Wednesday, 20 October 2010

Initial thoughts on the CSR announcement

George Osborne announced his Comprehensive Spending Review - we'll do a more considered response in time, but a few initial thoughts:

  • We're told this CSR will be fair and hit the richest hardest ... he said that last time. It's not true this time either.

  • The Government will invest £900 million in HMRC can bring in £7 billion in tax evasion. Spending 90p gets you £7, that's a good return on investment. There's a £120 billion tax gap - maybe invest a bit more?

  • Raising the state pension age to 66 will have a disproportionate impact on the poorest who have shorter life expectancy and are less able to afford to retire early

  • Osborne implied that public sector pension costs are rising. In fact the costs are falling as the Hutton report showed

  • the new 'Work Programme' (workfare/welfare conditionality) will be entirely delivered by the private and voluntary sectors with payments by result (profiting from welfare) even though the DWP's own research shows Jobcentre Plus staff more effective and efficient

  • The extra £7 billion cuts in welfare, on top of £11 billion announced in June, is effectively taking £1000 from 18 million people

  • Another attack on housing benefit - this time people under-35 targeted, and their housing benefit will be effectively halved. Disgusting.

  • Further attacks on Working Tax Credits, including reducing childcare element

  • George Osborne said "the Spending Review has no measurable impact on child poverty over the next two years" as if that was something to be proud of?! Also the CSR period is 4 years so what about the last 2 years? There are over 3m children living in poverty ...

  • "By cutting business taxes we are giving business the freedom to compete" - what a load of nonsense

  • Administration budgets across departments will be cut by 34%, overall expenditure down 19% - 490,000 job cuts across public sector as Danny Alexander 'told' us yesterday

  • Train fares will rise 3% above RPI inflation for the next 3 years - RPI is currently 4.6% - FFS nationalise!!

  • He used "will be protected in cash terms" a lot - what that translates as is a real terms cut.

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