Kwarteng Rewards Wealthy MenWhile Punishing Poorer Women
The mini-budget is another worrying sign that the new Government is downgrading the importance of women’s rights, reports Sascha Lavin
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While the Chancellor unveiled a package of tax cuts on Friday that he claims are the most significant in a generation, those in part-time work were threatened with benefit sanctions.
Under plans set out by Kwasi Kwarteng in his mini-budget, benefit claimants working up to 15 hours a week will be pushed to take new steps to increase their earnings or face having their benefits reduced.
These new rules will disproportionately impact women, warns Dr Mary-Ann Stephenson, director of the Women’s Budget Group (WBG), as women make up the majority of the part-time workforce, juggling their jobs and caring responsibilities.
There is a clear gender divide in terms of caring responsibilities: women account for 85% of sole carers for children and 65% of sole carer for older adults, according to recent research by Ipsos and Business in the Community. And with that, according to Dr Stephenson, there is a gender disparity in the way wealthy men are perceived by the new Chancellor compared to women on lower incomes.
“There’s one group of people who are being designated as lazy and need to be punished into work,” she told Byline Times. “And there’s another group of already wealthy people who need to be given more money in order to encourage them to work more. The first group is largely women, and the second group – the already wealthy people – the majority of them are men.”
The current so-called administrative earnings threshold for Universal Credit is nine hours, though it was increased earlier this year by Kwarteng’s predecessor Rishi Sunak to 12 hours – a change that will come into force next week, before rising to 15 hours in January 2023 under plans announced on Friday.
People working under this threshold are subject to an ‘intensive work search regime’, which requires weekly or fortnightly meetings with a job coach and a requirement to spend up to 35 hours job hunting a week.
About 120,000 people are estimated to be affected by the new 15-hour threshold.
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Announcing the mini-budget, Kwarteng said “we need to encourage people to join the labour market”, but the WBG warns that far from achieving this goal, the Chancellor’s plans will merely penalise women – because he has not fixed the underlying barriers preventing women from working longer hours. These include a lack of adequate child care, social care for elderly relatives, and problems with public transport.
“What the Government is proposing is punishing those people to force them to take on more hours without actually dealing with the underlying causes,” Dr Stephenson said.
For the first time in decades this year, the number of women aged 25 to 34 leaving the workforce to care for children is going up, and four in 10 mothers have considered giving up work or cutting their hours because of the cost of childcare.
Following the unveiling of the mini-budget, Shadow Minister for Children and Early Years Helen Hayes asked: “Why does the Chancellor think that bearing down with punitive sanctions on the lowest-paid working parents who work part-time will help them increase their hours when what they really need is an accessible affordable childcare system fit for the 21st Century?”
Far from “making work pay” – as the Chancellor promised – the WBG is also concerned that the new rules will actually make it harder for people to work.
“If you’ve got, for example, a disabled child, which means that you can’t work longer hours, but the job centre coach thinks that you can and decides to sanction you, and you’re then worried about how you’re going to feed that child or pay rent, the chances of you being able to increase your hours is really minimal,” Dr Stephenson told Byline Times.
“We know that benefit sanctions don’t work” she said, pointing to the Department for Work and Pensions’ refusal to publish its own 2019 evaluation on the effectiveness of benefit sanctions, despite explicitly promising to make the findings public.
It is not just the tightening of benefit rules for part-time workers that will widen gender inequalities. Analysis by the WBG shows that men are more likely to benefit from Kwarteng’s new package of £45 billion in tax cuts.
Around 80% of those who benefit from scrapping the top rate of income tax will be men, while women are more likely to miss out on the 1p cut in the basic rate of income tax as 77% of workers who earn too little to pay any income tax are women.
The mini-budget is yet another worrying sign that the new Government is downgrading the importance of women’s rights. Liz Truss – who previously described herself as a “Destiny’s Child feminist” – chose not to appoint a Minister for Women and Equalities and instead handed A broader equalities portfolio to Nadhim Zahawi.
Although Kwarteng heralded his new mini-budget as “the beginning of a new era”, there are concerns that the package of tax cuts – the biggest of generations – will result in a renewed era of austerity. Reacting to Kwarteng’s fiscal package, former Shadow Chancellor, Labour’s John McDonnell, predicted a “period of economic instability, recession, austerity”.
And, as the decade of Conservative welfare cuts has shown, austerity – much like the new benefit sanctions for part-time workers – will hit women hardest.