This article was written by Amelia Gentleman, for The Guardian on Thursday 1st January 2015
George Osborne says the coverage of looming new spending cuts has been “hyperbolic”, but away from Downing Street there is a strong consensus that the cumulative effect of five years of austerity will make the next wave of cuts, in 2015, very painful.
Four more years of austerity is “a price that works for our country”, Osborne said as he outlined his strategy. The Institute for Fiscal Studies responded by warning that “colossal” cuts to the state would take total government spending to its lowest level as a proportion of national income since before the second world war. By the end of the process, “the role and shape of the state will have changed beyond recognition”, the think tank said. So far, £35bn has been cut; the plan is to cut a further £55bn by 2019.
If the chancellor remains in post after the general election, Britain will find itself halfway through a nine-year stretch of spending cuts, with the Conservatives determined to shrink and redefine the role of the state. The Liberal Democrats say the Conservative policy is aimed at creating “a smaller state, with many more cuts to come”, giving Britain “austerity for ever”; 2015 will be a pivotal year in the race to reshape the nature of the state.
> Would that be the same Liberal Democrats who are part of the coalition that is making these changes to society ? Sorry, Lib Dems, don’t start wringing your hands now – you won’t get rid of the blood on them that way.
Even if they lose, difficult spending cuts look inevitable. Labour is also committed to ending the deficit, in 2017-18, provided the state of the economy allows it.
For many publicly funded services and organisations, 2015 will be the year when their chances of survival become clear. There is an enormous range in the size and the function of services under threat, which makes tracking the scale of the cuts challenging.
Here are just four examples – from the large scale to the tiny, of services that are set to go this year.
In June, the Independent Living Fund, which provides funding for around 18,000 disabled people to work and live in the community, will be wound down. In Liverpool, there will be a decision in early 2015 over whether the council will close a possible 23 out of the city’s 26 Sure Start centres. On a smaller scale, organisations including the Islington Centre for Refugees and Migrants, in north London, which supports around 150 refugees and asylum seekers, providing English classes, faces closure because of cuts to education budgets.
“These are people who come to us on a daily basis who desperately need some kind of support,” project manager Andy Ruiz Palma says. “I would lose my job, but I am more worried about the clients. There is nowhere else for them to go.”
In Ealing, west London, parents are campaigning to save the lollipop crossing role, done for the past 20 years by Eileen Rowles, and now at risk of being discontinued because of council spending cuts.
The Office for Budget Responsibility said in December that the chancellor’s plans would mean one million further government job losses by 2020 (a total fall from early 2011 of 1.3 million), representing a 20% fall in headcount.
Over the past five years, there has been surprise and relief from politicians that public anger about spending cuts has been relatively muted. Aside from a few annual anti-cuts marches in big cities, Britain has not experienced the waves of protest seen in countries such as Spain. Given that those most affected by the cuts are the most vulnerable and disempowered people in society, it’s perhaps not surprising that the response has been muted.
But that could change in 2015. The next stage of cutbacks is likely to be harder to ignore. The easy decisions have already been made; once the low-hanging fruit has been removed, finding new things to cut gets harder, which means the second half of the austerity era is likely to be much tougher than the first.
By next May, government funding for councils will be 40% lower than it was in 2010; and a further 13% will need to be cut in 2015.
“It is individuals who have paid the price of funding reductions, whether it is through seeing their local library close, roads deteriorate or support for young people or families scaled back. Further reductions without radical reform will have a detrimental impact on people’s quality of life,” the Local Government Association chair, Tony Sparks, says.
The National Audit Office has warned that more than half of councils currently risk falling into serious financial crisis before the end of the decade. Some may struggle to provide services that they are legally obliged to offer, and this may become apparent in 2015 with more legal action by service users.
Nicola Smith, head of economic affairs at the TUC, says:
“The scale of the spending cuts that the chancellor set out in his autumn statement briefing is truly severe. The public sector has already experienced five years of austerity. The consequences for key services that people rely on are severe.”
Osborne has said that if the Conservatives win the election he will want to cut a further £12bn a year from the welfare bill – on top of the £20m-£25m that has already been cut. He proposes freezing working-age benefits for two years, reducing the overall benefit cap from £26,000 to £23,000, and limiting access to housing benefit for people under 21.
Professor John Hills, director of the Centre for Analysis of Social Exclusion at the London School of Economics, says that the impact of further cuts in this area would be very painful.
“Both the political and public belief is that spending on out-of-work benefits is a large share of overall public spending; it is not. Trying to make large savings from what is really a small share of public spending will require increasingly harsh cuts. We have seen this already through things like the bedroom tax, the imposition of council tax on people with very low incomes, and the greatly increased use of sanctioning. To continue to get more savings from that group will require harsher measures.”
Source – Welfare Weekly, 01 Jan 2015
This article was written by Leah Green, for theguardian.com on Wednesday 21st May 2014
Changes to the habitual residence test, designed to make it harder for European Union migrants to claim benefits, mean UK citizens who have been abroad for an extended period cannot claim jobseeker’s allowance (JSA) for the first three months after their return.
