Tag: welfare cuts

RACHEL REEVES: We will deliver security for working people and renewal for Britain

BRITAIN’S POOREST COMMUNITIES FACE MORE HARDSHIP

  • Chancellor vows to bring about “security and national renewal” as she delivers a Spring Statement to kickstart economic growth, protect working people and keep our country safe.  
  • Reeves will warn that “we have to move quickly in a changing world”, unveiling a significant step towards spending 2.5% of GDP on defence with £2.2 billion funding boost next year.  
  • Growth and national security at heart of Plan for Change as funding invested in cutting-edge weapons and better homes for thousands of military families – paid for by reductions to international aid budget and from the Treasury reserve.  

The Chancellor will promise to deliver “security for working people” and a “decade of national renewal”, as she reveals how the Government will put advanced weaponry in the hands of British troops, provide better homes for military families and kickstart economic growth through the Plan for Change.   

At today’s Spring Statement, the Chancellor will announce a further £2.2 billion funding increase for defence from April, as she warns that Britain has to “move quickly in a changing world”. 

The funding will be invested in advanced technologies so that Britain’s armed forces have the tools they need to compete and win in modern warfare. This includes guaranteeing the investment to fit Royal Navy ships with Directed Energy Weapons by 2027. These weapons can hit a £1 coin from 1km away and take down drones at a distance of 5km.  

It will also be used to provide better homes for military families by refurbishing the defence estate – including over 36,000 homes recently brought back into public ownership from the rental sector. In addition to this, the funding will unlock rapid preparatory work, such as site surveys, planning and architecture, for the major redevelopment of Armed Forces housing through the Defence Housing Strategy.   

The investment will also help fund upgrades to infrastructure at His Majesty’s Naval Base Portsmouth, securing its ability to support Royal Navy operations into the future.   

Speaking in the House of Commons today, Chancellor of the Exchequer Rachel Reeves is expected to say: “This government was elected to change our country.

“To provide security for working people. And deliver a decade of national renewal. 

“That work of change began in July – and I am proud of what we have delivered in just nine months. 

“Restoring stability to our public finances; giving the Bank of England the foundation to cut interest rates three times since the General Election; rebuilding our public services with record investment in our NHS and bringing down waiting lists for 5 months in a row; and increasing the National Living Wage to give 3 million people a pay rise from next week. 

She will add: “Now our task is to secure Britain’s future in a world that is changing before our eyes. The job of a responsible government is not simply to watch this change. 

“This moment demands an active government stepping up to secure Britain’s future. A government on the side of working people. 

“To grasp the opportunities that we now have and help Britain reach its full potential, we need to go further and faster to kickstart growth, protect national security and make people better off through our Plan for Change. 

She will also say: “In February, the Prime Minister set out the government’s commitment to increase spending on defence to 2.5% of GDP from April 2027 and an ambition to spend 3% of GDP on defence in the next parliament as economic and fiscal conditions allow.

“That was the right decision in a more insecure world, putting an extra £6.4bn into the defence budget by 2027. But we have to move quickly in a changing word. And that starts with investment. 

“So I can today confirm that I will provide an additional £2.2bn for the Ministry of Defence next year – a further downpayment on our plans to deliver 2.5% of GDP. 

“This increase in investment is not just about increasing our national security but increasing our economic security, too. As defence spending rises, I want the whole country to feel the benefits.” 

The plan will include action to harness the ingenuity of Britain’s leading manufacturing and technology sectors, creating jobs across the country and putting more money into people’s pockets.   

The increase set to be announced today follows the extra £2.9 billion announced for defence in the Autumn Budget and takes spending as a proportion of GDP to 2.36 per cent in 2025/26 – up from 2.3 per cent in 2024/25.   

The announcement is fully funded. The new money comes from in-year funding from the Treasury reserve and from changes to the Overseas Development Assistance budget, so will not require additional borrowing and will maintain the Chancellor’s ironclad fiscal rule. 

Further detail on the Ministry of Defence’s investment plan will be set out via the Strategic Defence Review in the Spring and the Spending Review in June.   

