Wednesday, 27 February 2013

Tory-led changes to welfare state targeting the poorest

The Government’s Benefits Uprating Bill is an attempt by the Government to use legitimate public anger over benefits cheats to attack the welfare state and the safety net that is there to stop children going hungry, to protect familes form the worst of unemployment. People at the bottom for whom price rises has the biggest impact and for whom an extra 1% rise would only equate to pennies.

People who cheat the benefits system should feel the full force of the law, and obviously there are people who have bought into a dependency culture where they would rather claim than seek work. I see this in Hyndburn week in week out, and it is something that I am written to about by constituents a lot. I am sick of it and it needs to end, which is why I support Labour’s Job Guarantee, which would ensure that there is an ensured place of work for everyone who has been long term unemployed; if they refuse to take it then sanctions would be put on their ability to claim benefits.

However, this Chancellor is using the sincere concerns of the public to implements policies that will harm people who do not deserve it. For instance, around two thirds of those who will lose out are working – something that he appears not to want to acknowledge. Work is at the heart of Labour’s Job Guarantee – not Osborne’s policy.

Moreover, the Child Poverty Action Group estimates that the Bill will add 200,000 to the number of children living in poverty in the UK by 2015. However George Osborne doesn’t mention this fact either.

My concern for Hyndburn is that we have the second highest number of people living on the breadline in the UK. This means that an unexpectedly high utility bill could push 30% of my constituents into official poverty. The problem with this Bill is the relationship that it has with inflation. The Bill breaks the link between the increase in benefits payments and the increase in the cost of living. Limiting the increase to 1% means that with inflation at 2.7% in January, it is basically a benefit cut of 1.7% vis-a-vis the cost of living.

Osborne is basically linking the living standards of many of the poorest, striving and hard working people to his ability to get a grip of inflation. He hasn’t exactly shown himself to be a particularly good chancellor to date, so I have real concerns about the future of this. Another aspect of this is the fact that the newly appointed Chairman of the Bank of England, Mark Carney stated that he thought the Government should be more relaxed about inflation.

I am very concerned about how many of my constituents could be pushed into official measures of poverty as a result of this. I would be a lot more comfortable if at the very least there were measures to protect children from these changes, and that the 1% uprating limit would be looked at again if there is an inflation spike. That is the very least that needs to happen.

This kind of spending change would normally be included in a budget statement and the subsequent finance bill, but George Osborne has written this as a separate bill as he is happy to waste Parliament’s time drawing out this bill for media attention. The affect on people’s lives are an afterthought.