Wednesday, 20 October 2010

Eyes on Power’s Guide to the Cuts

The government’s Comprehensive Spending Review has outlined some of the most extreme and – in the view of EoP– aggressively regressive and unnecessary cuts in the history of modern Britain. We’ve picked out some of the most important areas and tried to get behind the spin.

Defence: 42 000 armed forces personnel and MoD civil servants to lose jobs
Who will it affect? Private sector growth is meant to absorb public sector workers – but there are few private sector equivalents to the army, RAF and Royal Navy. A significant proportion of homeless people in the UK are ex-armed forces whilst ex-serviceman disproportionately struggle to find work when they return to civilian life and can often struggle with drug and alcohol dependency. But as least we have money for a brand new aircraft carrier – even if we can’t afford any aircraft to go on it.

Benefits #1: Council Tax Benefit to be cut by 10%
Who will it affect? Everyone in receipt of Council Tax Benefit – from pensioners to people with disabilities. The effect will price low income families out of affluent areas and will exacerbate the divide between the prosperous South East and the rest of the UK. Local authorities will determine rules for paying benefit – which feels like a major cop-out from the government and attempt to shift blame.

Benefits #2: Housing Benefit, Jobseekers Allowance, Incapacity Benefit, Employment Support Allowance and Disability Living Allowance to be merged into Single Credit
Who will it affect? Everyone in receipt of state benefit – from those incapable of working to single parents. The “catch-all” approach of a Single Credit will abandon all bespoke benefits aimed at helping different people with different needs. This will make it harder for people to return to work, particularly those furthest from the labour market – including young people, ex-servicemen, care leavers, ex-criminals, people with substance abuse problems, lone parents and people with mental and physical health issues.

Benefits #3: Claimants will face a reduction in benefit after 12 months of unemployment
Who will it affect? With £20bn of immediate cuts to the benefit system, long-term unemployment will become entrenched. There is reduced state support for back to work schemes whilst all incentives to encourage employers to recruit long-term unemployed people – including the Local Employment Partnerships, Employer Subsidies and Future Jobs Fund – have been abandoned. The new measures will force people out of affluent areas, ghettoise communities and unfairly hit young people and women.

Health: NHS budget to rise every year
Who will it affect? Protecting health spending was a key Tory election pledge – but we have already demonstrated in whose interest the decision was made.

Economy: 24 quangos to be axed
Who will it affect? As George Monbiot demonstrated, the government have carefully abolished quangos associated with protecting the environment, animal welfare and the arts but have protected – or adapted – those which promote and protect corporate profit.

Arts funding: 30% cut to Arts Council but free entry to museums to continue
Who will it affect? Mainly regional arts-based projects including theatres, orchestras arts venues and festivals. Only 15% of the cuts from £449.5m to £349m in the next four years are supposed to affect “front-line” funding, but in real terms the Arts Council estimates over 100 organisations will lose financial support. The pledge to keep free entry to museums will favour the national London-based museums, with regional museums and arts projects being left behind.

Media: BBC licence fee frozen for 6 years
Who will it affect? Everyone paying for a TV licence will not see any increases and free licences for over 75s have been protected. But these concessions can only be afforded by the government relinquishing responsibility for the World Service, and Welsh Language broadcaster SC4. The BBC will now have to swallow these budgets. There were hints that the corporation feared worse, but the 16% cut in funding will undoubtedly have a negative effect on programme quality, employment opportunities, and niche radio services like 6Music.

Transport: Cap on rail fares removed from 2012 but Crossrail stays
Who will it affect? People who cannot afford the running costs of a car and commuters who buy season tickets. The current price cap limits fares to 1% above inflation, but from 2012 this will increase to 3%, meaning fares are likely to rise by 5.8%. This may not sound like much, but for a Brighton to London commuter, it will mean a £1,000 increase on their season ticket. Meanwhile the £16bn Crossrail project that will bring faster trains on tube routes has been retained, another project that will benefit Londeners and perhaps a political move to help Boris Johnson get re-elected as mayor 2012.

Science: Research budget ringfenced at £4.6bn
Who will it affect? Academics, practitioners, everyone? The benefits of scientific advances over the years are unquestionable. When rumours emerged that the research budget may be cut up to 25% weeks ago, it caused outrage from scientists in the UK. Even 'Scientists for Labour' sent a delegate to the conference last month to raise their concerns about budget cuts. Today's announcement that the research budget will be kept at £4.6bn for the next four years appears to be good news for scientists. It actually represents a cut in real terms of 10% over the four years.

Local Government
: Council funding to be cut 7.1%pa and ring-fenced grants abolished
Who will it affect? The government are championing local government reform as devolving power but it really means shifting responsibility for cuts. Many councils will use the auspices of government restrictions to outsource services, cut departments and privatise provisions. Those hit hardest will be those most in need of state support and areas dependent on the public sector for employment – such as the North-East and Wales.

Education : Real-term cut of 3.4% funding over four years. Direct funding protected with school budgets rising from £35-£39bn. £2.5bn pupil premium for ‘disadvantaged’ pupils. Sure Start protected. EMA scrapped.
Who will it affect? This is an interesting mixture and of course does not tell the full story. On the surface it would appear that the vulnerable are protected but if you couple these announcements with previous Tory policies of building less schools and encouraging ‘independent’ academies, the true picture emerges – more money in private hands and an insufficient amount of funding for the state sector. Again, the undermining of the universality of what should be a fundamental right underpins the Tories’ whole approach here.

Justice: 14 000 jobs to be axed – 20% from frontline prison, probation and court services. Extra prison building programmes scrapped. Police budget to be cut by 4% a year.
Who will it affect? Cuts in legal representation will of course hit poor people the hardest. In addition, less prison places will not mean that there is likely to be an appreciable drop in the numbers of people being sent to prison, just that an even more overcrowded, unsafe and generally unfit prison system will be created. Cutting the police budget will have effects on front-line services from police response times to victim support.

Spending: Government departments to be cut on average by 19% over parliament
Who will it affect? An estimated 500 000 public sector workers will lose their job – not to mention local government employees and private sector contractors dependent on public finance. Employees on fixed-term contracts and part-time hours (mostly women) will be the likeliest to go. The cut in public services will adversely hit poorer and more vulnerable people as they are reliant on state provisions.

We will of course be returning to the subject of cuts in more detail, but in the meantime why not let us know what you think of the cuts? Do you agree that cuts are necessary to reduce the deficit? Or do you think the fetishisation of deficit reduction is distracting from the need for a real structural change in our society?

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