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Osborne's comprehensive spending review puts society in intensive care Osborne's comprehensive spending review puts society in intensive care
(3 months later)
If you think Wednesday's spending review is eye-wateringly tough, you ain't seen nothing yet. For the two years following the next general election, George Osborne plans far deeper cuts once the voting is over, according to the Institute for Fiscal Studies. By then we will have suffered six long years of blood, sweat and tears – with a higher national debt, dwindling capital spending, falling living standards and galloping poverty. Promising two more years of even deeper cuts: is that what people will vote for, really?If you think Wednesday's spending review is eye-wateringly tough, you ain't seen nothing yet. For the two years following the next general election, George Osborne plans far deeper cuts once the voting is over, according to the Institute for Fiscal Studies. By then we will have suffered six long years of blood, sweat and tears – with a higher national debt, dwindling capital spending, falling living standards and galloping poverty. Promising two more years of even deeper cuts: is that what people will vote for, really?
The IMF predicts weak UK growth by 2015 – but whose "growth" will it be? As Resolution Foundation research shows, well over half the population has had zero growth since 2003 – and they won't be sharing it this time either. Average GDP is almost meaningless in a country this unequal: growth will again be sucked up by the few. FTSE CEOs paid themselves 10% more last year, £4m on average.The IMF predicts weak UK growth by 2015 – but whose "growth" will it be? As Resolution Foundation research shows, well over half the population has had zero growth since 2003 – and they won't be sharing it this time either. Average GDP is almost meaningless in a country this unequal: growth will again be sucked up by the few. FTSE CEOs paid themselves 10% more last year, £4m on average.
If George Osborne's party is re-elected, the IFS says his forward plans will mean a further £23bn cut for 2017 and 2018. This week's comprehensive spending review inflicts a 2.8% cut for 2015/16, but the following two years will gouge much deeper, at 7.6%. The cumulative effect is worse, each cut closer to the bone, to the very marrow. Will voters really embrace that prospect?If George Osborne's party is re-elected, the IFS says his forward plans will mean a further £23bn cut for 2017 and 2018. This week's comprehensive spending review inflicts a 2.8% cut for 2015/16, but the following two years will gouge much deeper, at 7.6%. The cumulative effect is worse, each cut closer to the bone, to the very marrow. Will voters really embrace that prospect?
In Conservative enclaves austerity is born with admirable equanimity. Cuts, what cuts? Dorset is almost untouched while Liverpool is hardest hit; the comfortable of Witney or Tatton need see nothing distressing. But should David Cameron and Osborne choose to discomfort themselves by venturing somewhere like Stoke, I recommend a couple of days with the social fund team, listening to the calls of the utterly desperate.In Conservative enclaves austerity is born with admirable equanimity. Cuts, what cuts? Dorset is almost untouched while Liverpool is hardest hit; the comfortable of Witney or Tatton need see nothing distressing. But should David Cameron and Osborne choose to discomfort themselves by venturing somewhere like Stoke, I recommend a couple of days with the social fund team, listening to the calls of the utterly desperate.
The social fund is the last resort, the final gasket that blows in the benefits system. Jobcentres did offer social fund loans or grants in an emergency, but in April that function moved to local councils to do as they please, un-ringfenced. The Children's Society finds they make randomly different provisions and conditions. In Stoke four experienced staff, sympathetic but canny, field some 50 calls a day from people at the end of their tether. Checking the caller's status on several data bases, they can hand out vouchers for food banks, open their own food cupboard, sometimes offer clothes or top up empty gas and electricity keys. Families needing nappies, milk or school uniform are sent to children's centres. "No, I'm sorry, we don't give out money or loans any more," begins almost every phone call. "No, I'm sorry, only food for three days". No, no bus money.The social fund is the last resort, the final gasket that blows in the benefits system. Jobcentres did offer social fund loans or grants in an emergency, but in April that function moved to local councils to do as they please, un-ringfenced. The Children's Society finds they make randomly different provisions and conditions. In Stoke four experienced staff, sympathetic but canny, field some 50 calls a day from people at the end of their tether. Checking the caller's status on several data bases, they can hand out vouchers for food banks, open their own food cupboard, sometimes offer clothes or top up empty gas and electricity keys. Families needing nappies, milk or school uniform are sent to children's centres. "No, I'm sorry, we don't give out money or loans any more," begins almost every phone call. "No, I'm sorry, only food for three days". No, no bus money.
