The Brethren* are pouring out reports, analyses, and policy documents on an almost daily basis at the moment. And this is no bad thing if you’re a blogger looking for something to write about. They’re, quite correctly, taking the threats posed by the Spending Review very seriously.
Today is no exception to that. And an important piece of analysis it is. This one shows that almost two-thirds of the welfare and benefit cuts – totalling £15.9 billion so far – will hit working families. That’s in contradiction to the Government’s claim that they are ‘making work pay’.
The analysis shows that working households will suffer a loss of around £9.4 billion, compared to £5.9 billion for non-working households. 69 per cent of the policies in the spending review alone hit working households, at a cost of £4.5 billion.
That’s because most of welfare cuts for working age people relate to benefits for children so working families are taking the brunt of the cuts. This detail comes right behind data that showed that departmental spending cuts will hit the poorest households 15 times harder than the richest 10 per cent, as well as analysis from the IFS which found the tax and benefit changes announced in the spending review and emergency budget were regressive and not progressive.
Housing benefit cuts are hitting low-income households hardest and more than half of all poor children living in working households mean that targeting those working households is likely to increase child poverty.
This comes on top of increases in the rate at which tax credits are withdrawn and reductions in childcare elements of working tax credit. These combinations act as a huge disincentive for low-income households to work more hours or gain a second income, and contradict George Osborne’s stated aim of ‘making work pay’.
Despite all the coalition cries of fairness and necessity, the government are already losing that argument. The government may claim they are forcing alleged work-shy scroungers back to work, but it is working families, both poor and the ‘squeezed middle’, who are the biggest losers from the spending cuts.
Neither of the coalition parties had such deep and rapid cuts in their election manifestoes and, as such, have very little mandate for carrying them through. The scale of the cuts announced is nothing but a political and ideological choice which nobody in the country has voted for.
Nobody voted for lower living standards. Nobody voted for higher child poverty. Nobody voted for unparalleled job losses. And nobody voted for banks and big business to be let off payment of taxes which would support our economy. Team Cameron need to review their plans before the damage they do becomes irreparable. But they won’t.
*The Brethren are of course my brother (and sister) trades unionists. This is as compared to The Comrades who are my fellow members of the Labour Party. These names are meant with (at least a touch of) affection and are a habit I picked up from my mate Smithsky. We are both members of the Brethren and the Comrades, and can call them what we like.