Oxfam speaks out on human cost of austerity

Today Oxfam published their briefing paper, A Cautionary Tale: The true cost of austerity and inequality in Europe. They describe the enormous suffering and waste that austerity measures have caused both in Britain and elsewhere in Europe. As a mental health professional, I’m particularly disheartened that suicide rates are increasing in the UK after years of decline. They’re also on the increase in Spain. I suspect this tragic increase is a reflection of lower standards of living, greater inequality, higher unemployment and the slashing of public services to help vulnerable people.

Oxfam point out that this is a tale they’ve seen elsewhere.

The European experience bears striking similarities to the structural adjustment policies imposed on Latin America, South-East Asia, and Sub-Saharan African in the 1980s and 1990s. Countries in these regions received financial bailouts from the IMF and the World Bank after agreeing to adopt a range of policies including public-spending cuts, the nationalization of private debt, reductions in wages, and a debt management model in which repayments to creditors of commercial banks took precedence over measures to ensure social and economic recovery. These policies were a failure; a medicine that sought to cure the disease by killing the patient.

They also have some unpleasant predictions for the future.

Austerity measures will have impacts beyond their period of implementation. The Institute for Fiscal Studies predicts that poverty rates in the UK will have increased by between 2.5 and 5 percentage points by 2020, equivalent to 2.7 million more people living in poverty.

Europe could have an additional 15 to 25 million people living in poverty by 2025 if austerity measures continue, equivalent to the population of the Netherlands and Austria combined.

At best, the countries most affected by austerity will become the most unequal in the Western world. At worst, they will rank amongst the most unequal anywhere in the world.


Oxfam point out that austerity isn’t even succeeding on its own terms, with most EU countries seeing their debt-to-GDP ratio go up, not down.

Ireland’s return to growth is often held up as an exception to the above. Yet Ireland potentially offers a window into the future for other EU countries, with reports of high levels of regional income inequality, insecure employment and significantly decreased spending power. Moreover, Ireland is highly dependent upon the state redistributing income through taxes and transfers, a feat which is likely to diminish as austerity measures continue to bite.

They call for an end to this failed approach, arguing that the EU should accept that much of the current public debt is simply unpayable, and should negotiate a restructuring or cancellation of the debts. This should be combined with stimulus programmes, investment in public services, strengthening of democracy and fairer taxation.

You can read the full report here.



Welfare – A Review of Cameron’s Speech

Prime Minister David Cameron



Where we look after the elderly and frail.













For free – replacing otherwise paid jobs?


So people are pushed out of their local areas.


Without consideration of family size.










Can we really say that’s fair?







Then he goes on to some of the ‘problems’.









Then then he says











What damages is stigmatisation and expectation of support where none exist.




It damages and must be challenged.

Pic by Prime Minister’s Office – Flickr

Oxfam warns of “Perfect Storm” of UK poverty

Today, Oxfam released a briefing paper: The Perfect Storm: Economic stagnation, the rising cost of living, public spending cuts, and the impact on UK poverty.

The paper warns of an assault from all sides on Britain’s poor, caused by a toxic combination of rising unemployment, declining incomes, increased cost of living, public service cuts, benefit cuts, housing shortages and weak labour rights.

The government‟s rapid deficit reduction measures are hitting the livelihoods of almost everyone in the UK, but the particular approach taken is hurting people living in poverty the most. The focus on cutting public spending rather than raising taxes is deeply regressive, and the blend of tax increases chosen is itself regressive. In addition, both public spending cuts and the tax and benefit changes introduced by this government will have a significantly more negative impact on women than on men.

At the same time, we are seeing a synergy of economic and social needs. Protecting the incomes of the poorest people is crucial for both social and economic reasons. It is people on low incomes who are being hurt the most by the Perfect Storm, and increasing the incomes of the poorest will have the strongest multiplier effect on aggregate demand in the economy. By prioritising and targeting social and economic investment, the government can ensure that it protects the services upon which those in poverty most rely, while helping to boost demand and provide investment in the long-term productive capacity of the economy.

Oxfam are calling for decisive action to safeguard the increasing number of British people living in poverty, which shames our status as one of the richest nations in the world.

Protect the incomes of the low paid, reducing the withdrawal rate of Universal Credit from 65 per cent to 55 per cent to ensure that work pays, and increasing the National Minimum Wage at least in line with inflation or average earnings, whichever is the higher;
Protect people in poverty from the increasing cost of living, by giving new powers to Ofgem to cap fuel prices; introducing a maximum level of interest; and protecting the Social Fund and expanding its resources, to protect people from exploitation and to guard against problem debt;
Protect public services, by using progressive taxation to slow the speed and depth of cuts; ring-fencing the Sure Start grant to local authorities in England; and exploring investing in a national system of universal child care, to make work pay for women and to build the social infrastructure of the country;
Protect the social safety-net, by giving local authorities in England and Wales sufficient resources to maintain existing levels of Council Tax Benefit; monitoring the effect of the Housing Benefit and overall benefit caps; reversing the switch from RPI to CPI inflation for benefit uprating; maintaining real Child Benefit levels; and reversing cuts to child-care support;
Provide secure, affordable, decent housing for all, by investing in affordable homes to boost the economy and to help solve the housing crisis; and increasing maximum penalties for rogue landlords;
Protect rights at work: the weak labour market is adding to the power that employers have over workers, and so it is essential to maintain and enforce the vital protections that do exist for vulnerable workers;
Move towards a fairer tax system by clamping down on tax avoidance; introducing a Robin Hood Tax on financial transactions, to help protect public services and benefits and ensure that everyone pays their fair share; and exploring options for a land value tax; and
Rethink how we measure value: the social damage caused by inequality, high unemployment, and environmental degradation all tell us that it is not growth that matters, but the type and distribution of growth; measuring true social value through a measure of well-being such as Oxfam Scotland‟s Humankind Index will help us to measure whether what we are doing to fix the economy is really, sustainably benefiting society.

