On Wednesday, George Osborne delivered the first Conservative only budget for almost two decades. The budget had many true blue Conservative policies in it on welfare and taxation; as well as a so-called "national living wage". Above all else this budget represented an attack on some of the most vulnerable in society. This budget will do much to undermine the welfare state of William Beveridge.

The £12 billion welfare cuts that Osborne is imposing will undermine social justice. They represent an ideological attack which will further divide the country between rich and poor. Two years ago, I wrote a blog for the SLF criticising the benefits increase cap of 1%, the Tories will now freeze most working age benefits preventing any rise from 2016 until 2020. This will result in a real terms cut as inflation increases.

Poorer families will be hit by the latest round of welfare cuts. Child Tax Credit will be limited to two children, undermining big families and no doubt resulting in an increase in child poverty. Furthermore the decision to reduce the income threshold for tax credits will limit them to the very poorest. Osborne's decision to reduce the overall benefits cap will disproportionately hit people living in London, making it even more difficult for welfare claimants to live in the Capital.

This budget undermined the welfare of young people, forcing them to “earn or learn”. Those aged between 18 and 21 will lose their automatic entitlement to housing benefit. Students from poor backgrounds who want access to higher education have seen their maintenance grants cut by the Chancellor. As for the so-called "national living wage" it will only apply to people over the age of 25, once again leaving young workers with second rate pay.

Unemployed people with disabilities have also been hit by this budget. The work related element of employment and support allowance (ESA) will be cut to the same level as jobseekers allowance. In essence, Osborne has abolished work related ESA, this is despite the fact that the 492,000 people affected will have disabilities and chronic illnesses. The additional money from ESA is needed to pay for the additional support that people with disabilities need in order to be more independent. 

On taxation, Osborne is wrong to give a tax cut to corporations, the big banks, wealthy inheritors and well off earners. The priority must be to give tax cuts to the poorest workers, a precedent established by the Liberal Democrats in the last Parliament. Although the income tax personal allowance is continuing to rise; it has already helped the poorest low-paid workers. The priority should have been to raise the national insurance threshold which is currently set at a much lower level.

Finally, there was the big announcement of a national living wage. Although this seems progressive on the face of it, it does come after significant cuts to welfare and tax credits. The living wage is calculated according to the amount needed to afford a decent standard of living. Welfare cuts will undermine the fairness of Osborne's living wage and without access to vital tax credits many low-paid workers will find it even more difficult to make ends meet. Always beware Tory wolves in progressive sheep’s clothing.

Osborne aims to change the political debate, but in order to do so he has chosen to sacrifice the principles of Beveridge’s welfare state. The £12 billion cuts represent a right wing ideological attack on low-paid workers, poorer families, young people and unemployed disabled people. These groups are by definition some of the most vulnerable in our society. As the poor see their welfare cut, rich corporations, banks and individuals see their taxes gradually cut. The national living wage is not worthy of the name. It is a shameful Conservative appropriation of a progressive term that will not achieve true social justice.

George Osborne wants to change the consensus of British politics but we social liberals must stand opposed to him. You must renew the social liberal welfare consensus that William Beveridge established. Only through direct redistribution from the richest to the poorest will we achieve true social justice and greater equality. The Tory ideological vendetta against Beveridge’s legacy must be opposed. Tory divide and rule has long since been outdated and we must oppose the vilification of the poor coming from the right. The fundamental mission of social liberalism is to free individuals from poverty. Far from freeing individuals from poverty, this budget will further entrench social injustice.

Share this page to spread the word.
Share Tweet