Disabled hit hardest by spending cuts, says equality watchdog

30 Jul 14

Families with disabled people have been most affected by government’s spending cuts and tax and benefits changes since 2010, an analysis carried out for the Equality and Human Rights Commission has found.


According to the analysis undertaken by National Institute of Economic and Social Research and Landman Economics, low-income families also felt the impact of the government’s deficit reduction strategy.

Today’s Cumulative Impact Assessment report said this was not surprising as there had been significant reductions to working-age welfare, including the introduction of a £26,000 annual cap and the so-called bedroom tax.

The analysis, which forms part of the EHRC's attempt to improve the evaluation of government spending decisions, also found women lost more from the government’s direct tax and welfare changes in 2010-15 Spending Review period than men. This was due to women receiving a larger proportion of benefits and tax credits related to children.

The report concluded that, although government cuts have been criticised for affecting young people disproportionately, households containing younger adults actually did better than other households when the cumulative impact was calculated. This was because the impact of benefit changes were relatively uniform across all age groups, but younger people benefited most from increases in the personal allowance to £10,500.

Looking only at the consequences of reductions in public service spending since 2010, the examination concluded black and Asian households lost out more than other groups. This was a result of greater use of further and higher education, and – for black households – social housing.

However, the commission stated the modeling for these spending changes was less developed than for tax and benefit changes, meaning this represented only a preliminary assessment.

It recommended that the Treasury could help improve this by reviewing its approach to equality impact assessments ahead of Spending Review expected after next May’s general election. In particular, the department should identify where quantitative analysis of spending decisions on public services, such as health and education, was feasible, and issue guidance on data collection.

Commission chief executive Mark Hammond said the report showed it was possible to measure the cumulative impact of fiscal decisions, but acknowledged further work is required to improve it.

‘Fairness is a value we all share, particularly when it comes to how the government spends our money,’ he said.

‘The best way to develop efficient and fair policy is to look at different options, and model their impact alongside other policy decisions being made at the same time.

‘In the context of the complex task of co-ordinating analysis and decision making across government during a spending review, this is difficult territory. But the research published by NIESR and Landman takes us closer to seeing that a model can be developed that will make this task possible.

‘We will now be working with the Treasury and other departments to develop this work and considering how it could be incorporated into the 2015 Spending Review.’

Responding to the report, a Treasury spokeswoman said: 'As part of the government’s long term plan, we are committed to tackling inequality and supporting hardworking people, which is why we are raising the personal tax free allowance – lifting 3.2 million low income individuals out of income tax – and introducing new support for childcare costs for working families, who will benefit by up to £2,000 a year per child.

 'We have a regular and ongoing dialogue with the Equalities and Human Rights Commission about improved arrangements for assessing equalities impacts, to which today’s report is a useful contribution.'

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