The government’s autumn statement on 5 December 2012 will mark a vicious extension to its assault on the working class. Having announced in March 2012 that it would seek to cut a further £10bn from state welfare on top of the £18bn already planned, the measures it is now considering include:
- Stopping Housing Benefit for under-25s, affecting 385,000 people;
- Limiting child-related benefits for unemployed people to their first two children, affecting 310,000 families;
- Freezing benefits for two years from April 2013.
This is a savage attack, coming as it does on top of the third round of council cuts, cuts in housing benefit for those in social housing, and the introduction of the Welfare Benefits Act, all effective from April 2013. Robert Clough reports.
Council cuts
Throughout the country councils are now finalising plans for a third year of cuts in jobs and services. The average cut for the three years is £160 per head in the 50 worst-hit councils where the average child poverty rate is around a third. 43 of these are run by Labour. The 50 least-affected councils will suffer a total cut of £16 per head. 42 of them are Tory and on average have a 10% child poverty rate. It is the poorest councils which are being hit worst by the 28% cut in central government support over the three-year period. As each year passes the impact of the cuts grows more severe: Sure Start services reduced to nothing, libraries and day centres closed, charges for meals on wheels going up and up, respite care facilities slashed. However rich or poor the council, it is the working class, and working class women in particular, who bear the brunt both in terms of service cuts and job losses.
Labour leaders wring their hands, but in practice cooperate with the cuts programme. Shadow secretary for local government Hilary Benn complains that ‘the Tories and Liberals have targeted cuts in a way that doesn’t reflect the resources communities need’. Newcastle council Labour leader Nick Forbes says that ‘if this goes on, by 2018 we will see the end of local government as we know it’. This has not stopped him from putting his shoulder to the wheel: Newcastle will be cutting Sure Start programmes, closing ten libraries and the majority of its leisure centres (see p4).
The trade unions are as guilty of collusion as the Labour Party. Between January and September 2012, 234,000 days were lost in official strike action. Apart from the final whimper of opposition to the cuts in public sector pensions in May, only 86,000 days were lost in public sector strikes, fewer than the number of public sector jobs lost in the same period. Union leaders local and national may make fighting declarations but in reality they are caught. Strike action against a council budget would be a political strike breaching the anti-trade union laws and so imperil trade union assets. Furthermore, trade unions would have to challenge those councils where the cuts are hitting hardest – Labour councils. They will do neither.
Housing benefit cuts
From April 2013, swingeing cuts in Housing Benefit (HB) will come into effect for those living in council and other social housing. These measures are already in effect for those forced to rent privately. The regulations require a cut in HB of 14% of rent for households with one extra bedroom, and 25% of rent for those with two or more spare bedrooms. Children will be expected to share a bedroom up to the age of ten, and up to 16 if they are of the same sex. The changes will affect 660,000 or 31% of social housing tenants; this proportion rises to 43% in the North West. The average cut will be £13 per week, with 70,000 people suffering a £20 cut. It is estimated that between 66% and 72% of such households will include someone who is disabled. Claimants who have non-dependants living with them, typically adult children, will see HB cuts of 27% for each of the following three years.
Changes already in place to the Local Housing Allowance (LHA, payable to private housing tenants) mean that it is already set at the 30th percentile of local private rents instead of the mid-point; the LHA maximum is set at four bedrooms rather than five, with a cap on all rates for one to four bedrooms. Single tenants aged 25-34 no longer qualify for the single bedroom allowance, and may only receive the shared bedroom allowance, a cut of £41 per week for over 60,000 people. Overall the loss to the majority of private tenants is £10 a week, but 100,000 households are estimated to have lost £30 and more per week.
From April 2013 there will also be a 20% cut in Council Tax Benefit as the budget for it is passed down to local councils. Six million people receive it, with average payments £16 per week. As pensioners are protected, it is the unemployed and low-paid who will have to pay out more towards their council tax.
Welfare benefit cuts
From April 2013 benefits to out-of-work households will be capped at £500 a week for couples and £350 for single people. Housing benefit will be cut once the limit is breached. This will immediately affect about 100,000 households which will lose an average of £93 per week. From October 2013, Universal Credit will progressively replace the current benefit system. Since applications can only be made online, it will create problems for those with poor access to computers or limited skills or English. This will be compounded by a complex application process.
In addition, a system of Personal Independence Payments will replace Disability Living Allowance (DLA), an in-work benefit. The aim is to cut DLA payments by 20%, with an estimated 500,000 people losing the benefit altogether. Atos has won the contract for performing the required medical assessments across Scotland and most of England; Capita has won a smaller contract covering Wales and central England. The assessments will be calibrated to force people off any support whatsoever, complimenting the vindictive tests that Atos undertakes to remove disabled people from Employment Support Allowance.
Class war without end
The ruling class and its millionaire government are stepping up their all-out assault on the working class because they do not feel there is any opposition. The 20 October 2012 demonstration organised by the TUC was less than half the size of its protest in March 2011. The TUC may be ‘exploring the possibilities’ of holding a general strike, but everyone knows that this will not happen if there is the slightest danger of breaching the anti-trade union laws. Trade unions such as Unite and Unison will not break their alliance with the Labour Party and will therefore ensure compliance with Labour council cuts. Resistance must come from within local communities, just as it did during the anti-Poll Tax campaign. We need to take a stand now.
FRFI 230 December 2012/January 2013
