Why progressive women should care about spending cuts

This week is TUC week. Nicola Smith, Senior Policy Officer at the TUC writes this week’s guest blog.

It’s easy to talk about cuts in the abstract – and to presume that there are large-scale painless efficiencies across the public sector that will allow us to reduce our deficit with ease. But the reality is that cuts of the scale that the Government are proposing cannot be made without significantly increasing inequality and taking substantial economic risks.

Women will feel the impact of these cuts. Earlier this year TUC research showed that women’s jobs were on the line in the public sector. Our analysis suggests that around 40 per cent of women in work in the UK are employed in public sector jobs – and that areas where there are particularly high levels of female public sector employment are also those where male unemployment rates rose the most during the recession. With the Office for Budget Responsibility forecasting that over 600,000 public sector jobs will be lost by 2015, it is clear that working women will feel the impact. And with 38p of every pound of state expenditure going directly to the private sector, it won’t only be state employees who feel the jobs impacts of the cuts.

But job cuts are only part of the story – when posts are lost across the public sector, so are services. Already, before the Spending Review has even reported, around £13 billion of cuts have been announced that directly cut services from children and families. These include cuts in free school meals, in Tax Credit payments for families with new babies, in careers services for young people who are not in education or employment and in the Future Jobs Fund for those facing the prospect of long-term worklessness.

As new TUC research shows, public spending is a driver of redistribution. Households in the poorest decile, whose average annual income is £6,500, receive transfers and services from the state equivalent to 328% of their original household income. In contrast, households in the richest decile, whose average annual income is £76,200, receive transfers and services equivalent to 19% of their original incomes. Spending on public services and social security makes a substantial contribution to the reduction of inequality in society. As services are cut it is the poorest, who are more likely to be women (and specifically women with children), who will feel the inevitable impacts.

The TUC believe that there is an alternative, based on reducing the deficit over a more sensible time scale, with much more flexibility and a far greater emphasis on closing the fiscal gap with fairer taxes and the proceeds of growth. We also believe that this change of tack is an economic as well as a social imperative. Taking large amounts of money out of the economy when the recovery remains extremely vulnerable risks increased unemployment (and consequently social security payments), slower growth, reduced tax revenues and may ultimately cause further damage to the public finances. In Ireland, which embarked on deep austerity measures a year and a half ago, public services have been slashed but the economy remains sluggish and the country’s credit rating has been downgraded.

Spending cuts are not painless and we urge the Government to recognise the economic and social consequences that steep cuts now will have. Until they do, we will actively campaign against the cuts –all progressive women should do the same.

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