Here are four trade union responses to the emergency budget.
FBU REACTION TO BUDGET
Commenting after today’s budget address by the chancellor of the exchequer, George Osborne, the Fire Brigades Union’s general secretary, Matt Wrack said:
“A two-year pay freeze for public sector workers, a massive VAT rise and a three-year freeze in child benefits, accompanied by cuts in corporation tax, leave little doubt who is to pay for the crisis under Mr Osborne. It is modestly-paid public sector workers like firefighters who are being made to pay for the failures of the banking system.
We have yet to see how 25% cuts in departmental budgets will be distributed, but the fire and rescue service is likely to be severely hit. There has been no golden age of huge investment in our service. We have fewer firefighters than we did ten years ago. The cuts we have already seen have been targeted precisely at the ‘front line’. More cuts will mean even fewer firefighters. The brutal truth is that such cuts increase the risk to the public and to firefighters.
We have huge concerns that [John] Huttons review of public sector pensions will pave the way for further attacks. Firefighters already pay 11% of their salary in pension contributions and have already seen a series of adverse changes to their scheme. Their pension scheme was designed to take account of the special type of work they do and the risks they face.”
Unite emergency budget reaction
Hurting the needy and vulnerable is vintage Thatcher
Commenting on the Con-Dem coalition’s emergency budget, announced today (Tuesday), Unite joint general secretary, Derek Simpson said: “Osborne and Cameron’s talk of financial Armageddon is not because they have the solution to the deficit but to scare the British people into accepting the biggest attack on essential services for a generation. Today the mask slipped to reveal this government for what it is – Tory slashers of services and friends of the rich and powerful.
“Where is the promised fairness in cutting the wages of needy households yet fighting shy of closing the tax loopholes which allow the wealthy to dodge their duty to this country? And increasing VAT is reckless – it will stop people spending, harm UK business and choke off the recovery.
“This budget is vintage Thatcher. The Lib Dems have been conned into hammering the poor, choking off investment and cuts that risk plunging this country into a longer and deeper recession. If they do not disassociate themselves from this, then the Lib Dems will have to bear the responsibility.”
Unite warned that the following measures will hit working people and impede economic recovery:
- Freezing child benefit for three years, hitting low waged households hardest
- Freezing public sector pay, hitting some of the lowest paid in the land, for two years
- Reducing investment grants for the struggling manufacturing sector to £25,000 and below
- Increasing VAT from 17.5 per cent to 20 per cent, which will endanger the fragile consumer recovery
- The 25 per cent cut in public spending in next four years
- £11 billion welfare benefit cuts over next four years.
GMB On Lib-Tory Budget
IT HAS TAKEN THE TORIES A MERE SIX WEEKS SINCE TAKING OFFICE TO BEGIN THE DEMOLITION JOB ON PUBLIC SERVICES AGAIN SAYS GMB
The Tory claim that there is an economic necessity to make these savage cuts is to turn the truth on its head as the fragile recovery underway places a duty on Government to sustain demand to ensure growth says union
GMB commented on the emergency budget put forward today by the Liberal/ Tory Coalition Government.
Paul Kenny GMB General Secretary said:
“This budget is an almighty gamble. It’s the same old Tories squeezing the least well off households till the pips squeak because they have not changed from when they said “if it’s not hurting it’s not working”.
It took the outgoing Labour Government over 10 years to repair and build up our public services after the years of neglect from the last time the Tories were in office. It has taken the Tories a mere six weeks since taking office to begin the demolition job on public services again.
The Tory claim that there is an economic necessity to make these savage cuts is to turn the truth on its head. The fragile recovery underway places a duty on the Government to sustain demand in the economy to ensure growth. Getting back the 6% of national output that was lost due to this bankers recession is the only sure fire way of closing the gap between Exchequer income and expenditure.
This was the Liberal Democrat policy too less than seven weeks ago. The lure of office has led to a Lib Dem change of policy to support this gamble which will result in hundreds of thousands of workers in both private and public sectors loosing their jobs and maybe give rise to a double dip recession. What a betrayal of the millions who voted for the Lib Dems.
