“Cheering for projections and squabbling over growth figures will not disguise that living standards are dropping, bills remain unaffordable and continue to rise, and our failing public services are being starved of investment. The cost of inequality crisis is entrenched and today our politicians had an opportunity to deliver on their promise for long-term thinking and real change. Instead, they are once again out of touch and failing to tackle the root causes of our problems: high inequality, underinvestment, and a system rigged to reward those with wealth and power.”
– Priya Sahni-Nicholas, Co-Executive Director
Today’s autumn statement seemed like an attempt to paper over a crisis. Reductions to inflation were cheered and planned cuts to National Insurance was celebrated, but the truth is that energy bills are 49% higher and food bills 29% higher than 2 years ago and the earlier freezing of National Insurance thresholds mean that we’re still paying more than we were 2 years ago. Overall, today again showed that our political class are unwilling to face the crisis we’re in.
We were pleased by the decision to invest some more money into HMRC, especially when cuts to HMRC had been suggested several times. We now need this to go further; the estimated £5bn this could raise is dwarfed by the £12.5bn lost through corporate profit-shifting alone. Similarly, plans to uprate Local Housing Allowance, which has been frozen since 2020, were long overdue, as were plans to uprate benefits overall with October’s inflation; increasing them by 6.7%. However, this merely goes some – and absolutely not all – way to restoring benefits to the level they were at. Benefits should cover, at the very least, the essentials needed for life. Olivier De Schutter, the UN’s special rapporteur on extreme poverty recently described the UK’s Universal Credit system as “grossly insufficient” and as “a leaking bucket”. Unfortunately, this remains the case.
These overdue increases to benefits are coupled with punitive sanctions on those trying to access them. Plans to force recipients onto “mandatory work placements” failed before during the coalition years, giving exploitative corporations free labour; revived plans will likely fail again for the same reason.