The Chancellor announced over the weekend that his second budget of 2015 will take place on 8th July – the first all Conservative government budget since 1997. The Budget, billed as the ‘budget for working people’, will implement the pledges made by the Conservative Party during the election campaign, notably a commitment to ‘balance the books’ by 2020. While this announcement has been widely reported, what has remained largely missing from the comment pages are the implications of the budget on the most vulnerable in society.
The Chancellor is expected to use the Budget to expand on the scale of spending cuts for public services announced under the Coalition government in the last Budget in March. And the axe is expected to fall sharpest on welfare payments, which the Party was reluctant to implement before the election. The Chancellor has also insisted the Budget will focus on raising productivity and living standards. But, while most would agree it’s better to get people back into work than living on benefits, there are also many people in work who do not earn nearly enough to sustain a basic standard of living and remain dependent on the welfare system to ensure an acceptable quality of life. It is these people, as well as the most fragile in our society, that will bear the burden of further welfare cuts. A report by the Centre for Welfare Reform has concluded that the disabled and those in poverty are particularly vulnerable to further reductions in welfare spending.
The Budget represents a key moment for the new Conservative government in its drive to move more towards the centre-right and is likely to reflect the manifesto it would have written during the last parliament had it then formed a majority government. The Government will also use the opportunity of the Queen’s Speech, scheduled for 27th May, to introduce distinctive Conservative pledges such as the so-called Snoopers’ Charter and the abolition of the Human Rights Act, which were blocked by the Liberal Democrats in the last government.
In addition to giving more details of the new government’s intent to cut £12 billion to the welfare bill, other announcements in the Chancellor’s Budget are likely to include a further increase in the income tax personal allowance (a popular policy first introduced by the Liberal Democrats), more apprenticeships and a crackdown on tax avoidance schemes.
The Budget on 8th July will be revealing. It will demonstrate the type of government the Conservatives will offer over the next five years. And it’s likely to demonstrate a willingness to shrink the State and take forward policies the Party was blocked from implementing by the Liberal Democrats. That will have consequences for the most vulnerable in society.