Rishi Sunak’s summer statement does not help the poor

The Conservatives have long been seen as the “party that hate the poor”. Rishi Sunak’s coronavirus aid gives more credence to that perception.

I am not an expert in the history of the Conservative Party, but my theory is as follows: Margaret Thatcher was the Conservative leader that first gave rise to the idea that the Tories hate the poor — or, at least, our modern understanding of that idea. Thatcher’s “mismanagement” (to put it lightly) of the mining-reliant economy of the North led to waves of generational deprivation and poverty that last to the present day, soured further by the Conservative Party’s continued deification and worship of their most polarising Prime Minister. Admittedly, I have no definitive proof that this is why Conservatives are perceived as the “party of the rich”, but it certainly can’t help.

Another aspect that certainly can’t help their public image is the fact that — intentionally or otherwise — many of their major policies seem determined to only help those who don’t need helping. The austerity of the 2010–2017 Cameron-Osbourne years, for example, disproportionately hurt the poor while leaving the richest relatively untouched. Conservative changes to tax and welfare programs (such as the disastrous Universal Credit) seem to almost universally hit poorer Brits far harder, while recent Tory leaders have seen social mobility and fairness teams resign in protest as Conservative governments rule over the first increases in child poverty in twenty years.

Margaret Thatcher may have been behind the modern Conservative Party’s alleged rich-pandering, poor-hating image. However, given that she hasn’t been in office for almost thirty years, it’s not exactly ludicrous to allege that the continuation of such a public image stems directly from the policies of her successors. One of her successors — the incumbent Boris Johnson — is now overseeing a pandemic in which the British economy risks complete collapse. The current economic contraction is already hitting the poorest far harder than wealthy earners, which — according to UN poverty experts — is largely down to the horrific Conservative policies of past and present. Urgent support for Britain’s poorest has been needed for months, with calls for help largely going unanswered. Boris Johnson’s chancellor Rishi Sunak promised to unveil a plan in his Summer Statement to help the economy — and, specifically, help the poor. Unsurprisingly, given his party’s image, he has failed on all fronts.

Rishi Sunak, good intentions are not enough

Rishi Sunak’s coronavirus recovery plan is sensibly aimed, with focus heaped on industries that find themselves struggling through a nationwide lockdown. Hospitality and the arts (which often find themselves hand-in-hand) are largely in-person experiences that cannot be sustained under a stay-at-home order, such as the one that was in place during the early stages of Britain’s coronavirus outbreak. Travel is also another sector that has found itself in dire straits. None of these problems can be properly solved until the virus itself subsides, and so plasters — funding — will have to do for now.

The person in charge of a stalled economy will often find themselves needing to make passionate statements and bold plans, which — to his credit — is a role that Rishi Sunak has so-far largely filled. The furlough scheme, officially the “Coronavirus Job Retention Scheme”, was a fantastic plan implemented at an effective time. Similarly, the Summer Statement’s plans to lower tax on threatened industries is a pragmatic attempt at resuscitations of sectors on life support. That is largely where the efficacy of his coronavirus recovery plans stop. Sunak’s summer statement masquerades as a genuine attempt at helping the poorest, claiming to hit multiple birds with single stones: for example, subsidised meals out of the house are meant to both help people pay for food and help the businesses they buy it from. Additionally, the replacement of the furlough scheme will, allegedly, wean Britain’s economy off an addictive drug and act as an accelerator for the grand 2021 UK recovery. Investment in housing, combined with the abolition of stamp duty on less expensive homes, should revitalise both construction industries as well as encouraging the circulation of cash throughout the British public.

These benefits will work — but only for the more affluent. The plan, when unmasked, does worryingly little to help the poor: in terms of personal support, the impoverished and deprived get nothing while the wealthier get a subsidised bill on their nights out. In terms of housing support, the impoverished and deprived get nothing while richer, potentially opportunistic families enjoy the benefits of a cheaper new or second home. In terms of the wider economy, poorer businesses and the self-employed get nothing, while richer businesses are able to claim a free handout that only increases as companies grow.

The poorest are often unable to buy even the cheapest food for themselves, especially now as poor people are the least likely to be able to work from home and (as a result) most impacted by the pandemic’s reduced wages and layoffs. How, exactly, are they meant to be able to cough up the extra cash to be able to use their special “£10 off a Pizza Express” meal-deal when they can’t buy a loaf of bread? And how can the government — or Rishi Sunak himself — genuinely expect those who struggle to eat to suddenly be able to afford new houses for themselves?

Socially-distant shoppers queueing for a Sainsbury’s.
These shoppers will soon be able to afford discounted meals out on the town. That is, of course, if they can afford to pay for the rest of the bill. Image: Philafrenzy via. Wikimedia Commons

For businesses, how are companies that are only just kept afloat by the furlough scheme expected to survive past October? Sunak’s plan goes against the pleas of mayors and trade unions up and down the country: ending the scheme in October, as is currently planned, will inevitably result in thousands of businesses going bankrupt as soon as the scheme ends. Poor business owners will simply be unable to retain their staff — and granting £1,000 per employee they retain by January? Doesn’t take a doctorate economist to figure out that only richer businesses — those already able to afford to retain their staff — will be the only businesses receiving Rishi Sunak’s handouts from the taxpayer. The self-employed don’t fare any better: the government’s plans offer no extra help for them than the decisively insufficient existing systems.

Priorities, hypocrisies

Another odd aspect of Rishi Sunak’s coronavirus summer statement was his absolutely batshit priorities. Theatres and the wider arts? Sorted (unless it’s a poorer institution). Housing market? Sorted (unless you don’t have the money to buy a new house). Doctors and nurses? Sorted — sorry, I meant “Nothing”. You should also remember that it was only a few weeks ago that Marcus Rashford forced the government to pay £120 million to stop poor children from starving over the summer holidays. This week, in contrast, Rishi Sunak is throwing away almost £500 million to help richer families enjoy cheaper meals out.

Furthermore, Rishi Sunak’s successful job-saving programme — the coronavirus furlough scheme — is still going to be terminated by the government in October. It will be replaced by the aforementioned January subsidy, in a plan that even Britain’s own HMRC bosses are questioning. It’s no wonder, then, that unions and economic experts are warning of a jobs crash. The Organisation for Economic Co-operation and Development (OECD) cautioned the UK government earlier this week that unemployment in the UK was forecasted to rise as high as 15% if the spread of coronavirus in the UK began accelerating again, and as high as 12% if it does not. The last time UK unemployment was that high was Margaret Thatcher’s 11.9%, reached in the midst of the coal strikes in 1984.

Rishi Sunak’s summer statement is too little, too late. In many ways, his plan endorses catastrophic neglect of Britain’s poorest in a way uncomfortably similar to the policies of Mrs. Thatcher herself. Again: I have no definitive proof that Margaret Thatcher’s mismanagement of the economy is why Conservatives are perceived as the “party of and for the rich”, but the fact that her policies went out of their way to hurt the poor certainly can’t have helped. Rishi Sunak is, of course, not to blame for coronavirus job losses (as Thatcher was for mining job losses) — however, it is certainly Sunak’s job to ensure that the poor are helped through coronavirus. The Conservative budget, once again, does not allow for such things. And the poorest will suffer because of it.

This article was originally published on michaelrh04.co.uk.

I am occasionally someone who writes things, more often at www.michaelrh04.co.uk. Leftist.

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