While such a paper wouldn’t be so surprising if it came from the likes of, say, UKUncut, this is from a major charity more usually associated with providing aid to the developing world. That they now feel it necessary to speak out about the way we treat our own poor may speak volumes about the increasing levels of inequality and hardship on our doorsteps.

You can read the full briefing paper here.

Reforming Care

There’s a good piece today in the Telegraph by Liz Kendall the Shadow Minister for Care and Older People about the need for the government to push through reforms to the system of funding (and provision) of social care in this country.

The timing is pertinent of course although the message seems to have been around for decades. Tomorrow will be the Queen’s Speech and the government will set out its legislative programme for the next year. With the Dilnot Commission reporting last year it seems that the need for changing the means of funding social care support would be something that may appear tomorrow. My own gut feeling is that it won’t but I’m happy to be wrong on this.

There are two connected but separate issues to the ‘care reform’ debate. One relates to the way that care is funded and that is the issue that Dilnot specifically refers to.

Currently, each Local Authority has it’s own ways and means of determining charges although there is a threshold capital limit of £23,500 above which a person may be liable for charges. There are various computations and methods that these levels and charges are managed but the fact is that means testing is by no means consistent across England – nor is quality and level of provision.

£5000 towards care in Manchester may buy something very different to the same in Chester or Westminster or Norfolk.

There is anger about the ‘working hard all their lives to buy a house and then needing to sell it instead of leaving it to the kids’ argument that I have less time for as I think the exponential rise in property values is less about working hard and more about luck, employment opportunities and an odd housing market but if you are going to deprive people of assets which by default is going to happen as social care won’t be fully funded, it should be done in a fair, equitable and transparent manner.

Currently, I find it almost impossible to explain to someone what charges they may be liable for and it shouldn’t be like that.

Dilnot proposes a cap (which may be changed according to the government) on the amount that would be charged to the individual needing care and I can appreciate that. It is a sum which could be insured against and it is a sum which can be planned for.  However, it would need increased capital funding from central government and there’s the rub.

As for the process of improving quality of care and choice in care. it’s separate but linked. The ‘system’ is starved of cash injection at the moment. Cost has overtaken quality in terms of contracts being meted out by local authorities and choice is a luxury for the few rather than an option for the majority.

The government has been ruthless in their decimation of budgets to local authorities and while we’d all like to think the NHS and local social care budgets are intrinsically linked – the reality is different and the shifting of cost and responsibility between health and social care ‘pots’ is damaging to those who need to use these services.

Work has to be done on the fundamental basis of the way that social care is delivered in terms of ensuring that rights and particularly the right of access to well funded care is open to all. While money will always buy more choice and better facilities (that’s the point of ‘working hard all your life’ if you want to follow that argument) – the provisions meted out to those who are unable to pay ‘top ups’ or arrange their care independently cannot lag behind.

There has to be a more cooperative flow of budgets between health and social care and they have a symbiotic partnership and while there is division, there will be increased costs.

Integration is seen as a ‘watch word’ but to date there has been little in terms of actually working on it in a practical and innovative manner from bottom up.

It becomes an easy word to through around and everyone around the table can nod and smile and say ‘yes, we need to do that’ but what is needed is solutions not a continual detailing of problems (although problems do need to be identified of course – but sometimes I feel that’s all that happens!).

So let’s watch and see if the government do pick up the challenge tomorrow – I suspect we won’t see any changes but I hope to be pleasantly surprised..

It is worth remembering though that the provision of Dilnot would appeal to the demographic the government wants to attract but it would be at a considerable cost.

I will watch with interest.

Four Seasons, Private Equity and the Care Sector

Money Talks - Do you listen?



















Tomorrow, this will be the hospitals.

picture by w4nd3rl0st at Flickr

Is there really ‘Crisis’ in Care?












Work! Fair?

There has been much recent debate about the extension of the idea of ‘workfare’ in the UK. ‘Workfare’ is supposed to be an extension of ‘welfare’ seen by the syntax used in the word itself. It is an idea which grew from the idea that people should not receive benefit entitlement as a result of unemployment without ‘giving something back’. In the context in which I’ll be using it, it refers to mandatory work ‘placements’ for people who are not able to secure employment in order to receive benefits that relate to being out of work.  It sounds quite warm and fluffy because of course people should be helped into work and ‘give something back’ but the word also implies a series of sanctions of this work is not undertaken.

Outside the Jobcentre
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