WBG Response to 2021 Spending Review and Autumn Budget: Papering over the cracks rather than the transformative rebuilding needed

Speaking in response to the Budget and Spending Review, WBG Director, Dr Mary-Ann Stephenson said today:

“While there has been welcome spending in some areas, the Chancellor’s speech lacked the ambition required to level-up the country and rebuild an economy that works for everyone.”

“The Budget speech devoted more time and detail to alcohol duty than to policies on care, housing, climate and violence against women, all of which are more important to women than saving a few pence on a bottle of prosecco. There was great focus on physical infrastructure and very little on the social infrastructure that we all need, like care.”

“There were some positive announcements, but in too many areas the spending announced didn’t come close to making up for the cuts of the last ten years, let alone the impact of the pandemic, particularly on women. And as the Chancellor himself admitted earlier this week, some of the promised spending was not new money, but a repeat of earlier commitments. In many areas, the spending that was announced was short term and will simply bring some services back to 2010 levels. It was an attempt to paper over the cracks that have been exposed by the pandemic and not the transformative budget needed in order to rebuild the economy.”

“Covid has shown how much we all rely on each other. And it has made clear that our economic well-being is connected too. Today was an opportunity to set a course that enables us to emerge from the pandemic stronger and more secure – and it was an opportunity the Chancellor failed to take.”

“At this Spending Review we needed to see investment in a green care-led recovery that gives people the care they need at every point of their lives, creates decent jobs and tackles climate change. And we needed real ‘levelling up’ to tackle the poverty and inequality that has been exposed and made worse by Covid. Instead, this Spending Review feels like a missed opportunity and, in fact, shows that the Government is failing to grasp the scale of the challenges facing the UK.”

On early years and childcare

“This was a hugely disappointing budget for care, and incredibly frustrating given the way we have all relied on and valued care over the last 18 months. Funding for family hubs is welcome, but the childcare sector has been starved of money for years. In 2019/20 the free hours were under-funded by £662m, the additional £170m funding doesn’t even make up for that let alone cover the increased costs of the National Living Wage.”

“Frankly, it’s worrying that the government has yet again failed to make the connection between childcare, levelling-up and economic growth. An investment in affordable childcare could have helped to bring more parents – mostly women – back into the labour market, improving their household finances, and potentially helping to ease the current labour shortage, yet childcare continues to be a fiscal blindspot for this government.”

“The £500m promised for ‘family hubs’ was a welcome recognition of the benefits of investing in the early years of a child’s life, but 75 new hubs won’t fill the void left by the closure of more than 1000 children’s centres between 2009 and 2018/19. Between 2011 and 2017, the government cut the funding of Sure Start centres by two-thirds, that’s £1.2 billion. Their pledge of £500m to support young families in the budget still represents a loss of £700 million against what they have cut.”

“High quality childcare not only benefits children, their parents and employers, but also the wider economy. This year alone more than 3000 providers have closed. The combination of lack of availability and high childcare costs can block parents’ access to Employment. More than half (52%) of mothers not in employment in England said they would prefer paid work if they could arrange the right childcare.”

“We need investment in free Universal childcare. WBG research has shown that most of the costs of investment in childcare would be recouped through job creation and savings on social security.”

On the Universal Credit taper rate

“The cut to the Universal Credit taper rate is welcome, but doesn’t make up for the overall cut in Universal Credit of £20 a week from last month. People in paid work will get to keep more of their earnings, but it still does nothing for unemployed people, and those who can’t work because they are disabled or caring who will still lose £1000 a year, despite being among the most vulnerable groups in society. A true commitment to ‘levelling-up’ would have been to keep the uplift in place.”

On pay

“The decision to increase the National Living Wage and lift the freeze on public sector pay were both very welcome. These will particularly benefit women who are two-thirds of public sector workers and more likely to be low paid.”

“The Government must ensure that the public sector receives increased funding to meet higher pay costs (including for workers contracted out on the National Living Wage). Childcare and Social care are already in crisis because of under-funding and providers face collapse unless they are properly resourced.”

“The increase to the NLW does not make up for the £20 a week cut to Universal Credit which hit 5.5 million people. There are two million workers on NLW, many of whom do not receive UC because they have a higher earning partner.  Many women on Universal Credit earn above the NLW per hour, but have low weekly earnings because they work part time around care responsibilities.”

On public transport

“On the face of it, this is a really positive announcement, but only about £1.5bn is new money, and the focus is on more capital investment with no new money for running services day to day. Women are more likely than men to rely on public transport, which is critical to tackle climate change so the additional funding is welcome.”

“Of the spending announced today £4.2bn was already announced in 2019, and funding for buses comes from £3bn promised last year. In addition, the focus was on capital investment. Cuts to bus services have been caused by revenue cuts rather than lack of capital spending, which this money won’t help with.”

“As well as investment we need to re-organise transport routes. Women’s care work means they are more likely to make multiple short journeys throughout the day. But transport routes are designed around men’s pattern of fewer but longer journeys in peak hours.  We need investment in affordable reliable transport that allows everyone to get to work, take kids to school, shop, socialise and care for friends and family.”

On climate change

“The Chancellor reaffirmed the Government’s commitment to tackling climate change, yet went on to undermine that by announcing measures to encourage more air travel and a continued freeze on fuel duty. The week before COP26, it’s disheartening to see this from the Government who should be setting an example as the host nation.”

“As well as having severe revenue and environmental costs, measures such as these primarily benefit men, who are more likely to drive longer distances than women and are more likely to fly for business travel. And it is a measure that benefits better-off households.”

On investment in education and skills

“Help for young people with skills and education is welcome, but what the Chancellor promised  doesn’t go far enough. Even before Covid many Further Education and sixth form colleges were struggling after a decade of funding cuts that had seen funding decline per learner by 7% in real terms between 2013/14 and 2018/19. A third of colleges reported a deficit in 2018/19. This spending doesn’t even take us back to the funding level of 2010, let alone help our young people get the skills they need to navigate a quickly-changing world.”

On violence against women and girls

“The Chancellor merely made a passing mention of the epidemic of violence against women and girls. More than 1 in 4 women will experience domestic abuse during their lifetimes, 20% of women and 4% of men have suffered sexual assault, including attempts, since age 16, equivalent to an estimated 3.4 million women and 631,000 men.”

“The £185million for support services for victims/survivors falls far short of the £409million that Women’s Aid estimates is needed for domestic violence and abuse alone.”

A more detailed response to the budget will be available shortly.

Further reading: for more information about many of the issues in the Budget and Spending Review see our pre budget briefings. For a comprehensive analysis of the impact of Covid-19 on women’s economic position check out the latest WBG research here.

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The Women’s Budget Group is an independent network of leading academic researchers, policy experts and campaigners. Our vision is of a caring economy that promotes equality between women and men.