From the TUC

Not a Statement for Fairness

05 Dec 2012, by in Society & Welfare

The Chancellor announced that

today … we show our determination to do this fairly, with further savings from bureaucracy, from benefit bills and the better off.

But the Autumn Statement document belies this. Many of the decisions don’t come into effect until round about the time of the next election, so here’s a list of the cuts and tax increases announced today and how much they are supposed to save/raise in 2015/16:

Well, the first two items in his list are certainly there – increasing working age benefits and tax credits by substantially less than inflation accounts for more than a third of the total and cuts in public sector employment and wages for nearly a third. But have the “better off” been hit anything like the same extent? The one thing the rich will definitely dislike is the restriction in pension tax relief, but this is comparatively small beer.

Under the heading of “tax avoidance” I’ve included both the Treasury’s income from the tax treaty with Switzerland and the new anti-avoidance measures, and the Chancellor made a great deal of them in his speech. It still doesn’t bring the total burden borne by the better off to the same level as public sector workers and people on benefits. And, let’s be clear, this is simply enforcing the laws they should obey in any case.

The Chancellor went to great lengths to praise his deal with Switzerland, but, as the Financial Times said a few days ago (£), is “too lenient” and “sanctions anonymity.” It may be “better than nothing”, but equally it “may not make back what was originally owed.”

To portray this as an equal sharing of burdens is gross distortion.

By the way, if you were listening to the debate in Parliament, did you notice the Chancellor’s line about “not spending more” than 0.7% of GDP on foreign aid? I’m not surprised if you missed it, you may have been blinking. The revision downwards of the forecast for GDP has a substantial impact – it means that the UK will spend £515 million less on foreign aid than was originally planned – 5.2% of the cuts/revenue increases.


One Response to Not a Statement for Fairness

  1. Overseas aid: giving with one hand… | ToUChstone blog: A public policy blog from the TUC
    Dec 8th 2012, 10:56 pm

    […] my colleague Richard Exell pointed out, these figures mean that more than 5% of the cuts in departmental expenditure announced on […]