BuDS is dismayed by the tax and spending changes announced by the Government today and feels it will mean harder and more difficult times for disabled people over the next few years, and possibly longer.
The Government has announced tax cuts and new handouts for private businesses and multinationals which will cost the taxpayer multiple billions of pounds, but has said nothing about how these changes are to be paid for. In reality, the only way for the Government to pay for these massive changes is by borrowing more, or by cutting public services, or both. It is completely unacceptable to launch a huge spending spree at tax-payers’ expense without also being honest and open about what this means for public services like pensions, benefits, roads and transport, education, the NHS, social care and all the other things which make society work.
This is the first budget in many years where the underlying facts and figures have not been fully published and where there has been no independent audit of the proposals by the Government’s own financial watchdogs. It is a massive leap in the dark.
The reaction of international markets has been very worrying. The international money markets have instantly made it much more expensive for the UK Government to borrow money, which means more taxpayers’ money will need to be spent on debt interest payments. A rise in Bank of England interest rates may now follow, which will make mortgages and loans more expensive. And the value of the pound sterling against the dollar and Euro has dropped sharply, meaning that imports of everything from fuel to food to clothing will now cost more – price rises which will be passed on to the ordinary consumer, including disabled people already struggling to get by.
The specific tax measures announced today will mean very little for most disabled people. Working disabled people will see a small rise in their pay packet through lower taxes and national insurance contributions. Disabled people who can only work part-time and are low-paid, and who claim Universal Credit to top-up their wages, now will be bullied and sanctioned by the DWP to work longer hours or to change jobs – something which is simply not possible for many. And disabled people who do not work will see no financial benefit at all.
As things stand, BuDS fears that the mini-budget will:
- Make the cost-of-living crisis worse by raising prices
- Require huge cuts to the public facilities and services that disabled people depend upon
- And put only a small amount of extra money into the pockets only of working people.
The Government have said that this is a budget for growth and that cutting taxes and handing huge benefits to rich people and businesses will encourage them to grow their businesses. The Government think that, if businesses grow and rich people get richer, they will eventually pay more tax and employ more people. In time, therefore, the Government think that everyone will be better off if businesses and rich people are given benefits.
Even if this theory is true (and lots of people disagree with the theory), business growth takes time. The pain of paying for these budget tax and other cuts will be felt by ordinary people now, and it may be years before the promised business growth (if it appears) starts to make things better for ordinary people. A more balanced and gradual change of policy would be much kinder for ordinary people.
In summary, BuDS thinks the mini-budget is a cruel gamble which, even if it is ultimately successful, is going to create much harsher and difficult conditions over the next few years for disabled people and for all ordinary people.
To find out more about the new mini-budget, visit https://www.theguardian.com/uk-news/2022/sep/23/kwasi-kwarteng-mini-budget-key-points-at-a-glance or https://www.bbc.co.uk/news/business-62920969