The chancellor could not be more wrong when he used his budget to talk about the “strong” foundations of our economy. The reality is that the coronavirus pandemic has exposed deep structural flaws.
The virus has thrown into sharp relief what is really happening in our labour market, where work has become ever more insecure. Workers have had their protections and rights eroded and suffer from a culture that expects constant availability and gives no leeway for workers with additional burdens or responsibilities.
In what is for many a precarious work environment, 4.7 million people are self-employed. Many choose to be; others have no choice. There are a million people on zero-hours contracts. Many of them have no recourse to statutory sick pay.
This makes Rishi Sunak’s failure to support them in the face of the coronavirus outbreak all the more concerning. At prime minister’s questions, Boris Johnson said that no one would be penalised for doing the right thing when it comes to combating the impact of the virus. However, the chancellor’s announcements around sick pay and access to benefits for people who have to self-isolate tell a very different story. At just £94.25 a week, statutory sick pay is around 40 per cent of what you would take home if you were earning the minimum wage.
Punishing people financially for self-isolating will worsen the impact of the outbreak. We should be very worried about the choices people will make if they’re put in the impossible position of deciding between protecting themselves and putting food on the table or paying rent and mortgages.
We know that 16 million people in this country have savings of less than £100 and that 60 per cent of people on low and middle incomes have no savings whatsoever. The welfare system needs to support people when they need it.
But it is not just on sick pay where the chancellor missed an opportunity to ensure we are best placed to mitigate the impact of coronavirus. All those who work in our social care sector are in the front line in this battle.
Already, one in seven adults has unmet care needs. And now a sector that is hugely reliant upon precarious labour is going to bear much of the brunt over the coming weeks and months. Yet the chancellor was silent on the question of social care. There was nothing in the budget about support for local councils and their role in supporting social care and public health. In the coming weeks, the chancellor must think hard about what help he can give them to boost social care at this critical time.
There were, however, elements of the budget which I do welcome, such as the extra funds for the NHS and the long-awaited investment in flood defences. I hope this will include the £23 million still needed to properly protect Leeds from a repeat of the devastating floods we endured in 2015.
We have had to wait a long time for this budget – and it should have spoken to our future ambitions too. Ahead of the COP26 conference later this year, the chancellor should have seized the chance for Britain to take a leading global role in fighting the climate emergency.
Instead, he showed this is still a greenwash government when it comes to the environment as he unveiled plans to spend £27 billion on building 4,000 miles of roads and £2.7 billion on another fuel duty freeze.
The fact that there was just £6 billion for local transport and £140 million for a one-year extension of the electric vehicle grant shows the government has failed to recognise the scale of the challenge we face.
Even before the impact of coronavirus is included, growth of 1.1 per cent is predicted for this year. By the end of this parliament national debt is forecast to reach £2 trillion — double what the Conservatives inherited from Labour in 2010.
If you stunt growth by failing to invest, by discouraging businesses from investing and by allowing productivity to stagnate, you choke off the growth we desperately need to raise living standards, reduce the budget deficit and pay back the national debt.
He may have been in post for barely a month, but this chancellor’s first budget only served to confirm that austerity was a failed experiment that came at cost we will all bear for years to come.