Good Old Tories.

The Conservative Chancellor of the Exchequer has just unveiled his emergency budget for the UK economy. Obviously this a very long and detailed announcement that will take time to fully digest. I've got to go shopping this afternoon so a full analysis will have to wait until tomorrow. In the meantime though;

The main objective of this budget is to begin to reduce Britain's huge national debt by cutting government spending. In true Conservative party style George Osborne has set about doing this by attacking children and the disabled, two sections of society who are least able to answer back.

The major areas of cuts will be;

Child tax credits. These are basically tax breaks for working families with children. This budget will remove the baby rate effectively closing the scheme to new members. It will also stop paying it to families who have a total income above £40,000 per year. That means it will now no longer be paid to dual income families earning the average national wage. Child benefit which is money given to parents to help pay for their child upbringing will be forzen regardless of the inflation rate that is expected to spike.

Disability Living Allowance. This is a benefit paid to people with disabilities to help them meet the costs of living with that disability such personal care nurses etc. The system will be changed from an application and medical assessment system to a pure medical assessment system. These assessments are carried out by private medical providers who have complicated payment mechanisms with the Department of Work and Pensions (DWP) who pay disability living allowance. Although no details have been announced I suspect that these payment mechanisms will include provisions for the people carrying out the medical assessments to earn more money by reducing the number of people they assess to be eligible for disability living allowance.

Housing Benefit. This is a benefit that is paid to meet the cost of housing. It is paid to people who are unable to meet their own housing costs through unemployment, disability or low pay. The system by which it is now paid will do away with the provision that it must provide suitably sized accommodation. So previously if you were family with two parents, one son and two daughters housing benefit must have met the cost of a three bedroomed property. By doing away with this provision there is likely to be a large increase in the number of families being forced to live in overcrowded accommodation which is already a significant social problem. The budget has also set a maximum rate at which housing benefit will be paid. Although I'll have to check I believe this is below the market rate. That means the housing benefit system will no longer be able to operates as a way to support people in the private housing sector. Instead it will become even more of a cash cow for unscrupulous housing associations and corrupt landlords linked to local councils.

Also Value Added Tax (VAT) will rise for 17.5% to 20% in January 2011.