Women’s Budget Group analysis of the 2012 budget

The Women’s Budget Group has released its analysis of the 2012 budget which it argues  further undermines gender equality in the UK. According to the WBG:

‘The 2012 Budget grabbed headlines for its tax measures – tax reductions for some, and increases for others. However, these measures should not be seen in isolation. Instead they must be situated in the context of an increasing squeeze on public spending, cuts in public sector services; loss of public sector jobs; and the public sector pay freeze and now the prospect of further falls in public sector pay in the poorest regions. These factors will disproportionately impact women and make it harder for them to contribute to the wellbeing of their families and communities.

The UK WBG is particularly concerned that:

The above inflation increase in the personal allowance for those under 65 from £8,105 (2012/13) to £9,205 (2013/14) will increase gender inequality. The policy does not help the 59% with no earnings, or the 67% of those with earnings below the current personal allowance who are women.

The majority (55%) of the people gaining from this measure will be men.

Changes to the Higher Personal Allowances for People Aged 65 to 74 and Aged 75 and Over: a ‘Granddad’ not a ‘Granny’ tax. The majority of people losing from this measure will be men, but that is because they have higher pensions than women. That so few losers are women demonstrates the shockingly low level of most women’s pensions. The Chancellor should use the revenue gained by this measure for an above inflation increase in the basic state pension which would bring most benefit to the poorest pensioners, mainly lone women.

No Treasury gender impact assessment of the cumulative implications of the Budget for social security, employment, for earnings, and for availability of public services. It appears that the Treasury continues to believe that gender impact assessments are not its responsibility, and need only be undertaken by other government bodies, such as HM Revenue and Customs, and Department of Work and Pensions.

The government’s economic policies will further undermine gender equality in the UK

•         Cutting a further £10bn from ‘welfare’ spending by 2016/17

would be devastating for women, as benefits make up, on average, one-fifth of women’s income, compared with only a tenth for men .

•        The Office for Budget Responsibility has increased its

estimate of how many jobs will be lost in the public sector between the beginning of 2011 and the start of 2017 to 730,000 . Women account for two thirds of employment in the public sector, and therefore will face the brunt of these losses. Women’s unemployment is at the highest level in 25 years; and women account for two thirds of the latest monthly increase in unemployment  .

•        Many women who do have a job face the prospect of further

reductions in their real earnings. Just before the Budget, the government announced that the minimum wage for young people will be frozen for 2012/13. Even the for older workers the 11p rise is a cut in real terms. Women make up the majority of those on the minimum wage.

•        The Chancellor wants to introduce ‘regional pay’ in the

public sector, to reduce the gap between earnings in the public sector and the private sector. Lower income women – home helps and dinner ladies, for instance, will be disproportionately affected by this.

Professor Diane Elson, Chair of the UK Women’s Budget Group, said:

“The Chancellor has missed a major opportunity to put forward an economic recovery strategy with gender equality at its heart. The government’s belief that tax cuts for businesses and high income individuals, relaxing regulations that protect worker’s rights and the environment, reducing real pay, and cutting public sector employment will stimulate growth is flawed. It does nothing to address the main thing holding back private investment: a lack of demand. Putting more money in the hands of low income women, through improvements in benefits, tax credits, pensions, and public sector employment opportunities would do more to stimulate demand and promote economic recovery than tax cuts for rich men and the corporations that they control.”’


About coventrywomensvoices

Coventry Womens Voices is an independent group of women’s organisations, organisations working with women and individuals that have come together to ensure women’s voices are heard when policy is made in Coventry. Our mission is to “Make Women’s Voices Heard in Coventry”.
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