Lots of speculation has surrounded the Summer Budget, and now the veil is lifted. Doubtless we’ll hear a lot more debate over the coming days, weeks, months and years as to what the impact of this will be. Clinks members will likely be focussing their attention on people from our poorest communities, and the impact of changes to the benefits system. We know that people suffer multiple disadvantage as a result of poverty, and we know that multiple and complex needs present most frequently in impoverished communities; often leading to contact with the Criminal Justice System.
In our ‘Who Cares?’ report, where we looked into to the experience of women specific services, as well as our most recent State of the Sector report, our members highlighted the increasingly complex needs of service users, as well reporting that service users were struggling to cope financially. With that in mind, what should we be looking out for in the budget?
The £12 billion benefits cut
The Conservative manifesto made clear that they would attempt to make cuts of £12 billion to the working-age benefits budget by 2020. This budget sets out the measures they’re taking to realise this, which includes:
- freezing most working age benefits from April 2016 for four years, including tax credits and Local Housing Allowance (not including maternity or sick pay).
- a cap on benefits for out of work families, reduced from £26,000 to £20,000 per annum, except in London where it will be capped at £23,000.
- The child element of universal credit and tax credits will no longer be awarded for the third and subsequent children after April 2017.
- From April 2017 the “Youth Obligation” will see the Government scrap automatic entitlement to housing benefits for 18-21 year olds on Universal Credit, and require them to apply for an apprenticeship, traineeship, or mandatory work placement. Homeless Link raised concerns that housing benefit cuts could leave young people with nowhere to turn.
- From April 2017, anyone making a claim for the disability benefit Employment and Support Allowance (ESA) and placed in the Work Related Activity Group (WRAG) will receive a reduced level of benefit, equal to that of those claiming Jobseeker's Allowance (JSA). Mind called the benefit cuts “insulting and misguided” for people with mental health problems, and they have published a blog on the issue.
The devolution agenda
The theme of devolution continues and the ‘Northern Powerhouse’ got a lot of mention, including the expansion of city deals outside of Greater Manchester to Liverpool, Sheffield, Leeds and West Yorkshire were mentioned, alongside negotiations with West and East Midlands as well as areas of the South West. As budget responsibilities around areas such as health and social care, employment, and transport are devolved over this Parliament we will need to be vigilant in assessing the impact on local services.
The budget announced it will fully fund the NHS plan which called for £8 billion more by 2020-21 (plus £2 billion announced in the 2014 autumn statement). On the other hand the ‘Five Year Forward View’ sets out how the NHS will deliver £22 billion in efficiency savings by 2020-21.
A new national living wage
Will be introduced from April 2016 for those aged 25 and above, which will start at £7.20 and rise to £9 by 2020. The Living Wage Foundation responded to the announcement of a National Living Wage
Support for victims of domestic abuse
A £3 million fund to encourage innovative approaches to people suffering domestic abuse was announced. Consultation will be held on this before the Autumn spending review; looking at both how services are funded and how they are delivered. This will refresh the violence against women & girls strategy in the autumn.
NCVO also summarised the benefits cuts and living wage proposals, alongside the implications of the budget on the wider voluntary sector, and have since then posted up a fuller blog analysing the budget annoucement.