Philip Hammond Philip Hammond. Photo: Flickr/Chatham House

The Spring Budget shows that the Tories are still pushing an agenda of austerity that benefits the rich and punishes the poor argues Chris Nineham

Mainstream commentators are calling it ‘the boring budget’, but its impact will be anything but dull. It will lead to yet another shift in wealth from the majority to the rich and for the poorest in society it will ratchet up the pain. In fact it’s bad news for the working population as a whole. Extra national insurance for the self employed breaks Tory tax pledges and will punish many working people including cabbies, Uber and Deliveroo workers, plumbers and electricians and so on. But the budget in general puts the lie to this government’s claims to concern for the ‘just about managing’. May has benefited up to now from not being David Cameron, and it helps Hammond that he is not George Osborne, But what the budget shows is that austerity is still the long term strategy and not simply a response to budget deficit. 

Elite economics

On the one hand the headlines speak of better-than-expected prospects for the economy with the projected budget deficit cut by £12bn. On the other hand the squeeze on public services continues. Tellingly, while there is enough money to make big cuts to Inheritance Tax, massively benefiting the better off, and to confirm further cuts to the already rock bottom Corporation Tax, there is almost nothing for the NHS despite an unprecedented, life threatening crisis in our hospitals. Experts are united in saying that the £2 billion extra for social care won’t plug the gap made by the 33,000 social care jobs lost in the last five years. 

There is money for education – to be spent on selective schools – but nothing to deal with the full blown emergency in the sector as a whole. One head teacher spoke for many when she  wrote to parents complaining ‘we have far fewer teaching assistants, fewer teachers, fewer interventions to support children’s learning, fewer books, IT resources and vastly reduced capacity to ensure that all children’s needs are met’.

Trouble ahead

Apart from the failure to respond to these specific crises, there are two deeper reasons why this budget means trouble ahead. First talk of a ‘steady as she goes’ approach ignores the fact that previous budgets have set a course of  drastic cuts to services over the next few years. According to the Local Government Association, budget cuts are set to spiral:

With social care and waste spending absorbing a rising proportion of the resources available to councils, funding for other council services drops by 35 per cent in cash terms by the end of the decade, from £26.6 billion in 2010/11 to £17.2 billion in 2019/20. 

This coupled with continuing freezes on in work benefits and cuts to universal credit are going to have a devestating effect on the lives of millions of the poorest over the next few years.

Secondly, increased inflation is likely to hit spending power quite hard and quite soon. This will add to the already scandalous situation which makes Britain the only European country where wages have continued to fall after growth returned after the 2008 crash. 

Collision course

Already anger is growing. Polls show the majority turned against austerity two years ago. The NHS demonstration last weekend surprised many by its size and militancy. Now The Guardian reports that even Tory Councillors and MPs are worried about an austerity backlash with many reporting being lobbied by constituents angry about cuts to the NHS and local services. The Brexit debate has given Theresa May’s government a bit of a honeymoon, although her personal ratings are now sliding, but the government will be judged in the end on what it delivers. This budget means the Tories remain on a collision course with an embittered population.

Chris Nineham

Chris Nineham is a founder member of Stop the War and Counterfire, speaking regularly around the country on behalf of both. He is author of The People Versus Tony Blair and Capitalism and Class Consciousness: the ideas of Georg Lukacs.

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