26 August 2010
The Treasury has a statutory obligation to assess the impact of spending cuts on vulnerable groups, the Equality and Human Rights Commission has said.
The equality watchdog’s warning came after ministers insisted that the spending cuts announced in the June Budget were fair and ‘progressive’, despite analysis contradicting this. A report from the Institute for Fiscal Studies said the tax and benefit changes in the coalition’s emergency Budget were ‘clearly regressive’, hitting the poorest households more than the richest.
EHRC director general Neil Kinghan said: ‘Under equality legislation, the Treasury, like all public bodies, has a legal duty to pay “due regard” to equality and consider any disproportionate impact on vulnerable groups when making decisions, including decisions about the Budget.’
He added that the law was ‘not designed to prevent reductions in public spending’, but to ‘ensure fairness is at the heart of decisions’.
The Treasury must now demonstrate that it carried out an equality assessment ahead of the Budget, and that the impact of cuts on women, disabled and elderly people and those from ethnic minorities are being considered as part of the autumn Spending Review. Otherwise the government faces ‘appropriate enforcement action’ from the EHRC, such as a compliance or court order.
A Treasury spokesman said the government’s actions were in line with their legal obligations. ‘Departments consider the impact of the Budget measures on gender, race and disability as they develop and implement the policies,’ he said. But during a BBC interview yesterday, financial secretary to the Treasury Mark Hoban was unable to confirm whether the equality assessment had taken place before the June budget.
Any formal rebuke from the ECHR would be particularly embarrassing for the coalition government, which set out to make spending cuts that were ‘evidence-based, fair and transparent’.
Shadow chancellor Alistair Darling said there was ‘nothing fair or progressive’ about the coalition’s economic policy. ‘There’s nothing ‘pro-growth’ about taking a huge gamble with the recovery – with people’s jobs.... [Chancellor George Osborne] doesn’t seem to understand that in government it’s decisions, not warm words, that count.’
Unions also stepped up their criticism of government spending policy. Unison general secretary Dave Prentis said: ‘Unison has long been warning that the Tories’ plans would hit the poor hardest. Many families are already struggling to cope with the fallout from the recession, and things will only get worse.’
The women’s rights campaign group the Fawcett Society has already launched a legal challenge against the government, claiming the Treasury failed to assess whether its June Budget proposals would increase or reduce inequality between men and women.
