Our columnist ANDREW FISHER on the Chancellor’s Spring Statement and the impact it could have on Croydon
Last week, Labour announced it would cut £5billion from the social security benefits that disabled people receive. In the Orwellian, anti-truth language now universal in politics, this was presented as helping more disabled people back into work.
Previously, the Conservatives attempted to cut support for disabled people, using the same rhetoric about “supporting” more disabled people into work.
Bleak budget: Rachel Reeves on her way from No11 Downing Street yesterday
A High Court challenge to their plans – brought by my recent podcast interviewee, Ellen Clifford – revealed that, of the 457,000 people who would have their benefits cut, only 15,000 were expected to enter employment. And that was according to the Department for Work and Pensions’ own figures.
Alongside Chancellor Rachel Reeves’ Spring Statement, yesterday the DWP published an analysis of Labour’s plans which revealed that 3million families will lose out from the changes to Universal Credit and 800,000 will lose Personal Independence Payments, with an average loss of £4,500 a year.
The government’s own impact assessment showed there will be a knock-on cut of £500million in carers’ benefits by 2029-2030, as “a further 150,000 people will not receive Carers’ Allowance or the UC Carer Element as a result”.
If that sounds bad, it might be even worse according to the Joseph Rowntree Foundation, the anti-poverty charity. They said “the DWP is using a sleight of hand in its disability benefit cuts impact assessment: actual increase in poverty is closer to 400,000, not the 250,000 in the impact assessment”.
This is because the DWP analysis included a Conservative policy change that was never implemented – which would have sent 150,000 into poverty. But the DWP offset this against the net impact of Labour’s new policy which actually sends 400,000 people into poverty
The Department estimates there will “be an additional 250,000 people (including 50,000 children) in relative poverty after housing costs in 2029-30 as a result of modelled changes to social security, compared to the baseline projections”.
The impact of these cuts – aligned with the decision to freeze housing allowance at the Budget last year – is likely to fall on already hard-pressed local councils, with more demand for social care and emergency accommodation, and on the NHS: with more poverty always comes more illness – physical and mental.
A matter of life and death: there were protests outside Parliament over anticipated cuts in benefits
Labour ministers have been arguing that the effects will be mitigated by more disabled people moving into work.
The problem with this is that neither the DWP nor the Office for Budget Responsibility can produce a shred of evidence to back it.
It is worth remembering that PIP is paid to disabled people to cover their additional living costs, and many PIP claimants are already in work. Taking it away from 800,000 perversely risks forcing some out of the labour market, because they no longer receive the assistance that enables them to work.
The other problem with this talk of getting more disabled people into work is that the OBR has revised its forecast for unemployment up by 200,000 next year, and by 100,000 the year after. At a time when unemployment is forecast to rise further, is it really likely that hundreds of thousands more disabled people, who in many cases have been assessed as having at best limited capacity to work, are going to find work?
Currently, there are six people looking for work for every job vacancy in Britain. The picture is even worse in London, where unemployment is now the worst in any nation or region of the UK at 6.1%, compared to the national average of 4.4%.
It is no surprise that there has been a backlash against these proposals – from disabled activists, disability charities, think-tanks, trade unions and even from inside the Labour Party, too
‘Unconscionable’: a Labour councillor in Lewisham has spoken out. There’s been silence from Labour in Croydon
The New Cross Gate Labour councillor Aisha Malik-Smith posted that the cuts to disability benefits were, “Unconscionable from a Labour government.”
It is likely that approximately 15,000 to 20,000 disabled people in Croydon will be affected by these changes – agonising for them, and it risks putting more strain on the borough’s services and taking thousands of pounds out of an already fragile local economy.
But to my knowledge, no Croydon Labour councillor has uttered a peep about the government’s proposals to send their constituents into poverty.
Debbie Abrahams, the Labour MP who chairs of the Commons’ work and pensions select committee, told Chancellor Reeves that her benefit cuts “will make people sicker and poorer”, while another Labour MP, Clive Lewis, told BBC Newsnight: “There are choices here and we’ve made the choice to cut and punch down on some of the poorest and most vulnerable.”
All three of Croydon’s Labour MPs have so far remained silent, despite this unease from their colleagues. The Croydon political culture of head down, do nothing, don’t say anything, flourishes while all else falters.
‘Sicker and poorer’: Labour MP Debbie Abrahams has criticised the Chancellor’s benefit proposals
The Resolution Foundation said their analysis “reveals that lower-income households are set to become £500 a year poorer over the Parliament”.
More bad news came as the OBR, a body established under the last Conservative government to assess independently Government economic policies, has halved its forecast for growth this year, from 2% to 1%.
At the election last year, Labour said its No1 mission was to “secure the highest sustained growth in the G7”. That’s going well then.
Rachel Reeves opened her in the Spring Statement speech by confirming there would be “no tax increases”. And nor were there.
Which means that rather than taxing the rich, a Labour Chancellor has chosen to balance the books on the backs of disabled people – and send 400,000 more into poverty.
It is “Change” as Labour promised at the General Election last year, just not how you might have thought …
- As well as his column, Andrew is also conducting podcast interviews, in-depth and informed with specialists and national figures, sharing their expertise with Croydon, and available on Inside Croydon’s Spotify channel
The Andrew Fisher Interview is usually available only to paid subscribers of Inside Croydon. This month’s podcast is with disability rights activist Ellen Clifford, and this episode is free to access to all our readers. - Click here to listen now to how cuts to benefits is a life or death issue
- From 2015 to 2019, Andrew Fisher was the Labour Party’s Director of Policy under Jeremy Corbyn. Fisher is also the author of The Failed Experiment – and how to build an economy that works, and now writes columns for InsideCroydon, the i newspaper and is a regular pundit on BBC and Sky News programmes
Andrew Fisher’s recent columns:
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- Government must act to end the chaos, austerity and decline
- If you have a news story about life in or around Croydon, or want to publicise your residents’ association or business, or if you have a local event to promote, please email us with full details at inside.croydon@btinternet.com
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Who thought it was a great idea to rule out tax rises before during and after the election is an idiot. Keep benefits as they were, maybe even index-link them and raise the top rate of tax for high earners back to, say,50% (55% for those on £125k plus) to balance the books (raising £4bn per year) pinned on the Tories for their pre-election splurge. Then a wealth tax to pay for the inevitable war effort at the Budget.
In 1944-45 there was a rate of tax of 98% on the highest incomes. Some may remember George Harrison singing ”It’s one for you, 19 for me” in ”Taxman”, complaining about the 95% tax rate in 1966. The current top rate of tax is 45%. The vast, rapidly increasing and historically largest disparity in wealth and income DEMANDS that a supposedly socialist party should be taxing the richest, not the poorest and most disadvantaged.