voluntary groups have become too close to the state. Britain is full of childrens' charities that refuse to recognise the two parent family as an ideal, for example, aid charities that oppose free trade and homelessness charities that take a relaxed view of alcohol and drug dependency. Nick Hurd, Charities Minister, must reform the way charities are funded so that charities increasingly receive taxpayers' money via vouchers and only when they have the proven confidence of their communities (eg by having raised money locally).
5. A global free trade policy. Although aid is an important part of a global justice policy it can only ever play a supporting role. More important is free trade. Cameron should make reducing protectionism a central part of his foreign policy - giving a big hitter the role of restarting global trade talks and representing Britain in them. I'd give the job to David Davis.