The real implications of the Tory plan to cut tax credits for low paid workers are starting to hit home. Even some Tory MPs are starting to worry about the impact these cuts will have, likening them to Thatcher’s Poll Tax in terms of public opposition.
The real implications of the Tory plan to cut tax credits for low paid workers are starting to hit home. Even some Tory MPs are starting to worry about the impact these cuts will have, likening them to Thatcher’s Poll Tax in terms of public opposition. The impassioned appeal of a young woman on BBC Question Time over the way the cuts will leave her with nothing, must have made Tories even more nervous.
Interestingly, this woman said she had voted Tory but now leaned towards support for Jeremy Corbyn. Her words exposed the realities of life in Tory Britain today:
“I voted Conservatives originally because I thought you were going to be the better chance for me and my children. You’re about to cut tax credits after promising you wouldn’t. I work bloody hard for my money to provide for my children, to give them everything they’ve got and you’re going to take it away from me and them. I can hardly afford the rent I’ve got to pay, I can hardly afford the bills I’ve got to do and you’re going to take more from me.”
She then looked at Amber Rudd, the Tory on the platform, and added, almost in tears by now, “Shame on you!”
Despite the strong public reaction to this outburst on live TV, the Tories were able to push through a Commons vote on the tax credit cuts on Tuesday, but not without serious opposition from within their own ranks. Tory newcomer Heidi Allen (South Cambridgeshire) spoke during the debate on a Labour motion to reverse the cuts saying that these measures sent “a message to the poorest and most vulnerable in our society that we do not care.” How true.
Tory supporters of the cuts claim that other reforms, such as raising the minimum wage (re-branded as a new ‘Living Wage’), will compensate for this. But the facts do not confirm this fantasy. The Institute of Fiscal Studies has confirmed that it would be “arithmetically impossible” for such a balancing act to happen. The IFS also note that under Osborne’s cuts, 13 million families will end up losing around £240 a year, and for three million families that figure would rise to an average of £1000.
This mood of anger, which can only grow in coming months, reflects the reality of life for the low paid in Britain. According to the latest official data from the Office of National Statistics (ONS), a quarter of all jobs outside London now pay under the Living Wage figure. For youth aged 18-24, the figure is much higher: 48% of those in London and 58% of those outside the capital. Low pay in certain industries is now rife. 76% of all cleaning jobs in London now pay below the Living Wage level. The effort of trying to survive on such low pay will only get worse once tax credits are cut. What a condemnation of the Tories and their system.
Since long before the crisis in 2008, British employers have squeezed millions in profits from the suppression of workers’ wages. As the figures above show, despite the introduction of an hourly minimum wage in 1998, business continued to underpay their workforce by employing on super-exploitative zero-hours contracts or other forms of ‘flexible working’. In order to compensate for this cheating of the working class (which also had the dangerous effect of dampening consumer demand), Gordon Brown’s Labour government threw billions of pounds of tax credits and other working benefits into the gap. The mere fact that a government should have to intervene to provide anything approaching a decent standard of living for people in work just shows how utterly parasitical the capitalist system is, especially in Britain.
Now the Tories, whilst declaring themselves the ‘workers’ party’, are bringing an end to this lifeline for so many working families. With one hand they take from the unemployed and disabled under the auspices of attacking ‘scroungers’, and with another they rob from the working poor. For whose benefit? For the same employers and financiers whose miserly exploitation and reckless speculation caused this crisis in the first place.
The truth is that it’s not simply the Tories who are taking away the hard earned money of people like the audience member on Question Time, or Kelly, whose question was posed to David Cameron by Jeremy Corbyn during Prime Minister’s Questions – it’s the bosses, who have been systematically robbing the hard earned wages of workers for decades. The Tories’ cuts only serve to remove the plaster covering this gaping wound in British society.
A new report from the New Policy Institute just confirms this picture, stating that one in five people in Britain are now below the poverty line once housing costs are taken into account. In London that figure is one in four. The Metro newspaper report (21st October) notes that those affected include “1.2 million who live in working households – a huge increase on a decade ago.” The Metro article then continues: “Rents have increased by 11 per cent across the UK over the past five years… Wages have risen by only four per cent in the same period. The number of working-age people in poverty is up 30 per cent in ten years…” All these facts just confirm what workers and youth already know from their daily lives. No wonder so many are furious about the cutting of tax credits for those on the lowest incomes. The Tories say the cuts won’t amount to much in practice. Maybe by their standards, but when you have so little, even a small cut can prove critical.
As always the rich are getting richer and the rest of us poorer. Credit Suisse have now confirmed that half the world’s wealth is in the hands of the top 1%. Likewise, the rich have done very well in austerity Britain.
The only solution to this shameful situation is a system which guarantees good work and good pay for all; a system in which the workers and not the bosses make the decisions. We must build on Jeremy Corbyn’s leadership victory with a clear commitment to socialist policies that will end this living nightmare.