Commenting on the increase in defence spending, Defence Secretary John Healey said: “National security is the bedrock of a successful economy and our Plan for Change. This significant increase in defence spending, on top of the £2.9bn announced by the Chancellor at the Budget, means an extra £5 billion for our Armed Forces next financial year. 

“This investment will make Britain stronger and safer in a more insecure world. And it will ensure defence is an engine for growth, creating good jobs across the nation. 
 
“These are the bold first steps of the largest sustained increase in defence spending since the Cold War announced by the Prime Minister last month. Our government is delivering for defence and investing in the outstanding men and women who keep Britain secure at home and strong abroad.” 

Scots say: Increase taxes on the richest, rather than make cuts to public spending

CHANCELLOR EXPECTED TO SLASH WELFARE IN SPRING STATEMENT

New polling reveals people in Scotland would overwhelmingly prefer the very richest to pay more in tax rather than see cuts to public spending, as parallel Oxfam analysis shows the UK’s wealthiest people continue to amass even greater fortunes.

It comes as new number crunching by Oxfam, Patriotic Millionaires UK and Tax Justice UK finds that UK billionaires have seen their fortunes swell by £11 billion in the past 12 months alone – the combined amount the UK Government plans to cut from international aid and social security entitlements for people in the UK with disabilities or illnesses.

Campaigners say the data shows the UK Government’s recent cuts are not about financial scarcity, but rather about political priorities, and they sharply contrast with public opinion.

The polling, carried out ahead of the Spring Statement by YouGov on behalf of Oxfam, shows that people aged over 16 in Scotland strongly back action to fairly tax the wealthiest:

  • 68% think the very richest should pay more in tax.
  • More than three-quarters (79%) would rather tax the very richest than see cuts to public spending.
  • 79% support a new 2% wealth tax on assets worth more than £10 million.

The findings pile further pressure on the UK Government to introduce wealth taxes on the richest millionaires and billionaires.

Tax justice campaigners have identified a series of fair tax reforms and loopholes that could be closed to raise additional revenue. They say that a 2% wealth tax alone, applied to assets worth more than £10m, could raise up to £24 billion annually or around £460 million a week while only impacting 0.04% of the population – around 20,000 people.

For illustrative purposes, if the 2% wealth tax on assets over £10 million was introduced now, UK billionaires would still have seen their personal wealth soar by an average of £141 million each – a total of nearly £7.5 billion combined – since this time last year.

The money raised could be used to reduce poverty and inequalities, strengthen public services, including the critical care sector, and boost climate action, instead of padding the pockets of the super-rich while deepening economic, gender and racial inequalities.

Jamie Livingstone, Head of Oxfam Scotland, said: “We all feel it in our bones: it’s indefensible that public spending to support those in poverty and crisis is being slashed, while private wealth is quietly stashed away.

“People in Scotland are crystal clear: they’d rather tax the richest than see cuts to public spending. Yet the UK Government has chosen to snatch £11 billion from the pockets of those who need it most while the same amount has been added to the bloated bank balances of those who need it least in just 12 months.

“It’s time for the UK Government to put fairness first; tax the super-rich and protect people in poverty. The choice is that simple.”

Mark Campbell, entrepreneur and member of Patriotic Millionaires UK, said: “As a millionaire I know the economy is working for a few people like me and working against the vast majority.

“Spending cuts are short-sighted and will only increase the worries of millions of people in the UK who are struggling to put food on the table and heat their homes.

“Meanwhile, the very richest people in our society are watching their wealth grow exponentially. It seems outrageous that the wealth of the richest is taxed at a much lower rate than the income of working people who will bear the brunt of these budget cuts.

“A wealth tax is a very clear alternative. Given that most people want higher taxes on the very richest, and plenty of millionaires – people like me – also want it, what’s stopping the UK Government?”

As part of Tax Justice Scotland, a campaign backed by more than 50 diverse civil society organisations, think tanks, trade unions and academics, Oxfam Scotland is urging the UK and Scottish Governments to use their respective tax powers to fairly raise more money to enable greater investment in key poverty-reducing public services, like care, while combatting inequalities, and rewarding businesses that provide fair and flexible work – including for parents, and particularly women – while paying the real Living Wage.

