The Robin Hood Tax Campaign has called on George Osborne to include in his Emergency Budget a tax on the financial sector that could help prevent some of the cuts in public spending which will have the most impact on the poor and vulnerable.
The £6.2 billion worth of cuts announced by the Government last month are already hitting public services that are crucial to those who are in most need - children, the unemployed and those suffering from long-term illness - according to the broad coalition of organisations that back the Robin Hood Tax.
Despite pre-election claims that an early cuts package could be found from efficiency savings, a programme to support children with reading difficulties (£5 million), the Future Jobs Fund (£5 billion) and free social care to 11,000 older people (£540 million) are among projects that have already been scrapped. Further cuts in public spending would inevitably increase unemployment and increase poverty, says the Campaign.
The Chancellor should therefore put more emphasis on raising new funds from taxation and build on the call he made in his Mansion House speech for a bank levy, the Campaign says.
Robin Hood Tax research shows that a new financial sector tax could raise at least £20 billion a year in the UK and could therefore make a significant contribution to closing the structural deficit and prevent cuts that would do a great deal of damage to the country's social fabric and services on which some of the poorest people in UK society depend.
The TUC General Secretary, Brendan Barber, said: “A harsh round of spending cuts will cost public and private sector jobs, derail the fragile recovery, and hit the poorest in our society, as they depend most on public spending.
“But it doesn’t have to be this way. Just as BP is now having to pay for the mess it caused in the Gulf of Mexico, the banks should face up to their responsibilities for causing the crash. The return of big bonuses show that they can easily afford to pay up for a Robin Hood Tax.”
Kate Wareing, Oxfam’s Director of UK Poverty, said: “We have serious choices to make in terms of how we reduce the deficit. Some spending cuts now seem inevitable but the announcements so far are once again falling on the poorest communities first.
“The Government needs to make sure the axe doesn’t fall hardest on the most vulnerable people in society, and a Robin Hood Tax on banks could raise the money needed to help save public services which are vital for people in those communities.”
Martin Narey, Chief Executive of Barnardo’s, concluded: “During the recession more and more parents have become unemployed and many have been forced deeper into debt. We don’t want the poorest families to pay the price of this recession, it’s time the banks made amends.
“Introducing a Robin Hood Tax in the Budget would make a significant contribution to this by raising billions that could protect the poorest from further cuts.”
The organisations supporting a Robin Hood Tax on the financial sector include TUC, Oxfam, Ekklesia, Barnardo’s, Family Action, UK-wide Disability Alliance, Urban Forum and Stamp Out Poverty.