The reality of ConDem cuts: jobs & services are on the line

The TUC has launched Cuts Watch, mapping where spending cuts are made & considering their impact for jobs (public & private sec), for families & for communities.

The TUC has launched Cuts Watch, mapping where spending cuts are being made and considering their impact for jobs (in the public and private sectors), for families and for communities. Our analysis has made clear that frontline jobs and services are in the firing line. And although the Government has been keen to put a positive spin on the cuts the reality is that – across a range of policy areas – ‘new’ or recycled funding is dwarfed by larger funding reductions.

Emerging trends show us that:

Cuts are having the greatest impact for the worst off – cuts to affordable housing, to children’s services, legal aid and to the Child Trust Fund will inevitably have the greatest impact for those who already have the least.

Cuts are hitting the private sector as much as the public sector – despite talk of a private sector led recovery, groups including building, transport and IT contractors are expressing real concern.

Cuts will hit the economic recovery – programmes that are providing key support for the recovery have faced large spending reductions including funds for tackling youth unemployment, regional investment funding and investment in green jobs.

Announcements on ‘new’ investement do not take account of larger cuts.

While a gaping lack of detail remains on how the cuts will impact, it is clear that announcements on investment have provided cover for larger cuts:

• While the Treasury announced £170million spending in social housing, CLG were announcing £780 million in cuts – which have turned out to include £230 of cuts in home building programmes and a freeze on larger housing investment budgets;

• Although schools, Sure Start and 16-19 education spending are protected from cuts this year, ending the ringfencing of £311m education grants that are made to local authorities will inevitably affect children’s services; and

• Much was made of a £150m re-investment in apprenticeships – but at the same time £320million was being cut from support for unemployed young people, and £50milion was cut from training for employees and greater cuts made to higher education.

It is vital to chart these cuts. It is only by documenting their impacts that we can hold the Government to account, demonstrate that cuts are not possible without causing real social and economic pain and refute the emerging view that a bloated public sector – as opposed to a global recession – has somehow created the need for spending reductions.

Of course there are always savings that can be made, as is the case in all large organisations – but suggesting that the public sector is overwhelmed by unnecessary spending is a stance grounded in ideology and not fact. Employees, in public and private sector jobs, are not the only losers from cuts. Communities where they spend their incomes will feel the impact of reduced local demand, and the country’s 2.5 million unemployed people will feel the lack of public sector vacancies.

Those who suffer most will be those who are already in greatest need and are the most dependent on public services – older people who rely on home care services to help them cook, clean and remain in their own homes; homeless families waiting for affordable housing; young people who need extra help at school… As the detail of the cuts become clear, more and more examples are emerging.

Campaigning against cuts does not mean that we oppose deficit reduction – on the contrary we believe that immediate and sweeping spending cuts put the public finances at greater peril. The risks of a double-dip recession remain real, and even if growth continues spending cuts now risk slowing the recovery. Lower tax revenues, higher unemployment, increased social security spending – a recipe for sluggish growth and a further deterioration in the borrowing figures.

A key lesson from the 1980s was that austerity measures do not work – as the Thatcher Government took public money out of the economy, unemployment continued to grow, benefit spending increased (despite significant reductions in payment levels) and public spending remained high. Going for growth – across Europe – is the only viable means to get our economy back on a secure footing.

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