There will be a reaction to these savage cuts. GMB will join with all those in the community and in other organisations to defend our public services and to demand an economic policy that promotes growth.”
Budget: Government declares war on public services
UNISON General Secretary, Dave Prentis, today accused the Government of declaring war on public services and public service workers with the most draconian budget in decades.
“This budget signals that the battle for Britain’s public services has begun with the Government declaring war. Public sector workers will be shocked and angry that they are the innocent victims of job cuts and pay freezes.
Freezing public sector pay when inflation is running at 5.1% and VAT is going up, will mean a real cut in living standards for millions of ordinary workers and their families – already struggling to pay rising bills.
Nurses, social workers, midwives, paramedics, police community support officers, housing and environmental officers who provide vital public services, are amongst those who will be hit hardest by the two year pay freeze. And for local government workers this comes on top of this year’s freeze.
A 25% cut in departmental public spending will decimate our public services. The budget will do nothing to restore confidence or kick-start the recovery, but will push local economies into the ground, raising the spectre of breadline Britain.
They haven’t even bothered to consider any other option but slash and burn. What of the bankers who caused the recession and the super-rich who evade tax? They must be breathing a sigh of relief that they got away so lightly. The bank tax levy is a poor substitute for a serious ‘Robin Hood” tax on financial transactions. It is a missed opportunity to raise £30bn which would have made a significant dent in the country’s deficit.
Throwing tens of thousands of public sector workers on the dole will cost the country billions in lost tax revenue as well as piling billions onto the benefits bill.
The Chancellor dreams of a private sector recovery but how can that be on the back of brutal cuts to public services workers. Local businesses, shops, hairdressers, restaurants will go to the wall as spending dries up. No amount of fiscal stimulus will do any good if they have no customers
Vital services that the poor, the sick and the vulnerable rely on, are in the firing line. There is no compassion in this coalition.
Freezing council tax is a useless gesture saving people pennies but cutting tens of millions from council budgets, trhreatening jobs, losing services and undermining the local economy.
Raising VAT affects the poor the most as they spend a higher proportion of their meagre incomes on goods and services.
Meanwhile major utility companies spend money sponsoring sporting events whilst attacking pay and conditions – that cannot be fair.”
Adding 500,000 public service workers to the dole between now and 2015 – which the CIPD says would be the likely effect of Osborne’s spending plans – will cost around £10 billion in lost tax and increased benefit payments. This would almost entirely cancel out the reduction in the pay bill, as well as dealing a massive blow to local economies and communities.
UNISON’s Save Our Services alternative budget:
£4.7bn could be raised every year by introducing a 50% tax rate on incomes over £100,000
£10bn could be raised every year by reforming tax havens and residence rules to reduce tax avoidance by corporations and ‘non-domiciled’ residents
£14.9bn could be raised every year by using minimum tax rates to stop reliefs being used disproportionately subsidise incomes over £100,000
£30bn could be raised every year by introducing a Major Financial Transactions Tax on UK financial institutions – the Robin Hood Tax
At least £1.5bn could be raised this year by bringing back the windfall tax on bankers’ bonuses.
£4bn could be saved this year by cancelling Trident, the project could cost as much as £100bn.
£500m could be saved every year by eradicating healthcare acquired infections from the NHS – the extra cleaners would cost half this.
£495m could be saved every year by adopting measures to improve the health and well-being of NHS staff, thereby reducing sickness absence
£1bn could be saved every year by halving the local government agency bill, as has been achieved by high performing councils
£5bn could be raised every year with an Empty Property Tax on vacant dwellings. This only exaggerates housing shortages and harms neighbourhoods.
£2.8bn could be saved every year by ending the central government use of private consultants who bring little discernable benefit
£3bn could be saved in user fees and interest charges every year if PFI schemes were replaced with conventional public procurement
Total – £77.895bn.