Mother Courage and Her Children (Merthyr Tydfil Labour Club)

Mother Courage is the original 50p woman and John E McGrath's production never lets you forget it. Her cart is a metal train of shopping trolleys, full of low-budget essentials, and she pushes it through war-torn Europe, selling budget goods to the desperate and the destitute. She has no livelihood without war and, though it costs her her three children, she depends on its fallout, just as Smoggy relies on recession. When peace breaks out, Mother Courage's customers all get their own trolley. After austerity, Smoggy's will shop for themselves.

McGrath's production is smartly conceived. We're in Merthyr Tydfil, once ranked the third worst place to live in Britain, a town still haunted by the closure of its coal mines and ironworks 30 years ago. Last month, it got its own Channel 4 doc, Skint. Historically, industrial demand always meant its fortunes revived during wartime, though post-World War Two light industry took over and the town's women became its breadwinners.

'Morgan's Mother Courage herds both her trolleys and her children – but the trolleys always come first'

An all-female cast take over Merthyr's no-frills Labour Club for a knockabout, makeshift staging. Bertholt Brecht's songs are belted out as karaoke numbers; their lyrics running alongside the action just as Brecht would have wanted. A community chorus of Labour Club members join in now and then. Peter the Cook (Sara McGaughey) sets up his kitchen behind the bar and the General's office is thrown together from the local am-dram society's props.

In the middle of all this, Rhian Morgan's Mother Courage herds both her trolleys and her children – but the trolleys always come first. Her face is pursed with resolve, like someone battling through heavy weather, but Morgan doesn't really explore her extremities: the one-woman community centre against the exploitative businesswoman. She's never the "hyena of the battlefield" of John Willett's translation, nor much of a mother either. All that remains is her grit. "When you're poor," she says, "you've no choice but to have courage."

However, the equation of war and austerity undermines the play's power, as does the grab-what-you-can staging. Massive moments – Mother Courage's unflinching response to her own son's corpse; her mute daughter Kattrin's rape and disfigurement – get nowhere near the horror they portray and McGrath hides behind the cool detachment of Brechtian theory. Television screens draw glib contemporary parallels, from Who Wants to Be a Millionaire to news reports from Iraq, but the real relevance is in the setting itself.

Mother Courage and Her Children runs at Merthyr Tydfil Labour Club until 22 May