Most callers have been referred from the jobcentre, an irony since most people's crises are caused by what the jobcentre has done to them. Errors delaying payments have left some starving. Many have been "sanctioned", with benefits stopped for weeks: a catastrophic punishment, often for trivial infringements – even the best reasons for a missed appointment are dismissed. This team sees letters demanding attendance that arrive after the appointment date, but people are still sanctioned. The Department for Work and Pensions denies the existence of quotas, but jobcentres are under intense pressure to cut people off, with league tables and threats to offices or staff who sanction too little. The DWP is delaying the publication of data on these new tougher sanctions – expected to be shocking.Most callers have been referred from the jobcentre, an irony since most people's crises are caused by what the jobcentre has done to them. Errors delaying payments have left some starving. Many have been "sanctioned", with benefits stopped for weeks: a catastrophic punishment, often for trivial infringements – even the best reasons for a missed appointment are dismissed. This team sees letters demanding attendance that arrive after the appointment date, but people are still sanctioned. The Department for Work and Pensions denies the existence of quotas, but jobcentres are under intense pressure to cut people off, with league tables and threats to offices or staff who sanction too little. The DWP is delaying the publication of data on these new tougher sanctions – expected to be shocking.
All human misery is here. Some callers are in tears, some shout in frustration after a series of rebuffs, some plainly have mental health problems ignored by the sanctioners. Some are just out of prison, arriving with nothing at all, no change of clothes. One ex-army man suffering panic attacks has been sanctioned when he couldn't leave his home. Some have been on the streets: homelessness is rising in Stoke. How desperate can you be when you have nothing to feed your children and debt collectors are pressing? A man who went totally blind last year has been thrown off disability benefit for missing an appointment, his debts building as he has a spare room.All human misery is here. Some callers are in tears, some shout in frustration after a series of rebuffs, some plainly have mental health problems ignored by the sanctioners. Some are just out of prison, arriving with nothing at all, no change of clothes. One ex-army man suffering panic attacks has been sanctioned when he couldn't leave his home. Some have been on the streets: homelessness is rising in Stoke. How desperate can you be when you have nothing to feed your children and debt collectors are pressing? A man who went totally blind last year has been thrown off disability benefit for missing an appointment, his debts building as he has a spare room.
Some have lost disability benefits after an Atos test, and can no longer make ends meet. Many are deeply ashamed at having to beg for a food parcel. Council tax and bedroom tax debts escalate. One frantic woman loses it after being evicted, her husband's family is harassing her, and she's been kicking off at the jobcentre, which doesn't help. Then her phone battery goes. Calls to this office have risen by a quarter but the fund has exactly £80,000 a month, regardless of demand.Some have lost disability benefits after an Atos test, and can no longer make ends meet. Many are deeply ashamed at having to beg for a food parcel. Council tax and bedroom tax debts escalate. One frantic woman loses it after being evicted, her husband's family is harassing her, and she's been kicking off at the jobcentre, which doesn't help. Then her phone battery goes. Calls to this office have risen by a quarter but the fund has exactly £80,000 a month, regardless of demand.
If Cameron and Osborne visited Stoke Citizens Advice bureau, they'd find people queueing round the block as the service struggles to cope with this crescendo of woe. The debt advisers find growing numbers cannot survive as benefit cuts and council and bedroom taxes push them over the edge. There is no Sky, no cigarettes, no drink – yet after rent and electricity many are left with an impossible £10 a week for food, clothes, travel and everything else.If Cameron and Osborne visited Stoke Citizens Advice bureau, they'd find people queueing round the block as the service struggles to cope with this crescendo of woe. The debt advisers find growing numbers cannot survive as benefit cuts and council and bedroom taxes push them over the edge. There is no Sky, no cigarettes, no drink – yet after rent and electricity many are left with an impossible £10 a week for food, clothes, travel and everything else.
"The economy has left intensive care," Osborne boasted this week. That's not how it feels to those drowning in a rising tide of debt and despair. Nor does it feel that way to the squeezed majority whose average incomes are down by 7%. Will voters in 2015 tolerate the prospect of two years of far deeper cuts? Labour should strongly resist. As Carl Emmerson of the IFS says, there are alternatives: the deficit can be shrunk by taxes not cuts, and action can be spread over time. Above all, there is no economic reason why pain should fall hardest on those who can bear it least."The economy has left intensive care," Osborne boasted this week. That's not how it feels to those drowning in a rising tide of debt and despair. Nor does it feel that way to the squeezed majority whose average incomes are down by 7%. Will voters in 2015 tolerate the prospect of two years of far deeper cuts? Labour should strongly resist. As Carl Emmerson of the IFS says, there are alternatives: the deficit can be shrunk by taxes not cuts, and action can be spread over time. Above all, there is no economic reason why pain should fall hardest on those who can bear it least.
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