Oxfam Scotland says the Scottish Government must also use devolved powers to help combat the growing gap between the wealthiest and those struggling to make ends meet, with the richest 10% having 217 times more wealth than the least wealthy 10%, and with record high income inequality.

Wealth inequality is not only deeply unfair, but a barrier to reducing poverty. It exacerbates social and environmental harms, fuels wider inequalities – such as those related to gender and race, and drives a wedge between those with wealth and those without it.

Campaigners are calling on Scottish Ministers to use the devolved tax tools at their disposal, such as landing a fair tax on pollution-spewing private jets using Scotland’s airports and finally replacing the discredited Council Tax with a system to tax property wealth fairly.

Jamie Livingstone added: “Scotland’s political leaders can’t afford to wait for Westminster to make the fair and obvious choice to make the wealthiest pay their share.

“As we approach the 2026 Holyrood election, they would be fool hardy to ignore the public mood. People want to see real progress on fairness. Scotland has powers to tax wealth more fairly to combat runaway inequality and to build a better and greener country, it’s time to use them.”

Ben Macpherson: ‘Delivering on our commitment to ensure every child has the best start in life’

Best Start Foods payments are increasing this month marking the achievement of another commitment for the first 100 days of the Scottish Government.

Social Security Minister (and local MSP for Edinburgh Northern and Leith) Ben Macpherson paid a visit to Fresh Start’s Pantry on Ferry Road Drive at lunchtime to meet staff and customers who are benefitting from the payments.

The payment supports low income families to buy healthy food for children under the age of three, and forms part of the Scottish Government’s national mission of eradicating child poverty.

Best Start Foods is part of a package of five family payments administered by Social Security Scotland. It is made every four weeks on a pre-paid card to buy healthy food including eggs, milk, fruit, vegetables and pulses. The payment is increasing to £18 from £17 during pregnancy and for any children between one and three years old. It’s also increasing to £36 from £34 for children under one.

Between December 2018 when the first payment started and 31 May 2021, £60.8 million has been paid to 179,575 families for Best Start Grant and Best Start Foods -£16.7 million of these payments were for Best Start Foods.

Social Security Minister Ben Macpherson said: “Unwarranted welfare cuts by the UK Government and the impacts of the pandemic are putting even greater pressure on family budgets.

“It’s our priority to do everything within our power to eradicate child poverty across Scotland. We committed to increasing Best Start Foods within the first 100 days of this Government and we have swiftly delivered. 

“We have also delivered on our 100 day commitment to pay £100 as part of Scottish Child Payment Bridging Payments worth £520 in both 2020 and 2021. Families will now have received £200 for each eligible child this year, almost two years ahead of the planned full roll-out of Scottish Child Payment for older children.

“We are set to invest £77 million both this year and next through this measure which is expected to benefit around 145,000 children and young people in receipt of Free School Meals on the basis of low income.

“Families in Scotland now have a unique package of payments that will help them as their child grows and I encourage all families on low incomes to check what they are entitled to. There are many forms of support available to ensure every child in Scotland has the best start in life.”

Further information on all five family payment can be found by visiting:  

mygov.scot/beststart

Greens reveal extent of benefit cap carnage

GREEN REPORT: EXTENT OF HOUSEHOLDS HIT BY BENEFIT CAP REVEALED

The City of Edinburgh Council area has seen a rise of 302% in the number of households being affected by the UK government’s new benefit cap, new analysis by the Scottish Greens has revealed. Continue reading Greens reveal extent of benefit cap carnage

Holyrood calls for halt to welfare cuts

Two children on deprived housing estate

The UK Government must use the Autumn Statement to reverse its freeze on benefits and the damaging reduction of the benefit cap, and ensure low income families will not face any further welfare cuts Finance Secretary Derek Mackay has said. 

He urged the Chancellor to reverse the further lowering of the benefit cap which came into force last week – which the Chartered Institute of Housing’s recent report estimates will affect up to 20,000 children in Scotland, and to reconsider the on-going freeze to working age benefits and cuts to work allowances in Universal Credit.

