Nothing in the Chancellor’s statement yesterday is likely to change the trajectory of economic stagnation the Conservatives have brought upon our country over the last 14 years. A budget focussed on the wrong priorities, void of original ideas and which fails to address the fundamental challenges of our economy and of working people.
Working people, our members, are facing serious challenges right now: paying the bills, accessing public services, a tax-burden that is historically high, and an economy in desperate need of industrial investment. They want to see support for British industry, investment in our economy and growth that will allow for sustainable tax cuts in the future. Only 11 per cent of voters believe tax cuts are the best use of any fiscal room there may currently be at this time, and most want to see the government increase, or at least safeguard, spending across all major public services. Yet the Chancellor chose to prioritise the appearance of tax cuts before the election over the long-term investment needed.
So don’t be fooled, whilst the additional reduction in national insurance contributions announced yesterday will provide some short-term relief to households struggling with a cost-of-living crisis, it is also a stark illustration of this government’s priorities and its short-term focus. The chancellor’s own fiscal plans will see the freeze on income-tax thresholds continued in the coming years, raising the tax-burden to the highest level since 1948 and resulting in many people paying more tax than before (despite the headline cut).
And with the combined cost of these cuts to national insurance totalling an annual giveaway of around £20 billion, that’s a high price to pay for a tax cut that will end up leaving many paying more in the years to come. For less than a third of this cost across one year alone, the Chancellor could have matched Labour’s commitment to invest £3bn in UK steel – protecting thousands of steelworkers’ jobs and our nation’s capacity to make primary steel.
Yet sadly, our members in the steel industry would be forgiven for thinking that the Chancellor has forgotten about them. At time when workers at Port Talbot and steel sites across the UK are living under a cloud of uncertainty, the government should have used this opportunity to look again at their flawed and now widely discredited deal with Tata.
This was a chance for the Chancellor to study the actions of his counterparts in Europe who are investing billions in decarbonising their domestic steel industries. It was also a chance for him to look at our Multi-Union Plan for Port Talbot, and to invest in the additional support needed to make our credible, expert-led proposals a reality. Doubling the £500m the government has already stumped up for Tata would avoid the need for compulsory redundancies and would safeguard Britain’s primary steelmaking capacity. Without that capacity, all the Chancellor’s warm words on manufacturing this week will prove hollow.
The Chancellor has also queued up what would likely be real-terms cuts to public spending of around 10 per cent for unprotected departments – justice, for example- confirming that day-to-day spending is still set to rise by only 1 per cent per year in real terms over the next Parliament. At a time when the cost of failing to invest in public services is rising every day, the Chancellor once again showed his priorities to be out of step with what most voters want and what our members need.
Community’s recent joint report with Public First (Beyond Bars: Strategies to Tackle the Prison Crisis) demonstrated the increased cost of underinvesting in our justice sector over the long-term and showed that the public do back investment now to address the challenges faced by the sector. Yet there was no mention from the Chancellor of investment to address prison overcrowding, no support for minimum safe staffing levels or tough responses towards assaults, and no funding to support recruitment and retention in a sector desperate for recognition and support.
Britain’s self-employed workers will also feel let down by this budget. There was nothing from the Chancellor on self-employed workers’ ongoing lack of access to proper pensions, sick pay; maternity and paternity pay and Universal Credit, or the scourge of late-payments which continues to cause untold misery and disruption.
Meanwhile our members in early years education were looking for clarity on the roll-out of the new two-year-old childcare entitlement offer in England. Whilst the Chancellor did briefly touch upon the issue today, important questions on funding still need to be answered, and there is still a real risk that valued childcare settings will be pushed over the edge when they are unable to cover the costs of increased provision.
The underlining issue here is the staff recruitment and retention crisis in the early years sector which the Conservative government has overseen. Without investment in the workforce – including on the low wages which are still such a barrier for attracting new workers to the sector – any pledges on childcare provision are not worth the paper they are written on.
Teachers and school support staff were also let down. There was no commitment from the Chancellor on addressing the disparity on Pupil Premium funding between schools, colleges, and early years settings. There was no meaningful increase in funding for vital support services for pupils – despite growing waiting lists for essential services like CAMHS – and the government is still falling short on its promises for increased per-pupil funding for our schools.
Nearly 14 years and 7 Chancellors on from the Conservatives entering Downing Street, yesterday’s budget was symptomatic of a tired administration which has run out of ideas and is fast running out of time.
Community General Secretary Roy Rickhuss said:
“For all the bluster that accompanied it, this was another lacklustre budget from Jeremy Hunt. The gulf between the priorities of an ailing Sunak government on its last legs and the needs of ordinary working people could hardly be starker.
“For all the Chancellor’s warm words on manufacturing this week, there was nothing for steel in the budget statement. The opportunity for the government to match Labour’s commitment to invest £3bn into the sector – putting Britain in line with what other European nations are spending to support their domestic steel industries to decarbonise – was totally missed. The Chancellor could also have turned the page on the bad deal for steel by providing the additional funding needed to facilitate our credible Multi Union Plan for Port Talbot on the downstream sites. Again, the opportunity to prevent compulsory redundancies and secure Britain’s primary steelmaking capacity was shunned.
“Elsewhere, there was nothing of substance in the budget statement for self-employed workers and freelancers; and precious little for our members in the education sector who feel undervalued by this government. Early Years educators will also feel that their concerns about the roll-out of the increased childcare entitlement next month have not been adequately addressed. Ministers must provide urgent assurances on funding for staff and childcare settings before it is too late – many providers are still concerned that they will be pushed over the edge.
“After 14 years of economic stagnation and mismanagement, the British public have had enough. Nothing in the Chancellor’s remarks today will change that, and we need a change of government to get Britain moving again and give working people a brighter future.”
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© Community Trade Union 2024