{"id":1402,"date":"2024-03-07T15:14:43","date_gmt":"2024-03-07T15:14:43","guid":{"rendered":"https:\/\/jpit.uk\/?p=22166"},"modified":"2024-03-07T15:14:43","modified_gmt":"2024-03-07T15:14:43","slug":"the-budget-a-masterclass-in-ignoring-poverty","status":"publish","type":"post","link":"https:\/\/standrewsurcrustington.org.uk\/?p=1402","title":{"rendered":"The Budget: a masterclass in ignoring poverty"},"content":{"rendered":"
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The headline measure in the Budget was a 2p cut in National Insurance. This gives the bottom fifth of earners around \u00a3350m a year, however the top fifth of earners will receive over 10 times more \u2013 more than \u00a34Bn<\/a>. This tax cut costs \u00a310Bn a year and is the largest financial decision in the budget by a huge margin. It also represents a long-term choice to target resources on the wealthiest households rather than those with the least. While churches are seeing the consequences of rising and deepening poverty in communities across the country. that is the wrong choice.<\/p>\n

Poverty, what poverty?<\/h2>\n

The word poverty was only mentioned once in the Chancellor\u2019s Speech<\/a> (and not at all by the Leader of the Opposition). The Chancellor told us that poverty was falling. This is correct if you choose to look at only one, increasingly outdated, measure[1]<\/a>. If the Chancellor had instead heeded the National Statistician\u2019s repeated warnings<\/a>, he would have looked at the many other measures the Government collects<\/a> and found that poverty is rising in every single other one.<\/p>\n

Using one carefully selected and flawed statistic the Chancellor dismissed the fact that relative poverty has risen to 14.4 million people<\/a>; that the Joseph Rowntree Foundation has found that 3.8 million individuals are now living in destitution<\/a>, up from one million a decade ago; that Trussell Trust foodbanks provide a food parcel every 8 seconds; that Citizens Advice had found that 5 million people are now in \u201cnegative budget\u201d<\/a> where they must go deeper into debt simply to afford the very basics. I could go on.<\/p>\n

Perhaps the most damning figure is that one million children experience destitution each year \u2013 unthinkable a decade ago \u2013 but this did not warrant a mention in the Budget. Local church, charity and community leaders are crying out that they are seeing increasing poverty, and we can see it as we walk through our towns and cities. Denial is not credible, but it is convenient.<\/p>\n

Choices around household incomes<\/h2>\n

The biggest choice the Chancellor made \u2013 which was supported by the Opposition \u2013 was to cut employee National Insurance contributions by 2p. This costs around \u00a310Bn, 42% of which will go to the wealthiest fifth of households<\/a>, while only 3% will go to the least well-off fifth.<\/p>\n

Today five out of every six households receiving Universal Credit are going without essentials<\/a>. The six-month extension of the Household Support Fund, which provides funds to councils to help families struggling to meet their basic needs, is welcome, but it is a temporary measure that barely touches the sides of the problem. A decent social security system would at the very least ensure that everyone was able to afford the essentials.<\/p>\n

For context, another choice could be to invest half of the NI cut, \u00a35Bn, in raising the Universal Credit standard allowance<\/a>. This would instead focus money on the lower end of the income spectrum and move around 350,000 people out of poverty. Even a quarter of that amount, \u00a32.5Bn, could cover the costs of ending the two-child rule<\/a>, which denies some benefits to the third and later children in a family, and would lift 490,000 children out of poverty.<\/p>\n

The other large tax cuts, the fuel duty (\u00a33Bn) and especially the increase in child benefit payments to families where someone earns \u00a350,000 to \u00a380,000 (\u00a30.5Bn) also focus money on those higher up the income spectrum.<\/p>\n

It is important to recognise that once \u2018fiscal headroom\u2019 \u2013 i.e. more money \u2013 is found in the Budget, it is a choice how to spend it. However, if the premise is that poverty is not growing, and it is not a political priority, then the choices made will not address poverty. If poverty is to be addressed, we need to make it a priority that politicians of no party can ignore.<\/p>\n

Choices around public services<\/h2>\n

In real terms spending on public services per person is set to fall by around 7%. For the protected departments (including health and social care) spending stays flat \u2013 a challenge given an ageing society alongside rapidly increasing mental health needs. For non-protected departments the cut is around 18%. These are figures on a par with the cuts made in the austerity years of 2010 to 2015, but this time the cuts will be applied to public services that have been though one round of austerity followed by a pandemic.<\/p>\n

This is the context of the Chancellor\u2019s announcement of an \u201cefficiency drive\u201d. It may work, and certainly support for modernisation will be useful, but past attempts at increasing efficiency suggests some scepticism is warranted.<\/p>\n

It is worth noting that the two lines of spending to boost efficiency are:<\/p>\n