‘Quiet man’ was sick of being Osborne’s cash cow... now he is unchained

...WHO COMES TO PRAISE

THE Quiet Man has certainly picked his moment. Two days after a Budget that raided his Department and three months before an epoch-making referendum on Britain’s relationship with Europe, Iain Duncan Smith has sensationally quit the Cabinet as Welfare Secretary.

His departure certainly sets him free to campaign with all his might on an issue dear to his heart – a British departure from the stifling embrace of Brussels and an escape to a new beginning as an independent country, free once more to make its way in the world.

But that is not why IDS quit. He stepped down after nearly six years in one of the most punishing jobs in government because of profound disagreements with David Cameron and George Osborne about the pace and direction of his welfare reforms.

The difference between Duncan Smith and the Prime Minister and his Chancellor is clear and simple. The former sees reforming our £100billion-a-year welfare budget as a moral crusade. The men who run the Government, especially Osborne, see it as a way of saving precious cash.

IDS believes the people at the bottom of the pile need help to rebuild what are often shattered lives. Put bluntly, they are on the scrapheap because life has either dealt them a rotten hand or because they have made some terrible choices in the way they live.

Many are products of broken homes with feckless mothers and – if they have one – bullying or alcoholic fathers. They have been failed by sink schools, got themselves deep in debt and failed to hold down a job.

They have fallen prey to welfare dependency – the system that just about enables them to get by on state handouts and makes little attempt to encourage them to regain their self-respect and get themselves into work.

As the founder of the think-tank the Centre for Social Justice, IDS identified the five pathways to poverty, arguing that if we really wanted to help the bottom 20 per cent – and save taxpayers’ cash – we had to close these roads to ruin.

AT THE heart of this vision was restoring incentives to work. In seminal policy papers, the CSJ pointed out the horrendous disincentives to work for the poorest. Taking a job often meant that people were hardly better off than subsisting on welfare. This was because welfare benefits, such as the Jobseeker’s Allowance and housing benefit, were withdrawn at such a rapid rate when someone moved into a lowpaid job that they hardly noticed any uplift in their overall earnings.

His solution was universal credit – a new simplified benefits system – that is now being rolled out across the country. Under this system, benefits are withdrawn more slowly, meaning that by doing the right thing – finding work – the poorest in society see an improvement in their lives. Trouble was that Osborne, and to a lesser extent Cameron, did not see things the same way.

Osborne, in many ways a far more traditional and less visionary Tory than the Welfare Secretary, was much more concerned about counting the pennies. He also preferred to use old-time language, much of which resonated with the Conservative core vote. Shirkers were part of the Chancellor’s rhetoric as he tended to blame the poor for their lot rather than seek to rebuild their lives and put them on a route to recovery.

Over the six years IDS has been at the DWP, there have been countless rows between him and the Chancellor. Part of the reason was this difference in outlook and part, the Treasury’s distrust of IDS’s Department and the universal credit system, which relies on the latest internet technology. Nor did the Treasury like the idea of a strong Minister, who it could not control, running a Department seen as low in the pecking order.

The tensions between Osborne and IDS have been simmering for years. They came to a head last summer over the last Budget when the Chancellor drove through a plan for a £4.5billion cut in tax credits despite Duncan Smith’s opposition. Backbench Tory MPs put a stop to that but the whole thing blew up again before this Budget when the Chancellor sought to raid the DWP piggy bank, demanding an annual cut of £1billion in payments to the disabled.

IDS wanted a long-term review of the £17billion disability payments system but Osborne was insistent on an immediate slice of the action. Again, amazingly, the whole thing fell apart in his hands as Tory backbenchers, mindful that the Government has only an effective majority of 17, signalled that they would scupper the cutbacks. Of course, by then, IDS had had enough of being treated as the Government’s cash cow, quitting after several acrimonious meetings with Cameron.

Because Osborne and Cameron have ring-fenced large chunks of public spending, there is really only one high spending Department to go to when the money runs out – as it surely has this year.

POLITICAL factors also played a huge part in the IDS walkout. Cameron and Osborne are terrified of l osing the Brexit vote on June 23. To that end, Osborne decided on a Budget designed to please Middle England, effectively raiding benefits for the disabled to pay for a cut in income tax for the middle classes and no rise in petrol duty, despite falling oil prices.

The duopoly running the Government was determined to do nothing to upset Middle England in the run-up to the referendum for fear of losing their votes to those campaigning to leave the EU. Both men know that defeat in the vote will spell disaster for their careers, bringing Cameron down and denying Osborne his chance of entering No10. The stakes could not be higher.

They have always regarded IDS as a ticking time bomb. A former Guardsman, his public demeanour may be restrained. He is a throwback to an earlier time of conviction politics, epitomised by Margaret Thatcher on the Right and Michael Foot on the Left. He believes passionately in his mission to reform welfare and that Britain should regain its independence from foreign rule.

Iain Duncan Smith unchained will prove a formidable champion for that cause in the weeks to come.