It has felt like a very long four weeks since the Chancellor delivered the Budget, not least because of the terrible tragedy of the death of Jade Lomas-Anderson by a dog attack in my constituency, so when I came to write my speech today, I had to wrack my brains to remember what the Budget was all about. My overwhelming memory is of the Chancellor sitting on the Front Bench looking like a little boy lost, with no idea what to do about the flatlining economy, no idea what to do to stop a triple-dip recession, what to do about the loss of our triple A status, or what to do about the level of borrowing, and no idea how to balance the books. So he delivered a Budget that did none of those things, sitting on his hands, hoping that things will just happen.
Of course, things are just happening. Unemployment in my constituency, Bolton West, is up. One in 10 people in Greater Manchester skip meals so that other family members can eat. Nationally, homelessness and rough sleeping are up by a third. Shelter says that every 15 minutes another family is made homeless. The economy may be flatlining, but people’s income and spending are not. The OBR has said that in 2015 people will be worse off than they were in 2010. Wages are £1,200 lower than in May 2010. This year a family with two children and one earner earning £20,000 a year will be at least £381 worse off, and next year will be £600 worse off. Inflation, of course, is still running at 2.8%. Behind those figures are real people having a desperately hard time—people who are losing their homes, having to choose between heating and eating and relying on food banks to feed themselves and their children.
Tinkering at the edges will not solve the problem, and neither will blaming the poor for the situation they find themselves in. According to the Joseph Rowntree Foundation, 6.1 million people living in poverty are in working households, 6.4 million people lack the paid work they want and 1.4 million part-time workers want full-time work, the highest figure in 20 years, and 100,000 of the so-called new jobs pay no wages whatsoever. The churn of people in poverty or out of work is substantial. While 18% of people are on a low income at any one
time, 33%—one in three of us—experience at least one period on a low income in a four-year period, and 11% of people are on a low income for more than half of those four years.
In 2012, 1.6 million people were claiming jobseeker’s allowance at any one time and 4.8 million had claimed it at least once in the previous two years. Those figures show that the Government’s desperate efforts to categorise people as skivers or strivers are a travesty of the truth. Some 2.5 million people, including 1 million young people, are not shirkers or skivers; they are people who need the Government to take action to create jobs. But there was no mention in the Chancellor’s Budget speech of what he would do and there has been no action; he simply hopes that something will happen.
What do we get from the Government parties? We get a tax cut for millionaires, paid for by the poor. What excuse have they given for cutting tax for millionaires? They say that the millionaires were not paying it. If only we could all get a tax cut just because we did not want to pay tax. The Government failed to tell people that they do not actually know how much money the 50% tax rate would raise, because in the first year people brought forward their income and this year people will delay it, but HMRC has said that it could raise £1 billion. If people are avoiding paying tax, surely we need to shut down the avoidance schemes, not cut the tax rate in the hope that they will stop using the schemes now that they have found them. It is a shame that the Government have not shown the same concern for people earning £41,000, who, without any pay rise, will now find themselves in the 40% tax bracket. Hundreds of thousands of hard-pressed families will now be paying more tax, without a thought from the Government.
There were one or two promises of jam tomorrow, such as help with child care in two years’ time, a single-tier pension in 2016 and capped care costs in 2016. I was interested to read Age UK’s briefing after the Budget. It welcomed the earlier implementation of the care costs cap and the higher upper means-tested threshold from April 2016, but it said that that would do nothing to help the 800,000 older people who need help with everyday tasks but receive no formal state support. Since the Government came to power, £700 million in real terms has been cut from social care funding.
Age UK also stated:
“The Chancellor may have confused”—
people—
“in his speech by referring to raising ‘the threshold of the means test on residential care from just over £23,000 to £118,000’. He was in fact referring to the upper means test threshold and older people will have to make contributions based on a sliding scale towards the cost of their social care if they have assets between the two amounts.”
It went on to say that the Budget offered no proposals to improve pensions for current pensioners or to reduce pensioner poverty, which currently stands at 1.7 million people. It was also disappointed that the Government are not doing nearly enough to help tens of thousands of older people whose income, health and well-being are being affected by the cold weather.