From the TUC

#Budget2015: Where could £12billion of welfare cuts come from?

19 Mar 2015, by in Society & Welfare

How could £12 billion of welfare cuts be achieved?

We have previously looked at the sorts of changes that would be needed to raise the revenues the Chancellor has set out. These proposals make clear the enormity of changes being considered. For example (with all changes concerned with the position by 2017/18):

  • If Jobseekers Allowance was completely abolished it would save £2.56bn
  • If Carer’s Allowance ceased to exist £2.5bn would be saved
  • If Maternity Allowance was cancelled it would save £0.47bn

These cuts only take us to £5.5bn. Less than half of the Chancellor’s target.

Richard has considered what has already been announced (which appears to total around £4bn at most). Freezing all working age benefits (including tax credits, support for disabled people, support for carers, payments to help those on lower and middle incomes with childcare and housing) for two years is a very tough policy which would lead to most low earners losing far more than they gain from any of the Chancellor’s tax giveaways. Removing housing benefit from young people (as Centrepoint set out here) would be disastrous for many of the most vulnerable young people in the country. The pain these cuts would lead to would be significant.

TUC analysis has also previously looked at the Chancellor’s record on welfare, finding that most of the cuts made to date have fallen on working families, with working parents and their children facing the biggest cuts of all.

  • Three-quarters of all welfare cuts to people of working age have hit working families
  • Almost half have hit working families with children.

With the Chancellor’s record apparently the best judge of how the future pain would be felt, it seems a fair assumption that it would be the same group who would be targeted again.

So what further pain could be in store? If Child Benefit was completely abolished, £12bn would be saved. If working tax credit and child tax credit spend was slashed by more than a third the same savings could be reached (which would likely involve removing childcare entitlements and significantly cutting the help available to working families with children). The impacts on household living standards would self-evidently be severe.

Every working family in the country has good grounds to be concerned about the impacts on their living standards should the Chancellor’s plan be put into action. Whether it was through completely removing vital support for those who lose their jobs, removing extra help for those with young children or leaving young homeless people without anywhere to live, the Chancellor’s plans would inevitably hit very hard.


5 Responses to #Budget2015: Where could £12billion of welfare cuts come from?

  1. #Budget2015 Roundup – ToUChstone blog
    Mar 19th 2015, 5:25 pm

    […] Chancellor referred to £12 billion of welfare cuts. Nicola Smith crunches the numbers to see where those cuts could fall, while Richard Exell asks which cuts are likely to be […]

  2. Jayne Linney
    Mar 20th 2015, 8:47 am

    Once again the TUC have failed to include the severity of CUTS already experienced by Disabled and Chronically Sick benefit claimants : we’ve already suffered
    The end of ILF
    The end of DLA, replacement with PIP
    Time-limiting and means-testing ESA
    Changes built into development of UC
    Changes included in cuts to Housing Benefit
    Reductions in relief for Council Tax for disabled people

    Disabled and sick people are often Union members too!!

  3. #Budget2015: A review of how the Chancellor manipulated the figures to political ends – ToUChstone blog
    Mar 20th 2015, 9:11 am

    […] details for how these cuts will be achieved. While debate around this unexplained £12 billion is important, there is far more to the Budget than […]

  4. Saving Our Safety Net Fact of the Week: even small victories should be celebrated – ToUChstone blog
    Mar 20th 2015, 12:17 pm

    […] pounds to deal with the horror of kebab-filching seagulls and is willing to pay for that with £12 billion of cuts in benefits. But at a time when the Conservatives believe that welfare cuts are one of […]

  5. trev stan
    Mar 27th 2015, 12:12 am

    The welfare state is being dismantled and the NHS is being privatised. Welcome to 21st century Britain.
    Yet the unions who helped build this fabric into postwar Britain sit back and do nothing.