It means that people who travel for more than three months – including gap-year students, graduates and people taking career breaks – are being denied JSA to help them while they find a new job.
The new rule came in on 1 January, the same day it became legal for migrants from Romania and Bulgaria to enter the UK on work visas. In a government-issued statement on the new rules, the work and pensions secretary Iain Duncan Smith said: “The British public are rightly concerned that migrants should contribute to this country, and not be drawn here by the attractiveness of our benefits system.”
However, in attempting to combat predicted “benefit tourism” from eastern Europe, the government has made it impossible for UK citizens returning from abroad to claim as well.
Yvette Cooper, shadow home secretary, said:, “British-born citizens who have been travelling, doing internships or living abroad temporarily shouldn’t be treated in the same way as those coming into our country for the first time.
“Habitual residency rules should be about making sure people who are new arrivals to the UK, and have not yet made any contribution or commitment to this country, do not claim benefits they are not entitled to. British citizens are in a completely different situation, and the government should recognise that.”
Rosie Smith, 24, and her boyfriend Alexi Dimond, 29, are both from Sheffield and returned to the country in March after almost six months living and doing voluntary work in Thailand. Smith had been in the same city since she was born. She wanted “a bit of a change”, she said: “I had been in Sheffield my whole life. I just wanted six months not in Sheffield.”
Smith saved money from her job as a nursery nurse, while Dimond worked in administration at an NHS dental hospital. When they got back, they wanted to look for work immediately and registered with the Jobcentre the next day. Dimond claims the person asking him questions for the habitual residence test was “very apologetic” for even making him undergo it.
He was told he was not, under the new benefits rules, considered habitually resident in the UK and would have to wait three months before claiming JSA. “I thought it was outrageous really,” he says, “I’ve contributed tax for the last six years working for the NHS. I think it’s ridiculous I’m not entitled to anything.” He now had no money at all, he said, and was relying on friends for food. Smith has moved back in with her parents.
Alongside his job, Dimond had done voluntary work with asylum seekers for five years before leaving the UK. When enquiring at the Jobcentre how he was supposed to survive, he was handed a leaflet entitled Emergency Help in Sheffield. It is the same leaflet he was issuing to asylum seekers before he went away. “It’s basically the help you get when there is literally nothing else,” he explained.
British citizens have always had to take a habitual residence test before being granted benefits, but only since the rules changed on 1 January have people been told they automatically fail for spending time out of the country.
Sam, 25, is back living with his parents in Manchester for the first time in seven years after being refused JSA on his return from a year in the Netherlands where he was doing a master’s in psychological research.
Sam had hoped he would get a job as soon as he got back “but that’s not the case,” he said, “so I applied for jobseeker’s soon after I got back.”
He was taken aback to have his application for benefits turned down. “I think if you’re looking for work you should get jobseeker’s allowance. That’s what makes sense,” he said.
Sam’s parents are providing his food and shelter, and he is dipping into savings to travel to job interviews in London. He realises he is lucky to be cared for, claiming it is unfair on others “who don’t have that support. You would think then that support should come from the government.”
However, he is sympathetic to a tougherstance on immigration, agreeing that migrants “shouldn’t be able to claim [straight away] if they come from abroad.”
Emma Birks, 36, was a volunteer co-ordinator at a worker’s co-operative in Birmingham before deciding to go travelling in south-east Asia. “I’d been putting it off and putting it off,” she explained, “and then sometimes you think ‘life’s too short’.”
Since she got back in March, Birks has had no home and has been living between the houses of “three or four” charitable friends. She has been surviving by taking handouts and using credit cards. Because of her work, she knew about the habitual residence test and never dreamed she would fail it. She describes her situation now as “a bit demoralising and humiliating.
“The whole point of jobseeker’s allowance is to help you in that interim period where you’re looking for work, trying to find a new start or whatever. To me, that’s the whole point of jobseeker’s and it’s just failed me basically,” she said.
Dimond agrees. When we speak, he and Smith are at the beginning of five days of agency work, stopping people in a Doncaster shopping centre and collecting surveys about the facilities. He has had to borrow the money to get to work, and estimates he already needs “about six months” to catch up on his debt, assuming he gets a job soon. “It’s seriously affected my job search,” he said. “I don’t have money to get to interviews.”
Smith thinks they are victims of statistics. The Department for Work and Pensions (DWP) “are just trying to get as many people off their system so they can make their numbers look better … so they can say hardly anyone’s signing on anymore. But they’re just disqualifying everyone,” she said.
A DWP spokesman said: “It has always been the case that any UK national who chooses to live or work in another country for an extended period must, if they return to the UK and want to claim benefits, satisfy the habitual residence test by proving they have strong ties to the country and want to remain here.
“People who have paid enough national insurance in the UK do not have to wait for three months before claiming jobseeker’s allowance.”
The spokesman did not respond when asked how much national insurance was enough, but none of the people interviewed were exempt from waiting three months.
The announcement of the changes in December confirmed the the introduction of the new three-month period in which people cannot claim benefits.
Source – Welfare News Service, 21 May 2014