BRITISH PRIME minister David Cameron and his deputy, Nick Clegg, yesterday insisted that the spending cuts to come would be fair, following a warning from a respected economic think tank that poor families with children would be among the biggest losers.
The two men faced sharp criticisms from students and others during a meeting with voters in Nottingham. They repeatedly emphasised that they had not come into politics to make cuts, but that they had done what was necessary to restore stability to the UK’s finances by 2015.
Under the Comprehensive Spending Review’s cutbacks, the richest two per cent of the population will face the sharpest falls in income but this is because of tax changes made by Labour’s Alistair Darling before he stood down as chancellor of the exchequer in May.
“The tax and benefit changes are regressive rather than progressive across most of the income distribution. And when we add in the new measures announced yesterday this finding is, unsurprisingly, reinforced,” said the acting director of the Institute of Fiscal Studies, Carl Emmerson, while analyst James Browne added: “Overall, families with children seem to be the biggest losers.”
Local authorities, some of whom began to lay off staff yesterday, warned they could lose 100,000 jobs and that there would be a loss of a wide range of public services, including cuts to child protection services in the coming years because of the decision to cut almost a third of their funding.
The IFS, meanwhile, warned that the decision to give local councils the authority to pay out housing grants would give them an incentive to pay the grants in a way that would encourage poor people to leave the area.
On the IFS’s verdict, Mr Clegg urged people to have “a sense of perspective” about the impact of the review. “I would not have advocated this if I didn’t feel we had tried to do this as fairly as possible. I would ask people to have a little bit of perspective; the picture’s a little bit more balanced than people are saying.”
Both Mr Cameron and Mr Clegg ate humble pie before the audience. Mr Cameron acknowledged that he had gone back on an election pledge not to cut child benefit. “I had to eat those words. But is it right to go on asking people on £15,000, £20,000 or £25,000 a year to keep paying so that Nick and me and [Labour leader] Ed Miliband can go on getting child benefit?”
On the decision to sharply increase tuition fees for university students from 2012, when they will double in most cases and, perhaps, more than double, Mr Clegg, whose party has longed wanted their abolition, said: “It’s one of the most difficult things I’ve ever had to do – to own up to pledging things I now feel I cannot deliver.”
In a bid to shore up support among Liberal Democrat MPs and supporters, Danny Alexander, the party’s chief secretary to the treasury, wrote to party members, saying: “We have made the tougher choice, no doubt, but we should be proud of the way we have taken responsibility and we have done the right thing.”