Budget Statement

Baroness Donaghy Excerpts

Monday 4th December 2017 Lords Chamber

[Baroness Donaghy (Lab)]

My Lords, it is a great pleasure to follow the noble Lord, Lord Dobbs; he is a great fiction writer. [Laughter.] My contribution will cover housing, rather briefly as other noble Lords have covered this, and the impact of the Budget on women.

As David Smith, economics editor of the Sunday Times, has said, the figure announced of 217,350 net additional dwellings in England in 2016-17 includes thousands of conversions where commercial properties and houses are converted into flats. Interestingly, it also includes caravans and houseboats, so now we know the direction of travel. The actual figure for England was more like 140,850—so no cheating, please. The Government’s target is not achievable under current policies even if we had the capacity to build, and the serious shortage of skills proves that we do not.

I rather like the Resolution Foundation’s suggestion for how the scrapping of stamp duty could have been better spent: the 3,500 first-time buyers who stand to benefit should have been handed £160,000 each to buy a property outright in 26% of local authorities across England and Wales. Then they would have been mortgage-free. Put another way, the cumulative cost of £3 billion over five years would have built 40,000 homes for social rent or 100,000 through the Government’s own Housing Infrastructure Fund.

I turn to the impact of the Budget on women. Women benefit most from social security protection rather than tax cuts. They rely more on health services and social care, and are lower paid than men. There was nothing in the Budget on social care, as has been said, and that is staggering. It is simply not good enough to say that it was dealt with in the Spring Budget, when that allocation was a drop in the ocean. There was nothing in the Budget about how the self-employed interact with the social security system. The Treasury is responsible for the difficulties of those self-employed on low incomes and who have fluctuating earnings. They are adversely affected by the minimum income floor, and the majority of the newly self-employed are women.

I do not know if it is a government tactic or just coincidence but when individuals and organisations carry out a comprehensive impact assessment on women and the Budget, they are told that they are wrong and do not take account of other factors. Last week I raised the issue of a household with one disabled adult and one disabled child being £5,500 per year worse off under this Government. The figure came from the Equality and Human Rights Commission. The Minister, the noble Baroness, Lady Buscombe, said the figures were skewed. In answer to a question by Gerard Killen MP, Secretary of State Justine Greening questioned the accuracy of the analysis of the effect of government policy on women that was conducted by the Women’s Budget Group and the Runnymede Trust. The Minister said:

“The analysis … does not take into account the impact of the national living wage”—


it did—

“the changes we have made to childcare”—

it did—

“the work that we are doing on reducing the gender pay gap”—

she gave no evidence for that—

“the introduction of shared parental leave”—

she gave no figures—

“or the introduction of increased flexible working”—[Official Report, Commons, 23/11/17; col. 1167]—

but she gave no impact assessment. We have a game of hide-and-seek going on: the Government do not produce a full impact assessment themselves, but anyone else who tries to do so is batted off with a series of declamatory statements.

The Women’s Budget Group has written to the Secretary of State emphasising the need to consider the impact of cuts to public services alongside changes to taxes and benefits. The group has offered to discuss its comprehensive analysis with the Minister and has asked the Government to produce their own analysis in the same level of detail. The analysis by the Women’s Budget Group and the Runnymede Trust reveals that low-paid workers, mainly women, were hardest hit by the 2015 and 2016 changes to universal credit. Employed women will lose £1,400 of their yearly income by April 2021, compared with the original design of universal credit. Such a cut endangers the integrity of the universal credit framework.

Two other aspects of universal credit directly discriminate against women. Payment of universal credit to one person in an English household will risk increasing women’s financial dependence on their partners and make them more vulnerable to financial and other abuse. The two-child cap and abolition of the first-child premium with effect from 6 April 2017 means that women will have to stretch that income, possibly to breaking point.

I do not know whether the Government meant it as a crude form of birth control, a form of saving public money or a warning-shot across the bows that even worse is to come, but this is a slow burner, and a large number of people who will be affected in future are not aware of it. By the way, a healthy birth rate is essential if we are to maintain a healthy tax take. Watch this space.

Because of the gender gap in higher earnings, raising the higher-rate threshold disproportionately benefits men—73% of them. Only 27% of women were higher-rate taxpayers in each of the past five financial years. The Women and Equalities Select Committee has expressed disappointment in the Treasury’s record on providing evidence of how it had met its statutory obligations under the public sector equality duty and called for an independent evaluation of the Treasury’s performance. No one will be surprised that no such independent evaluation has been commissioned, nor has the Treasury published its own equality impact assessment.

The Chancellor may have tried to play safe in his pedestrian Budget, but he has done nothing for the millions of people who are disadvantaged, or the millions of women who have to pick up the pieces.