Published on May 7th, 2013 |
by Sophie Goss
Image © CHINA. Beijing. George Osborne, Britain's Chancellor of the Exchequer with British business delegation. 2010
Are the welfare cuts justified?
In light of George Osborne’s welfare reforms many are affected across the country. According to a
study conducted by The Guardian the cuts will place 200,000 children into poverty as the poorest
of families will lose 38% of household income. The reforms started on April 1st this year (2013)
spurring outrage amongst the British public, thousands have taken to the streets to protest these cuts.
George Osborne has been quoted as saying “the Government is here to help families who go out to
work”. Numerous others will beg to differ, the reform will hit low-income families a lot more than
has been led to believe. Council tax being shifted to local councils will cause a reduction of 10%
in council tax benefit which is claimed by an estimated 5.9 million low-income families. Of course
the recent introduction of the bedroom tax will pose as a threat to those on social housing benefits,
working age benefits and unemployed claimants. Facing a 14% cut for 1 spare bedroom or 25% for
2 or more.
Along side the mentioned cuts many other areas have been considered and changed, for example
the chance of legal aid provided has been scrapped. The NHS commissioning has changed and
Disability living allowance scrapped.
It is no secret that the British economy is at a low, Unemployment is at 7.7%, Inflation at 2.7%
and there has been a decline in the average earning growth of 1.4%. Britain has already begun its
austerity measures. The welfare reform was put in place to aid the economy. Osborne has stated
that “the benefit system is broken; it penalises those who try to do the right thing; and the British
people badly want it fixed”.
With the reform well in place, are the right areas being affected? Of course measures are needed to
be put in place to secure its future stability. Having said this, has the reform placed its measures in
the right places? Many areas have been ignored and untouched. One of the biggest untouched areas
being the tax gap. The Tax Justice Network state that the gap between tax owed and the tax paid
is at 120bn even though the Revenue & Customs department say the gap is more like 40bn being
avoided and 28bn being owed.
With 120bn in unpaid taxes unaccounted for in Osborne’s reform, the economy continues to
decline. With the recent discovery of tax avoiding companies such as Vodafone, Topshop and
Starbucks leading to public outrage and protest. Vital area’s of the British economy are being cut,
leading to the question “are the right area’s being targeted for the country’s best interests?”