Third sector responds to poverty implications of autumn statement

Date: 29th November 2016
Category: Social security, Child poverty

Some measures in the autumn statement have been criticised by the sector because they do not go far enough to reverse the cuts already inflicted.

Marketed as being about helping those who are "just about managing", charities are united in saying that while some measures are welcome they do not go anywhere near far enough to reversing cuts already made and helping the poorest in society.

Hammond scaled back plans to reduce Universal Credit by changing the 'taper rate' from 65% to 63%. This means that workers will lose 63p rather than 65p for every pound that they earn above their work allowance.

The National Living Wage will rise from £7.20 per hour to £7.50, but this is less than the initial target.

Childcare will be exempt from changes to the tax system to reduce individuals taking 'benefits in kind' to lower tax liability.

John Dickie, director of Child Poverty Action Group in Scotland, said he was hugely disappointed that the prime minister didn't back up the rhetoric on supporting families who are 'just about managing'.

"The chancellor's lowering of the universal credit taper is a sticking plaster to family budgets that are haemorrhaging losses imposed on them by his predecessor's budgets," he said.

"Low income working families have been left thousands of pounds worse off and horribly exposed to rising prices.

"The rhetoric on just managing families will end up being meaningless if the UK government ploughs on with policies like cuts to work allowances within universal credit and the freeze on family benefits that are set to tip the just managing into hardship and push more children into poverty."

The Scottish Children's Services Coalition, which has long campaigned for extra spending to improve services for children with additional support needs (ASN), said while the increase in Barnett consequentials from infrastructure spending is to be welcomed, the Scottish Government's overall budget is still likely to fall in real terms over the next five years, meaning more cuts.

"These cuts in public services means that Scotland faces the prospect of a lost generation of children and young people with ASN, making it extremely difficult for the Scottish Government to close the educational attainment gap," he added.

"With an increasing number of those children and young people with ASN, now amounting to more than one in five of the pupil population, we urge the Scottish Government and local authorities not be pass on these cuts to services that care for the most vulnerable in our communities."

Responding to the Statement, Amy Woodhouse, Head of Policy at Children in Scotland, said:
"We were interested to see whether the pre-statement rhetoric about support for 'just about managing' families was met by actual commitments. Yes, childcare will be exempt from changes to the tax system, but that's effectively no change to the present arrangement. And yes, we have seen minimal positive changes to Universal Credit, plus slight increases in the Living Wage. But this will not have a significant positive impact on the lives of families in poverty.

"The Chancellor celebrated the lowest ever number of children being raised in workless households, and no doubt for some families finding work has meant additional welcome income. However, research shows that a large proportion of those families living in poverty are in households where at least one member of the family works. This is not something to be complacent about, and certainly not something that this Autumn Statement comes anywhere near to addressing."

• Read the Third Force News article on this here.
• Read about the prospect of Scotland 'losing a generation' of opportunities for children with ASN here.