Poorest and most vulnerable hardest hit by Tory reforms, study shows

The poorest and most vulnerable in society will be hardest hit by Government changes to tax, social security and public spending reforms, a major report has revealed.

Disabled people, the elderly and lone parents will suffer financial losses far greater than the general population under reforms introduced in recent years. Women will also suffer an annual loss more than double that of men, and black households will face a loss of income more than double that of white families, the research shows.

The Equality and Human Rights Commission (EHRC), which published the report, warned of a “bleak future” for those most in need, and has urged the Government to “come clean” and provide a full and cumulative impact analysis of all current and future tax and social security policies.

Released ahead of next week’s Budget, the report carried out a “cumulative impact assessment” of the impact that changes to all tax, social security and public spending reforms from 2010 to 2017 will have on people by 2022.

It shows that families with a disabled adult will see a £2,500 reduction of income per year, compared with £1,000 for non-disabled households. Those with both a disabled adult and a disabled child will face a £5,500 reduction of income per year — five times that of non-disabled families.

Black households will face a 5 per cent loss of income, more than double the loss for white households, while women will suffer a £940 annual loss — a figure more than two times higher than the losses for men.

The biggest average losses by age group, across men and women, are experienced by the 65-74 age group, with average losses of around £1,450 per year, and the 35-44 age group, with average losses of around £1,250 per year.

Lone parents will also struggle with a 15 per cent loss of income, compared with losses for all other family groups which stand at between 0 and 8 per cent.

In light of the findings, David Isaac, chair of the commission, said: “The Government can’t claim to be working for everyone if its policies actually make the most disadvantaged people in society financially worse off

“We have encouraged the Government to carry out this work for some time, but sadly they have refused. We have shown that it is possible to carry out cumulative impact assessments and we call on them to do this ahead of the 2018 budget.

“If we want a prosperous and, in line with the Prime Minister’s vision, a fair Britain that works for everyone, the Government must come clean and provide a full and cumulative impact analysis of all current and future tax and social security policies.

“It is not enough to look at the impact of individual policy changes. If this doesn’t happen those most in need will face an extremely bleak future.”

Disability charities said the report offers “concrete evidence” that disabled people are the “biggest losers” from reforms by the Government in recent years.

Beatrice Barleon, policy manager for learning disability charity Mencap, said: “The EHRCs report offers concrete evidence supporting the warnings already raised by the disability sector; that due to a succession of cuts and reforms to disability benefits and changes to tax credits, disabled people and their families are the biggest losers from the austerity agenda.

“The Government has repeatedly argued that they want to protect the most vulnerable in society, yet this report shows the opposite is in action. With some families with disabled members losing up to £5,500; disabled households are getting pushed into poverty at the same time as available social care support has been slashed year on year.”

Kamran Mallick, chief executive of Disability Rights UK, said: “This report makes for grim but unsurprising reading – disabled people have been saying for many years that they are increasingly struggling to get by.

“The report is clear evidence that the government’s reforms have been having a massive negative effect, driving disabled people deeper into poverty when they already don’t have enough money to live on. We’re acutely struck by the report’s conclusion that the reforms will continue to cause ‘particularly adverse impacts on disabled families’.

“This can’t go on. The Government should use next week’s Budget to call a halt to its reforms and review the cumulative impact of tax and benefit changes since 2010. We have to come up with a system which doesn’t penalise people for being disabled.”

With regards to the fact that lone parents will be disproportionately affected, Young Women's Trust chief executive Dr Carole Easton OBE said: “Young women are having the rug pulled from under them as incomes fall and prices rise.

"They are working hard to be financially independent but for too many the reality is insecure work, low pay and debt. Today's report shows that this is only set to get worse without action.

“Much more needs to be done to improve young women’s prospects. This means giving them the right skills and support to find jobs, ensuring decent and flexible jobs are available for those who need to balance work with care, and extending the National Living Wage to under-25s, so they are paid the same amount for the same work."

In light of the findings that the elderly population will be worst hit, Caroline Abrahams, director at Age UK, said the charity was "dismayed" that the study suggests people in the 65-74 age group will lose an average of £1,450 a year by 2022 as a result of recent policy changes.

“If this happens it would have a serious adverse impact on the living standards of older people on low and modest incomes – and with 1.9 million of them still living in poverty they are far more numerous than is often assumed,” she said.

A Government spokesperson said: “This analysis fails to take into account our successful jobs market or the steps we are taking to help people of all backgrounds get on in life, including expanding tax-free childcare, boosting apprenticeships and introducing the National Living Wage.

“Inequality is at a 30-year low and there are 1.4 million more women in work since 2010. We inherited the highest deficit since the Second World War and have reduced our borrowing ever since, while protecting our public services, cutting income tax for 30 million people and ensuring those with the broadest shoulders contribute the most.”