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Public Works is UNISON Scotland's campaign for jobs, services, fair taxation and the Living Wage. This blog will provide news and analysis on the delivery of public services in Scotland. We welcome comments and if you would like to contribute to this blog, please contact Dave Watson d.watson@unison.co.uk. For other information on what's happening in UNISON Scotland please visit our website.

Wednesday, 15 July 2015

More devil in the budget detail

As we expected, a more detailed analysis of the budget shows that low paid workers, the young and the poor are bearing the brunt of the measures he announced.

As one academic puts it, "George Osborne’s budget is beyond spin: it is an assault on public welfare, and on the public understanding of government."

As usual it is the IFS that comes up with a reliable analysis. The chart below shows the poorest deciles of the population suffering the biggest income falls in relative terms since 2010 (the blue line) as well as being hit the hardest in this latest budget (the yellow bars).

Even the most positive announcement, the new National Living Wage, is misleading. The Resolution Foundation, said the label did not reflect the reality, "The new 'National Living Wage' is a welcome policy with a somewhat misleading title. It has legal clout - which the voluntary Living Wage doesn't - but it also fails to reflect how much families need to earn to have a decent standard of living." The proposed NLW is "in fact a minimum wage "premium" for those aged 25 and over," his organisation said in a briefing.

They also warned: "The new minimum wage premium cannot tackle Britain's low pay problem alone. Almost a quarter of workers on the minimum wage fail to progress beyond it within five years and this could rise if the National Living Wage becomes the 'going rate' in many sectors."

That is where the cut in tax credits hits hardest, because it supports families. The impact is highlighted in this chart.

And the National Living Wage doesn't apply to the under 25's. The latest findings of the Intergenerational Foundation, highlight a sharply widening gap on its "fairness index" between people under 30 and those over 60.

Since 2010, the report shows, there has been a 10% decline in young people’s prospects across a range of measures including housing, education, health, income and debt. This is exacerbated by a budget with welfare cuts that will hit many young families, ended automatic entitlement to housing benefit for those aged 18 to 21, and replaced maintenance grants for students in England with a loan system.

As always with a budget the devil is in the detail. And there is plenty of the devil in this budget.


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