The Perils of a Renewed Age of Austerity

The Perils of aRenewed Age of Austerity

Sascha Lavin explores why tax cuts promised by the Conservative leadership hopefuls are even more dangerous after 12 years of austerity

While Boris Johnson’s successor is yet to be selected by the Conservative Party, it is becoming increasingly likely that, whoever they may be, the next prime minister will reinstate austerity policies to fund their tax-cutting promises. 

As of last weekend, the Conservative leadership candidates had promised tax cuts collectively worth £200 billion – more than twice the annual budget of the NHS.

When former Prime Minister David Cameron announced that “the age of irresponsibility is giving way to the age of austerity”, he pledged that his package of extensive public spending cuts would “deliver more with less”.

Now, more than a decade later, Cameron’s assurances are little more than empty words: austerity didn’t deliver more with less, it delivered less with less. 

From hollowed-out youth services to legal aid cuts – few public services were left unscathed from Cameron’s budget slashes.

Over the decade of austerity, the number of emergency food parcels distributed by the Trussell Trust – the UK’s largest food bank charity – increased by 5,146%; rough sleeping in England soared by 165%; and 600,000 more children were in relative income poverty.

In the most severe cases, austerity has been a death sentence: Cameron’s programme of cuts can be linked to more than 50,000 extra deaths in five years, according to research by the University of York. 

Professor John Fender, who published the monograph ‘Austerity’, has warned that implementing a new package of extensive spending cuts to public services would be “extremely damaging, more so than the last round of austerity”.

“The low-hanging fruit has already been picked,” he told Byline Times. “Cuts that were (relatively) easy to make have already been made.”

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Hitting the Poorest, the Hardest

Despite Cameron’s Chancellor George Osborne protesting that “we are all in this together”, the north of England was disproportionately affected by his austerity measures, according to the Institute for Public Policy Research (IPPR) think tank.

Indeed, a Byline Times investigation found that ‘Red Wall’ constituencies in the north and the midlands bore the brunt of public spending cuts.

From 2014/15 to 2019/20, the percentage of children in poverty increased in English Red Wall seats by 16%, while nationally this figure was 8%. Those eligible for free school meals in Red Wall areas also outstripped the England-wide average: 23.2%, compared to 19.9%. And social care spending fell in real terms in these constituencies by 23.8% between 2010/11 and 2018/19, while the England-wide social care budget dropped by only 16%. 

As Sam Bright observes in ‘Fortress London’, seven of the 10 cities that experienced the largest spending cuts from 2009/10 to 2017/18 were located in the north-east, the north-west or in Yorkshire. On average, cities in the north suffered spending cuts of 20%, compared to cuts of 9% in the east, south east (excluding London) and the south west.

Barnsley was the city hardest hit by austerity – experiencing a reduction in funding of around £145 million (40%), or £688 for every resident. On a per capita basis, Liverpool was the worst affected, its £441 million spending cut equating to £816 for every person in the city.

Perhaps it is because no leadership candidate looks likely to win back Red Wall seats that they have unanimously chosen to ignore how tax-cuts will only level-down public services in areas already in desperate need of a cash boost. 

But it is not just those living in Red Wall areas that shouldered the burden of Conservative public spending cuts.

“Austerity policies since 2010 hit poorer people harder than rich people,” Mary-Ann Stephenson, director of the Women’s Budget Group, told Byline Times. “They hit women in every income group harder than men and black and minority ethnic women, disabled women and lone parents hardest of all.”

Research by the group found that black and Asian households with the lowest-fifth of incomes experienced the biggest drop in living standards during the decade of austerity, while 86% of the cuts to public spending between 2010 and 2017 was from spending which previously went to women. 

“Further cuts to public spending will have a disastrous impact on these groups; they already have lower levels of savings, higher levels of debt and are most affected by the rising cost of living,” Stephenson said. “Tax cuts will largely benefit the better off. Combined with cuts to spending, they mean a further transfer of money from the purses of poorer women to the wallets of richer men.”

If the next Conservative prime minister chooses to re-invigorate austerity policies, past spending retrenchment will be compounded, and those who were hit hardest by the first age of austerity will feel the cuts most acutely again.

This time around, however, they will be even worse-off, having not yet recovered from David Cameron’s cuts. Indeed, wage levels across the board are lower in real terms than before the 2008 financial crash.

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‘One Disaster After the Next’

The Coronavirus pandemic is far from over: the number of people infected in the UK has more than doubled since the start of June, with one in 25 people in England now testing positive, according to the latest Office for National Statistics data.

But, as the Conservative hopefuls pledge to pursue tax-cutting policies, which can only be funded by drastic cuts to public services, they appear not to have learnt a valuable lesson from the pandemic. 

Over the past two years, the UK’s Coronavirus response has been thwarted by a decade of austerity measures. George Osborne’s cuts left the NHS “extremely fragile” at the onset of the pandemic, according to the IPPR, with an £850 million real-term reduction in public health grants over a three-year period from the 2015/16 financial year.

For Sir Michael Marmot, who wrote an eponymous landmark report on health inequalities in 2010, the age of austerity created “one disaster after the next” during the pandemic, putting lives at risk.

“It meant doctors working in unfamiliar roles desperately trying to cope with rocketing numbers of COVID-19 patients in potentially unsafe environments, £1.5 billion emergency funding for field-style Nightingale hospitals and wanton encouragement of hasty discharge from hospitals into care homes and the community to free up beds – encouraging a rapid spread of the virus,” he said. 

A high-austerity prime minister will weaken the NHS at a time when fully-funded and fully-functioning healthcare is needed in the ongoing fight against Coronavirus and to deal with persistent NHS backlogs. 

Slashing public spending will hit the services, the areas and the people already left worst off by Cameron’s age of austerity. After a decade of cuts, an ongoing pandemic and a cost of living crisis, what fat is left for the next prime minister to trim?