The Tory Chancellor’s latest Budget has not ended austerity, although the Tory press and the BBC will probably repeat the propaganda tricks from Conservative Party HQ claiming ‘it is coming to an end’.
The reality is the Tories have presided over the longest falling in living standards since Victorian times. Even Hammond forecasts only miserably low growth over the next 5 years. This Budget does nothing fundamental to reverse that.
There are two main aspects to austerity. The first is the actions of the Government, which from the outset in 2010 cut public sector pay and pensions, cut funding for public services and cut taxes for big business, while raising VAT which is mainly paid by average earners and the poor. Cutting income tax allowances mainly benefits the higher paid. The government also cut public investment sharply.
The second is the actions of private sector employers, who have themselves cut pay in real terms, cut terms and conditions, pushed 800,000 people on to zero hours contracts, and millions more into increasing long, unpaid hours. Big companies have cut productive investment ‘because they have no money’ yet line up eager to participate in new privatisations.
This is a double-whammy of austerity from the private sector and successive governments operating on its behalf. Yet all of the enforced cuts to real wages to boost, the cuts to Corporation Tax and the giveaways of privatisation have not led to an increase in business sector investment. Business investment is falling once more, falling in the first half of this year. Austerity will continue until business have driven up profits for their own satisfaction. Or a new government ends it.
There are no substantial treats in the Budget. The ‘Green’ measures are a farce, with £60 million spent on trees, while there is a £9 billion giveaway from freezing fuel duty and £30 billion on road spending. Genuinely greener modes of transport such as public transport and rail get nothing. Universal Credit will continue to be rolled out but with a few tweaks, steamrolling over the poor, large families and the disabled.
Tiny additional funding will not tackle crisis in social care. It is not even a drop in the ocean compared to what is needed. As usual, it is not at all clear whether the promised funding for mental health funding comes out of the NHS budget. Hammond’s promised increased spending in NHS funding would not even cover the needed increase in pay for NHS workers.
There is nothing at all to end the general crisis of real pay in the public sector, where cuts are used to fund further tax cuts for big business and help drive down real wages in the private sector too. Despite all this, there is funding for increased military spending even though, as Hammond said Britain is already one of the biggest military spenders in NATO.
The austerity project is not ending. It’s not even close to ending. Incomes will still continue to be transferred from poor to rich, and from workers to employers. Campaigners, trade unions, social movements and political leaders opposed to austerity will need to increase their co-ordination and redouble their efforts to end it.
Our own new campaign ‘Britain is broken, we can’t afford the Tories’, is an important contribution to that effort, and we invite everyone to join it.