Lisa Forbes: Austerity is causing rising poverty

Lisa Forbes

Lisa Forbes

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This week, figures released by the Institute for Fiscal Studies show child poverty is on the rise, meaning a backwards slide in progress made in reducing child poverty in the 1990s.

Austerity is massively impacting on the poorest in society and yet the Chancellor is insistent there is more to come. In fact, another £12 billion is expected to be slashed from the welfare bill alone.

Working families are to be hit hard with yet more cuts to Child Tax Credits. As a mum, I know how expensive it is to raise children these days. Clothes, shoes, school uniforms and the cost of school trips and after school clubs and activities are just some of the extras parents need to find money for and it’s not easy. Do we really want to be a society where only the rich can afford the luxury of having children?

Of course, I understand there is a need to reduce the deficit, but when most of those benefits the Chancellor wants to slash are paid out to those already in work, surely the best way to reduce the deficit is to make sure work pays and that people are earning a decent Living Wage.

Housing benefit accounts for a huge chunk of welfare spending, this isn’t money paid to people to enjoy a lavish lifestyle. This is money payable to landlords to ensure people have a roof over their heads. It isn’t difficult to see the discrepancy when an average 3 bed house in the private rented sector nowadays will set you back about £700 per month or £8400 a year in Peterborough. That is certainly unaffordable on a minimum wage of £6.50 per hour and even if you are fortunate enough to earn an average wage that is a significant portion of your wages in rent, hence the need to top people’s income up to ensure they have enough to live on, resulting in a rising welfare bill.

The fact rents are so high is not the fault of the average working family – the answer must lie in building more housing, because whilst demand is so high, rents will inevitably carry on rising. This government’s answer to the housing crisis is to sell off more social housing amongst other gimmicks which cause house prices to rise further still and will do nothing at all to reduce the deficit. There is no plan to build a new house for every social house sold. The fair and reasonable way would be to build the affordable housing we need and in turn reducing payments of housing benefit allowing the deficit to fall naturally.

Another way to raise the tax revenues we need to reduce the deficit and make sure children and families are not bearing the brunt of cuts would be to make sure businesses are paying tax on the profits they make in this country, so it was extremely difficult to swallow when I read the news this week that the UK government was being attacked by a US official for ‘’undermining progress on a global clampdown on tax avoidance by multinationals. Efforts to prevent companies shifting profits across borders to avoid taxes are said to have amounted to a “collective failure” due, in part, to self-interested moves made by Cameron’s government’’.

That just about sums up this government. Ideological cuts hurting those who can least afford it, whilst helping their mates in the City.