Mr Mackay also asked for confirmation that the UK Government will not add to the welfare cuts already planned to be imposed on Scotland which are expected to reduce annual spending on social security by around £1 billion by 2020.

Mr Mackay said: “Low income families have faced the brunt of the UK Government’s damaging welfare reform agenda to date so it’s only right that the Chancellor provides some reassurance that they will be protected from further attacks in the Autumn Statement.

“The impact of cuts and changes to benefits over the last few years, alongside a discredited sanctions regime, has widened the poverty gap, left families on low incomes worrying about putting food on the table, heating their homes and paying their bills, and driven the rise in the need for foodbanks.

“With £1 billion expected to be annually cut from benefits by 2020 UK Government policies will plunge significant numbers of households into financial difficulties – the UK Government should recognise it has squeezed enough from the welfare budget and low income families.”

Social Security Secretary Angela Constance added: “We will continue to urge the UK Government to reverse changes to the benefit cap and the on-going freeze to working age benefits as it is harming our poorest households.

“We are already spending £100 million a year in mitigating the worst of the welfare cuts inflicted by the UK Government, including fully protecting people from the bedroom tax. This is money which would be far better spent on lifting people out of poverty.”

Continue reading Holyrood calls for halt to welfare cuts

Swinney calls for welfare cuts U-turn

The Chancellor should use next week’s UK Budget to revisit welfare reforms which stand to place real strain and hardship on Scottish families, Finance Secretary John Swinney said today. Writing to the Chancellor ahead of Wednesday’s Budget, the Finance Secretary has highlighted the impacts in Scotland of the UK Government’s welfare reform programmes.

The letter sets out Scottish Government analysis which shows, for example, that whilst the bedroom tax will save the UKG money, this will be outweighed by the costs imposed on the Scottish economy. Over time the policy will remove £110m from the economy, through its impact in Scotland alone. This does not capture the wider social costs of the policy nor the distress and disruption that it will cause.

The letter also highlights that the full package of welfare reforms will present significant financial and operational challenges for all layers of government in Scotland. In his letter to the Chancellor Mr Swinney urges the UK Government to:

  • Provide immediate support for investment and jobs
  • Withdraw its bedroom tax policy
  • Take action on the distribution of European Structural Funds (ESF)
  • Improve access to finance for small and medium sized enterprises
  • Devolve responsibility for Air Passenger Duty to the Scottish Parliament

Commenting on his letter Mr Swinney (pictured below)  said: “Since 2010 the UK Governments fiscal policy has been premised on the need to maintain market confidence and the UK’s AAA credit rating. The Chancellor has chosen austerity over investment in growth and jobs and the cost has been the continuing deterioration in the public finances, prolonged recession and the downgrade of the UK’s credit rating.

“That cost is increasingly borne by the most vulnerable in our society and public services in Scotland urgently seeking to mitigate the worst impacts of the UK’s disastrous welfare reform programme. Scottish Government analysis shows that based on reasonable assumptions the projected UK Government savings from the bedroom tax are significantly outstripped by the net loss to the UK of over £100 million over the long-term. This policy is unfair, is unlikely to deliver savings in real-terms and cuts across devolved policies. The Chancellor should use his forthcoming Budget to withdraw it.

“While we welcomed the Chancellor’s partial recognition of the need for urgent investment to boost growth in the Autumn Statement. we again call on the Chancellor to use this Budget to provide a real stimulus and greatly expand capital investment With colleagues from Wales and Northern Ireland, I have also called on the Chief Secretary to the Treasury to invest in growth.

“Small and medium sized businesses are the lifeblood of Scotland’s economy. Growth will be led by the private sector yet it continues to be choked by half-hearted Coalition measures. Figures released last week on bank lending again confirm that the UK Government’s action to improve access to finance for the country’s small and medium sized businesses is failing to deliver. We continue to press the Coalition Government to go further and faster in improving access to finance.

“With the powers of independence Scotland would have the economic levers and the scope to tailor welfare policies in line with Scotland’s interests, to ensure that Scotland’s businesses and people no longer have to fund the failures of a UK Government.”

Swinney