What does the budget tell us about the government's values?

By Bernadette Meaden
November 24, 2017

Nothing reveals a government’s values and priorities like a budget: “For where your treasure is, your heart will be also.” (Matthew 6:21) So what does this week’s Budget tell us? The evidence suggests that the government’s heart is with the wealthy and the healthy, the strong and secure. The plight of those who are poor, sick, powerless or insecure seem to be mainly regarded as a political problem, to be solved as cheaply as possible.

The budget continued the pattern of the last seven years, prioritising deficit reduction over the welfare of Britain’s people. Austerity continues, although we know it is economically unsound, shrinking the economy as spending power is systematically reduced, and causing the most sustained fall in living standards for over sixty years. We can only assume that austerity is now driven by either ignorance (a possibility, as 85 per cent of MPs do not know where money comes from or how it is created) or ideology, as those in the Conservative party who would like to see the state as small as possible maintain the upper hand.

But even a Chancellor pursuing a dubious target could, if he chose, try to do so with a semblance of fairness. He could direct spending to the people and the sectors most in need, he could prioritise socially beneficial activity, and allow austerity to fall more heavily on areas less vital to our wellbeing.

Yet almost without exception, the decisions the Chancellor made were either to ignore, or not take seriously, urgent crises for our most vulnerable people, continue to make the poorest poorer, and use his limited largesse to benefit people least in need of help. The small measures he took to address poverty or homelessness were, I fear, the minimum he felt he could do to alleviate political pressure.

On income tax, personal allowances were once again increased. The government likes to portray this as helping those on the lowest incomes, but the fact is that it actually helps those on higher incomes most. As the Low Incomes Tax Reform Group explained, the raising of the personal allowance and the higher rate threshold means higher rate taxpayers will be £340 a year better off, lower earners will gain £70, and those on universal credit - 50p a week.  

If the government had wanted to help those on the lowest incomes they could have raised the Universal Credit work allowance, the amount people can earn before the benefit starts to be withdrawn. But they chose not to do this.

On Universal Credit, the small changes the Chancellor did make were either completely inadequate (reducing the waiting time for a first payment from six weeks to five) or simply highlighted how badly designed it was in the first place, as it was announced that a claimant’s Housing Benefit will no longer stop immediately when they claim Universal Credit.

On the change to advance payments, financial journalist Paul Lewis summarised the reality, tweeting that it means a claimant "can borrow 100 per cent (up from 50 per cent) of a month's estimated benefit and pay it back over 12 months (was six months) leaving you 8.3 per cent below the poverty line for a year." As Paul Morrison of the Joint Public Issues Team has explained, this is 'solving one problem by creating a host of others. And yet there is now the danger that some people will think the problems with Universal Credit has been 'fixed', when it is still going to wreak havoc in the lives of families.

Given a housing crisis, and deciding that he could afford to spend £3.2 billion, how did the Chancellor use it? By building social homes to rent for those in greatest housing need? No. The Chancellor chose to use that money to abolish stamp duty for first time buyers. Housing experts immediately said that far from helping, this could actually exacerbate the housing crisis by driving prices higher, increasing the wealth of those who already own property.

Even the Telegraph released a video from economist Liam Halligan, explaining what a bad move this was – if the aim was to help people in housing need. But Conservative MPs roared with delight when it was announced, and Sajid Javid’s former special adviser tweeted ‘I have honestly had 4 friends message me already today telling me that the stamp duty cut is going to make it far easier for them to buy their first home and get on the housing ladder. Exciting stuff’. So perhaps that was the target audience for that announcement.

Meanwhile, for those in real housing need, there was a relatively meagre £20 million for Help to Rent schemes and £28 million for three Housing First pilots. Of course these are welcome, but whilst the government’s own tax and benefit policies continue to force people into poverty, people will continue to be made homeless. Why not address this, instead of waiting for your policies to make people homeless, and then helping them?

Other major issues, such as social care for both adults and children, were ignored in the budget, whilst the NHS under severe pressure was given £350 million to see it through the winter, and got less in total than the Chancellor set aside for Brexit preparations.  

For those charged with the care of some of the most vulnerable people in our society, this caused real anguish. Chief Executive of the Children’s Society Matthew Reed said, “Local children’s services are reaching breaking point, leaving more and more children with nowhere to turn when they need help. The amount of central government funding provided each year for council children’s services has been cut by £2.4 billion since 2010, with more cuts to come. With nothing in today’s budget to address this, we are deeply concerned about the consequences for some of society’s most vulnerable children in the face of such a huge funding gap.

He continued, “Today the Chancellor proudly claimed that he ‘cares for the vulnerable’, sadly there was very little evidence beyond these words to convince young people and low income families that his vision for the future of Britain is one they can share in.” 

The Women’s Budget Group said, “Phillip Hammond repeatedly talked about the need to invest to secure a bright future for Britain. But his plans for investment in infrastructure failed to recognise the importance of social as well as physical infrastructure. Social infrastructure (including health, education, and care) is as vital to the economy as roads, rail and investment in high tech’.” 

It appears that the Chancellor’s priority for this Budget was to please the government’s natural supporters. The serious concerns of other groups, and growing crises for some of our most vulnerable neighbours were either ignored or addressed in a superficial manner. The welfare of those for whom the government has the most onerous duty of care was given little or no consideration. And yet, as the Equality Trust said,  "The money to improve the UK already exists, it's just overly concentrated in the hands of a very few people. Until this gross injustice is remedied, we will all suffer a far worse quality of life than necessary." All that is lacking is the political will.

 

* Summary of all the main Budget points from Ekklesia here http://www.ekklesia.co.uk/node/24675

* Distributional analysis from the Institute of Fiscal Studies showing the impact of tax and benefit reforms from 2015-2020 here 

* The Equality and Human Rights Commission has done an interim Cumulative Impact Assessment of austerity, which shows the poorest in society being hit the hardest by changes to tax, social security and public spending reforms. Read the report here 

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© Bernadette Meaden has written about political, religious and social issues for some years, and is strongly influenced by Christian Socialism, liberation theology and the Catholic Worker movement. She is an Ekklesia associate and regular contributor. You can follow her on Twitter: @BernaMeaden

Although the views expressed in this article do not necessarily represent the views of Ekklesia, the article may reflect Ekklesia's values. If you use Ekklesia's news briefings please consider making a donation to sponsor Ekklesia's work here.