At the Conservative Party Conference, Work and Pensions Secretary Iain Duncan Smith announced that the government is to introduce pre-paid benefit cards. The idea is that those who currently have their benefits paid into a bank account should instead be issued with a plastic card pre-loaded with an amount of money to spend on essential items. The Minister said that the cards would help those “on the margins break the cycle of poverty” by stopping claimants spending their money on alcohol, drugs or gambling habits.
The system has already been piloted, so we can predict what effects it will have. The cards are known as Azure Cards. The government issues them to people who have been refused asylum in the UK, but for whatever reason can’t go back to their country of origin – like my friend Jamyang.
Jamyang was born in Tibet, and that’s where she would like to live. She would desperately like to see her husband and especially her young children, who she hasn’t seen for six years. But she can’t. She fled Tibet when her life was threatened, for reasons that I won’t go into here, but that would make you weep if I did. She’s currently living in Manchester. Jamyang is the only sanctuary-seeker I know who finds Manchester a bit warm for her taste!
Jamyang asked for asylum in the UK, but she was refused. The government believes that she ought to go home to Tibet. At the same time, it knows that she can’t do that, because she doesn’t have a passport and the Chinese government won’t issue one. So, until something changes, she is stuck in Manchester. She’s not breaking the law by being here, but nor does she have a right to remain here. There’s simply nothing else she can do. People who find themselves in this situation are sometimes called “ghosts.”
Fortunately, if you find yourself in this situation the Borders Agency provides you with a minimal level of support. Jamyang has the use of a room in a house with several other asylum seekers. Invariably the houses allocated to ghosts are those that couldn’t be let to paying tenants. Jamyang’s house is in a shocking condition, and it is located on a council estate several miles outside Manchester, where the other residents are less than welcoming to their international neighbours.
The Borders Agency also provides Jamyang with an Azure Card. This card is automatically topped-up with £35.39 every Monday. It only works in a very limited range of shops, and you can only use it to buy food, essential toiletries, clothes and credit for a mobile phone. But it’s a good test for Iain Duncan Smith’s new benefits card. We already know it is impractical, demeaning and draconian.
For a start, you can only use the card in a small (and decreasing) number of shops. They work in the bigger branches of Asda and Tesco, but not the local ones. If you live a long way from a shop that takes the card, tough. You will have to walk there and back with your shopping. If you have young children the journey may be next to impossible.
Of course you might want to get a bus. Transport is vital for benefit claimants, not just to get to the shops they are allowed to use, but also to get access to training or to job interviews. But you can’t buy a bus pass with an Azure Card.
When you turn up at a shop with an Azure Card the reception you get will vary. Some shop assistants are helpful, but many others don’t recognise the card and some are downright rude. Your card announces to the checkout queue that you are a failed asylum seeker. Cards also have a history of failing to register at the till, which is not just embarrassing but disastrous if you have no other means of buying food.
It’s hard to shop with a card when you have a fixed amount to spend. Asylum seekers, many of whom are working in a second or third language, have to go round the store adding up the price of their shopping to try to get as close as possible to £35.39 without going over the limit. If your bill comes to more than you have left on the card it is simply rejected. It doesn’t tell you how much you have on the card, or by how much you have overspent. It just won’t work. The same happens if you have accidentally picked up an item that isn’t on the government’s approved list – a battery, say, or a birthday card, or a pack of Asprin – all banned. Again, there’s no indication of what you’ve got wrong. The card is just rejected. Imagine how it feels to resolve that with an unsympathetic checkout attendant, a hungry child and a long queue behind you.
It is true that benefits cards can’t be used for gambling, or to buy cigarettes or alcohol. But those aren’t the only things you can’t buy. For instance, you can’t get a haircut with an Azure Card. You can’t buy fresh fruit and veg from a market stall. You can’t use an Azure card in a launderette. You can’t buy a child an ice cream or pay for their school trip. You can’t use the card to pay for gas or electricity. You can’t use the card to buy second-hand clothes in most charity shops. You can’t use it in a pay-phone. You can’t give to charity with a card, or help a friend or family member who is short of money – which is an essential feature of the economy of the poorest areas of Britain. The card is re-set every Monday, with a maximum of £5 held over from the previous week. If you haven’t spent the money for whatever reason you lose it. So there’s no possibility of saving for Christmas, or for a warm coat. There are lots of things you can’t buy with a benefit card, and they tend to be the things that offer a person dignity, a place in the community and a route out of poverty.
Perhaps the greatest indignity is that the government is able to limit what users can buy with their cards, and also to record what, when and where they buy it. Of course this is information that anyone with a loyalty card already gives to the supermarkets. But to make that information available to the government is a significant and worrying step. In future, someone in Whitehall will be able to determine that you bought sanitary products, or fresh bread or baked beans. At future Party Conferences I have no doubt that ministers will announce gleefully that they benefits claimants have had the temerity to buy this or that product at the public’s expense.
It comes as no surprise that the government has contracted out the management of the system. The Azure card is administered by the French company Sodexo, a highly successful company with worldwide interests and an annual revenue north of £1 billion. In the UK Sodexo provides a range of services to the government, from private prisons to catering at government offices. The scheme is run in conjunction with a small number of retailers, who take a percentage of the value of the cards in exchange for the guarantee of custom. So in effect, the government is getting a discount on its benefits bill, as it distributes its favours to those major retailers who agree to cooperate.
Whether it comes in cash or on a card, to some people, the government’s support for Jamyang might seem very generous. She certainly thinks so, and she is genuinely grateful for what she gets. After all, she doesn’t contribute much to the UK economy. She would like to earn money, but is not allowed to work and doesn’t want to sell sex. The idea that if she were given cash she would spend it on cigarettes, alcohol or gambling is simply ridiculous. She cheerfully volunteers all over the place, cooks and cleans for friends without charge and is studying to improve her English. Jamyang is irrepressibly smiley in the face of the greatest insecurity and indignity that I can imagine – the loss of her home, her family and her future. We know this because every week we drive her to the supermarket and do our weekly shop with her. Jamyang pays for it with her Azure card, and we give her the equivalent in cash to spend or save as she wishes. We owe her nothing less.
The extension of pre-paid cards to everyone who claims benefits is about far more than just stopping people from buying cigarettes or alcohol. It is a conscious move to control the behaviour of welfare claimants, to shame and degrade them, presumably in the hope that if receiving state support can be made sufficiently awful, people will prefer to work. In fact, the reverse is true. If you degrade and dehumanise people sufficiently, you don’t incentivise them to work. You’re more likely to undermine them so much that they are unable to function effectively at all.
A petition to oppose the introduction of benefit cards has been started at https://you.38degrees.org.uk/petitions/re-think-pre-paid-benefit-cards?bucket=blast