Ethnic minority Britons will be disproportionately affected by Conservative cuts

Minority Britons can expect to see a widening racial gap in the British economy


When George Osborne presented the Conservative Budget to parliament a few weeks ago it received a critical review from many corners of civil society. But what has received less coverage is the fact that some are going so far as to call it outright racist.

A recent report put together by Omar Khan, director of racial equality think-tank The Runnymede Trust, has built a compelling case suggesting this new budget will disproportionately hurt Black and Ethnic Minority (BME) communities.

Through a system of tax credit and welfare reforms, it seems that minority Britons can expect to see a widening of the already significant racial gap in the British economy.

So how will the budget hurt BME groups?

Here are just a couple of reforms that will be sure to increase burdens on BME populations and benefit the white population.

An increase in the inheritance tax threshold

With Osborne’s new budget, the inheritance tax will no longer take effect until assets reach up to £1 million. Right now, the average White British household holds around £221,000 while Black African households hold only £21,000, and Bangladeshi households hold £15,000.

Because of this already stark gap, very few BME families can hope to receive any benefit from this provision. To be fair, most White households will not benefit from this either, but it’s much, much more likely than for BME households.

Child Tax Credit reform

Did your family decide to have more than two kids? If so, you’ve surpassed the new limit, and you can expect to see a cut to your income via an amended tax credit system. This has a hugely disproportionate impact on Black and Asian families, 24 per cent of which have more than two children, whereas only 8 per cent of White families have more than two children.

Khan points out:

While ethnic minorities form around 11 per cent of households and 14 per cent of the UK population, we expect them to be over 15 per cent of households and around 25 per cent of individuals worst affected by the budget – because of their younger age, higher child poverty, lower wages, fewer pensioners and greater part-time working.”

Individuals and families with a Bangladeshi background can expect to be affected most negatively by the new budget. The study finds that about half of the Bangladeshi population,which totals about 225,000 people, will lose out by about £1,000.

Was this an oversight on the part of CCHQ and senior figures in the Conservative Party who put together and approved this new budget?

It’s hard to say for sure. But a spokesperson for the Treasury claimed: “HMT has fully considered equality impacts on different protected groups”. If this is true, then Osborne needs to hire better policy researchers.

Varinder Singh is a councillor in the London Borough of Redbridge and works for an MP

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