Published: 28 Nov 2018
Female lone parents, Black families, severely disabled people and families with more than three children are the biggest losers in terms of household income as a result of combined tax, spending and local services cuts between 2010 and 2022, new research from the Equality and Human Rights Commission reveals today.
Taking account of changes to taxation, social security and local authority services the research estimates that household income in Scotland has dropped for:
- female lone parent households by 7.8%
- Black households by 6.5%
- larger families by 8%
- severely disabled people by 5%
- younger people by 4%
The research also shows that whilst household income for the poorest in Scotland has dropped by 5% it has risen for the more affluent by up to 1%.
John Wilkes, Director of the Commission in Scotland, said:
'The findings show just how stark and how unequal the combined impact of the recession, austerity and public spending cuts have been. Using this new approach to assessing the combined impact of tax and spend policy reveals that it is the most marginalised who have suffered the most.'
The report shows that impacts fall unevenly across our communities. While white households lost on average £200 as a result of spending changes between 2012 to 2022, Asian households lose up to £800, and Black African and Caribbean households £1,050.
The most severely disabled households in England are projected to lose over £2,900 compared to a gain in Scotland over the same period of around £100, attributed to increased spending on health, social care and housing.
Mr Wilkes continued:
'We already know that ethnic minorities, disabled people, and lone parents are much more likely to live in poverty than other Scots, and face far higher than average unemployment.
'What is unique about this work is that it shows that we can and must consider the different impacts on different groups before we make major policy changes. Otherwise we risk increasing the inequalities in our society. Positive policies however such as mitigating effects of some social security changes has saved many from even greater income losses.'
The report compares the impact across Scotland, England and Wales. Scotland is judged to have adopted more “pro poor” policies and as a result the household income reductions are smaller than elsewhere.
Total household income in England is projected to fall by £1,450 between 2011 and 2022, compared to £200 in Scotland and £470 in Wales. Higher and further education sustain the highest cuts across Great Britain but in Scotland spending on both early years and housing has increased substantially, while falling elsewhere (by 50% and 30% respectively).
Speaking about the report today its author Howard Reed said:
'This research shows that the combined impact of tax and social security reforms since 2010 has hit the poorest households in Scotland hardest and has also had detrimental effects for particular kinds of families, especially lone parents and households with three or more children, black households, and households with severely disabled people.
'The Scottish Government’s own spending choices have mitigated some – but not all – of the adverse consequences of the tax and social security decisions made by the UK Government in Westminster.'
The report makes a number of recommendations:
- that the UK Government should consider mitigating the large negative changes to reduce disproportionate impacts on some groups
- that the Scottish and Welsh Governments review spending on HE and FE where the greatest cuts have taken place
- that all governments conduct equality analysis of spending plans specifically to identify areas of disproportionate impact on women, ethnic minorities and disabled people
- that all governments commit to core minimum protections to safeguard people’s rights
Notes to editors
The Equality and Human Rights Commission is the National Equality Body (NEB) for Scotland, England and Wales. We work to eliminate discrimination and promote equality across the nine protected characteristics set out in the Equality Act 2010. We are an “A Status” National Human Rights Institution (NHRI) and share our mandate to promote and protect human rights in Scotland with the Scottish Human Rights Commission (SHRC).
Today’s report, the cumulative impact on living standards of public spending changes, was written by Howard Reed and Johnathan Portes of Landman Economics. The analytical model combines data on trends in aggregate public spending (broken down into different spending categories) with survey micro-data on the usage of public services by households. The public spending analysis focuses on those areas most likely to impact of households for example spending on education, health, housing, and social services and policing but excludes areas like health research, defence, and fire rescue.
The report notes that projected population growth in England (8%) is higher than in both Scotland (4.5%) and Wales (4%) and that may account for some of the deficits found in English spending plans as faster population growth in England means that spending is being stretched increasingly thinly.