This website uses cookies for anonymised analytics and for account authentication. See our privacy and cookies policies for more information.

 




Supporting Scotland's vibrant voluntary sector

Scottish Council for Voluntary Organisations

The Scottish Council for Voluntary Organisations is the membership organisation for Scotland's charities, voluntary organisations and social enterprises. Charity registered in Scotland SC003558. Registered office Mansfield Traquair Centre, 15 Mansfield Place, Edinburgh EH3 6BB.

Osborne's political triumph will be a social and economic disaster

As the dust settles on the mounds of overblown budget analysis, we can only hope that it extends to the Chancellor’s love-in with the media. His easy ride on the Today programme this morning amply highlights how scared the BBC is running. To be fair, you have to acknowledge that Osborne has produced a brilliant political budget. It strengthens his position as he edges closer to becoming the next Tory leader and cuts the political ground from under Labour's feet. Beyond the political arena, however, the grim reality is becoming clear. As the Office of Budget Responsibility (OBR) states, this budget is 'financed by welfare cuts, net tax increases and three years of increased Government borrowing'.
Introduction of statutory living wage is Chancellor's biggest political con to date
The OBR's Economic & Fiscal Outlook report makes it starkly clear where the Chancellor's giveaway of £24.6bn in tax cuts will come from: £47bn of tax rises, twinned with £35bn of welfare cuts. So, to be clear, that’s not the £12bn we were all expecting - but £35bn. How many lives and communities will this devastate? Your guess is as good as mine, but one thing’s for sure: it will be the same people and communities who have already borne the brunt of previous cuts. The increase in demand for the third sector will be huge. We will have to try and help many more people in crisis as they struggle to get by. One thing which disappoints me the most is seeing how many people have been duped by the Chancellor's biggest ever political con to date: the 'introduction' of a statutory living wage. The current minimum wage is £6.50 and is set to rise by 20p in the autumn. Osborne’s new statutory living wage is £7.20 – a figure well below the recommended living wage of £7.85 (£9.15 in London). In fact, the only time that £7.20 was the living wage was back in 2011, and it was based on people receiving tax credits & housing benefit. What we see now is the behaviour of a charlatan, not a chancellor. All Osborne has done is simply create a higher minimum wage and give it a new name - an act that will bring loss, not growth, as people lose out on tax credits and housing benefit. The Tory war on tax credits will also backfire. The tax credit 'bill', as the Government sees it, will be hit hardest on the premise that it subsidises low pay and is the  a disincentive to work. The evidence that tax credits subsidise low pay is non-existent. In reality, tax credits encourage people to work and are a vital part of the solution to low pay, which our 'strongly growing economy', according to Osborne, is now based on. In fact, tax credits work both as an incentive to work and in alleviating poverty. As the Chancellor revels in his triumph, he should remember that a week is a long time in politics. His moment will be short-lived. The effects will be felt for much longer, as devastation hits the lives of millions of people throughout the UK. SCVO has prepared a full policy briefing on the budget and its implications for the third sector in Scotland. His budget will end up being remembered as a social and economic disaster.
Last modified on 23 January 2020