A Budget in Tatters

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In this Rebuttal Blog:

  • Section 1 - George Osborne's budget black hole

  • Section 2 - Budget Failures in brief

  • Section 3 - Figures on the Tory record on Housing

  • Section 4 - Figures on the Tory record on Social Security

  • Section 4 - Figures on the Tory record on Education

  • Section 5 - Campaigning update

 

George Osborne's Budget Unravels Leaving a £4.4 Billion Black Hole

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  • Just 3 days after it was delivered the budget developed a £4.4 billion black hole through the scrapping of PIP cuts which is yet to be plugged.

  • The PIP cuts hitting disabled people were set to account for 1/3 of savings in the Chancellor's budget.

  • The new Department for Work and Pensions secretary has said the Government have 'no plans' for further welfare cuts, but have refused to give a cast iron guarantee.

  • In an unprecedented move the Chancellor accepted opposition amendments to his budget that is falling apart around him.

This week has been perhaps the most turbulent yet of this Tory Government.

We're now in an astounding situation where Ian Duncan Smith, by all accounts on the right wing of the Conservative Party, has resigned from the Cabinet because of, in his words, the Chancellor's "divisive" attack on "people who don't vote for us".
 
We are by now used to Osborne missing his targets, breaking his promises and delivering budgets that swiftly unravel, but this sets a new bar.
 
When in history has a Cabinet Minister gone on TV and said he was "progressively more and more depressed about the idea that we were running to an arbitrary budget agenda which had a welfare cap in it" and that the agenda has "become too focused on narrowly getting the deficit down without being able to say where that should fall other than simply on those who I think progressively can less afford to have that fall on them"?
 
Labour have long said that compassionate Conservatism under Cameron and Osborne is a farce, but now even an ex-Cabinet Minister and former Tory party leader is saying it too.
 
It's now up to Labour to show the extent of Osborne's budget chaos, his politically rather than economically motivated cuts weighing down on those least able to bear it, and his failing economic plan.

Osborne's Failed Budget in Summary

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George Osborne’s Budget is the culmination of six years of Tory failure and unfairness 

  • 1/3 of the savings in George Osborne's budget last week came from disabled people.

  • After the biggest and swiftest unravelling of a budget that has ever been seen Osborne has now been forced to drop the cuts to PIP and now has a £4.4bn hole in his budget that he will have to plug.

  • George Osborne promised to balance the books by 2015 but he has failed: we’re now in 2016 and there’s still no sign of him meeting his promise.

  • Just six months after setting himself a debt target, of decreasing the debt to GDP ratio year on year, George Osborne had to admit that he’s set to miss it, with debt to GDP rising to 82.6% in 2016-17.

  • The Government is set to borrow £38 billion more than George Osborne planned in November last year. 

  • Meanwhile public sector net investment is set to fall as a share of GDP over this Parliament and GDP growth, wages, productivity and business investment have all been revised down every year.

How are these "Compassionate Conservatives" doing on Housing?

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  • Despite the country being engulfed in a housing crisis George Osbornefailed to announce any new policies on housing in his budget. 

  • There are 200,000 fewer home owners now than in 2010.

  • Fewer homes were built in the last Parliament than any other peacetime government since the 1920s. 

  • Homelessness has increased by one third since 2010.

  • The number of homeless families is set to reach almost 400,000 by 2020.

  • New 'Pay to stay' reforms to council housing will mean thousands of low and middle-income families risk being priced out of their homes.

  • The Government says it is committed to helping people into work but this policy penalises people who take on extra hours, meaning if they work a bit harder and earn a bit more that they could end up losing their home.

 

Tory record on Social Security 

Benefit Cap

  • "The problem was the institution of a welfare cap which was lowered directly after the last election pretty arbitrarily."

  • "I progressively got more and more depressed about the idea that we were running to an arbitrary budget agenda which had a welfare cap in it."

  • These damning quotes about the unfair, political and arbitrary nature of the welfare cap come from none other than the previous Work and Pensions Secretary, Ian Duncan Smith.

Bedroom Tax

  • The Court of Appeal has declared the hated Bedroom Tax 'discriminatory'.

  • The Government have spent hundreds of thousands of pounds fighting this and other cases brought against it by disabled people who have been hit by the bedroom tax.

  • 80% of people hit by the Bedroom Tax regularly run out of money by the end of the week or the month.

  • 75% of people who have lost out from the Bedroom Tax have not received any support from Discretionary Housing Payment fund that was supposed to ease the pain.

Universal Credit

  • In November the Government pretended to U-turn on tax credits but instead but the cuts into Universal Credit

  • The IFS has shown that – due to the government’s cuts to Universal Credit – 2.6 million working families will be £1,600 a year worse off by 2020.

 

Tory Record on Education

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School Places

  • House of Commons Library analysis has found that one in six secondary schools are already at or overcapacity and forecasts show there will be more than 300,000 additional secondary school pupils in the system by 2020.

Academisation

  • Analysis of the Budget shows that the schools system is facing a black hole of £560 million, as Osborne fails to fully fund his pledge to turn every school into an academy.

  • There are currently 15,632 schools in England which are not yet academies. The costs for conversion to academy status is £44,837. 

  • The Budget allocated £140 million to academisation. This leaves a shortfall of £560 million. 

Education Spending

  • Under the Tories, capital spending on education fell by 34% in real-terms over the parliament and post-16 education was cut by 14% in real terms, with the sector set to experience further reductions. 

  • The Tories try to say schools budgets are protected, but schools are facing a cut of 8% per pupil in real terms over the next five years, according to the IFS – the equivalent of £364 per pupil. The last time schools experienced a real-terms cuts was in the mid-1990s.

  • The introduction of a new funding formula will create winners and losers. It has been estimated that London schools alone will lose out on £260 million as a result. 

Teacher shortages

  • For four years the Tories have missed their target for recruiting new trainees into the profession. It is subjects that are key to boosting our country’s competitiveness, such as maths and science, which are among the worst hit. The total number of trainees recruited for 2015/16 is 7,000 fewer than in 2009/10.

  • Between 2011 and 2014 the number of teachers leaving the profession increased by 11 per cent, and the proportion of those who chose to leave the profession ahead of retirement increased from 64 per cent to 75 percent.

  • The amount schools are spending on supply teachers continues to rise and now stands at £1.3 billion – a rise of almost £300 million (27.1%) over the past two years.

 

Campaigning

The issues covered in this email are just a small sample of the terrible things this Tory government is doing to our public services and our communities around the country. Using these facts and figures to take them on is crucial, but the ultimate way to stop them and to make positive change happen is to get Labour party members elected as councillors, PCCs, Scottish and Welsh Assembly Members and MPs. The elections on May 5th are a chance to do that and it's incumbent on all of us to go and campaign for our Labour representatives and candidates. In the last weeks I've been campaigning in London, the West Midlands, Yorkshire and many other places.

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As a member of the Shadow Cabinet and National Executive Committee I’m always keen to hear your views and suggestions about our campaigning work against the Tories, or on any other issues. If you've any thoughts about how we are doing, or how we could do better, please do get in touch with my office at sarah_coombes@labour.org.uk.
 
I also spend lots of time visiting local Labour parties around the country, talking about the kinds of issues in this email and the ways we can campaign against the Tories nationally and locally. If you'd like me to come and speak at your CLP please do get in touch with my office.

You also can be added to my mailing list by clicking this link: http://eepurl.com/bHhZXT

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