There is no doubt that the Coalition government’s economic strategy will hit the poorest hardest. Despite the protestations of George “We are all in this together” Osborne and his Liberal Democrat allies, the budget was fiercely regressive.
One way of illustrating this is to examine the impact of the budget on women and families. The figures are frightening. The bulk of the impact will be felt by women: 72% of the cuts will be met from women’s income as opposed to 28% from men.
There is a whole series of taxation and benefit changes that will hit women harder including: reductions in entitlement to Child Tax Credits; linking the indexation of benefits, tax credit and public service pensions to the (lower) Consumer Prices Index rather than the Retail Price Index; the cuts in Housing Benefit; freezing Child Benefit and restricting eligibility to the Sure Start Maternity Grant.
Some of these changes seem technical but the ultimate effect will be to take billions away from women. This is because a larger share of women’s income is made up of benefits and tax credits: one fifth for women compared to one tenth for men.
But it is not just the cuts in tax credits and benefits that will hit women hard. The cuts in the public sector will be a hammer blow to women. In the public sector 65% of the workers are women.
And, just like the government’s public sector cuts in general, the effects will not just be felt by women working in the public sector. In all the comments on the public sector cuts, what has not been sufficiently recognised is that millions of jobs in the private sector depend on public sector contracts.
This is particularly true of local authorities.
Ever since Thatcher there has been a tide of privatisations in the public sector. Currently most jobs in childcare and social care are in the private sector. And the majority of these workers are women. Cuts in local authority funding mean that many of these women face either losing their jobs altogether or having their terms and conditions squeezed.
Yet the Tories and their allies have been successful in depicting the cuts as merely being a matter of sweeping out bureaucrats in bowler hats. Relentless propaganda in newspapers like the Daily Mail encourages people to focus on the more ludicrous public sector job titles in the job advertisements in the Guardian. Usually these jobs are perfectly reasonable jobs under over fanciful titles. But they are always cited as examples of public sector “waste”.
Alongside the anti public sector worker propaganda, Cameron is pushing his idea of a “Big Society”. He presents it as empowering people to take over from the bureaucrats. In fact it is all about a “cut price” welfare state. He does not want voluntary workers to supplement the state or to innovate. Cameron wants voluntary work to substitute for the state.
The truth is that ordinary people (particularly single mums) do not necessarily want come home from their shift at work and take part in meetings to run their local school. Furthermore, in the cultural mosaic that is our inner cities, the type of groups that will take it on themselves to run local services will not necessarily be representative of the community as a whole.
In Cameron’s “Big Society” marginalised groups will be even more peripheral. And “time poor” single mums will probably be the most marginalised of all. But denigrating public sector workers and peddling the (superficially attractive) idea of the “Big Society” is all part of softening voters up for massive public sector cuts and a permanent shrinking of the welfare state.
So it is vital that Labour is not forced on the defensive in the debate about the Coalition government’s economic policy. To have any credibility attacking the Coalition government now, we have to offer a genuine alternative.
We need to make the case that we will not cut our way out of this recession and that women and families should not pay the price for the irresponsibility of bankers.
We have to make the case for investment and point out that investing in public sector services like schools and hospitals actually creates jobs in the private sector and generates growth in the economy overall.
Nobody disputes that we need to take tough action to deal with the deficit. But at the very least we should consider raising a larger proportion of the money from increases to taxation. This is not about increasing the tax burden on ordinary people. We could consider increasing the levy on the banks.
There is a responsibility on all of us in the Labour movement to make the “Investment not Cuts” case with renewed vigour. The life chances of millions of women and children depend on it.