Long-term cost of cuts

Published: 2 July, 2010

• ISLINGTON Law Centre works with some of the most disadvantaged people in the borough and it was with a sense of dismay that we learnt of the welfare benefit cuts in last week’s budget.

We believe that short-term cutting of welfare benefits will reduce the benefits bill.

However, there are long-term cost implications for the Department of Work and Pensions, the NHS and local authorities.

Restriction of the Sure Start maternity grant to the first-born child, removing the health in pregnancy grant and reducing free school meals will have a negative impact on the health of pregnant women, new mothers and young children.

This will have long-term health and educational impacts.

The proposal to reduce housing benefit payments for claimants receiving jobseeker’s allowance by 10 per cent after 12 months, from April 2013, will not help people to find work but will lead to homelessness.

The increases in tax credits will be offset by the increase in the taper (the percentage at which benefit is withdrawn) and will not be an increase for working parents.

The removal of tax credits from “higher earners” does not take into account the number and cost of children (especially disabled children) and will adversely affect many essential workers such as nurses who are not traditionally considered to be high earners.  

The linking of pensions to wages is welcomed. However, at a time when many wages will be frozen the actual increase in pensions may well be below the rate of inflation and will represent a cut.
LORNA REID
Islington Law Centre, N7