The Politics of the Price of Bread
This week I took part in a Radio 4 programme called The Long View. It was looking at one of the first welfare schemes that was developed in 1795 in a pub called the Pelican in what was then the rural village of Speenhamland. The programme looked at what became known across the country as the Speenhamland System and its relevance to today's debate on welfare. The system was developed to address the needs of the rural poor. It was a well intentioned but ultimately unsuccessful attempt to supplement their incomes. Payments provided by local ratepayers were triggered by rise in the price of bread. Its failures are mirrored in today's debate on the minimum wage. The debate centres on the belief that the level at which tax credits are set has allowed some employers to pay lower than they should because those on low incomes can be supported by the tax payer through the tax credit system. This in part is the reason George Osborne has asked the Low Pay Commission to look at a rise in the minimum wage.
1795 was not the last time the price of a loaf of bread entered the political fray in the Newbury constituency. In the 1906 election the Conservative MP William Mount, was ousted by a Liberal, Frederick Mackaness. This was the election that saw so called Tariff Reformers like Mount, who were protectionists, taken to the electoral cleaners by free traders. Mackaness put out a leaflet in Newbury which claimed, "Mr Mount wants you to pay more for bread". It worked. A safe seat was lost – only to be regained by the Conservatives a few years later (as it was again 99 years on). This is relevant today because that leaflet sits in William Mount's great-great grandson’s desk in 10 Downing Street. David Cameron told me he keeps it there to remind him of the importance of free trade. It is important to remember that free trade protects the incomes of the poorest. I’m sure that leaflet is also a reminder of the political price to be paid by those who oppose free trade.