How tomorrow's budget can be better for women

This guest post from Demos Director Kitty Ussher is an extract from the forthcoming Fabian Review gender equality special.

We know that the Government did not consider the effect of the June 2010 Emergency Budget on women because the Fawcett Society took them to court for not publishing a gender impact assessment. That this legal action was possible was a tribute to the work of the outgoing Labour government in getting the Equality Act onto the statute books in time. As a result they DID have to consider the effect on women of the Comprehensive Spending Review that happened a few months later. Given that this discipline does not appear to have altered the general direction of policy, however, means it is unlikely to have been a constraining factor.

In fact, the Government’s strategy for achieving the cuts was set early on. The main tax rise was VAT, the fairness of which has been hotly debated but it is certainly more regressive than, say, income or wealth taxes, almost by definition. The single largest spending cut comes from the decision to lower the rate at which benefits are automatically uprated by each year to take account of inflation. They have simply decided to use a less generous measure of inflation when doing this, because it is cheaper. By definition this will hit the poorest harder, extracting £6bn from the least well-off by 2014-15. It is also politically clever, by penalising those with the quietest voices in a way that they won’t even notice: the absolute cash amount of these benefit payments will still rise, but people will just find that their money goes less far. Is this a gender effect? No, because men and women are equal in their receipt of benefits. ONS data shows that 16 per cent of men and 15.8 per cent of women are benefit recipients. Although frankly a deliberate attempt to cut insidiously from the poorest doesn’t need a gender effect to feel wrong.

Where the cuts will really bite are on jobs and local services and this is where the real gender impact needs to be better understood. The coalition decided to push much of the difficult choices down to local government. Again, good politics as it removes them from the front line of responsibility for unpopular decisions and diffuses potential opposition throughout the country; different choices will be opposed in different ways in different places.

In total, however, these cuts to local services are potentially the most disruptive to women as they have the greatest potential to disturb the delicate local ecosystem of family support. In total around £7bn will be lost from local councils by the end of the spending round, and they are being severely incentivised not to raise council tax to compensate. Every time a youth club closes (the police told me of three closing in my area), a sports facility is withdrawn (remember free swimming for children?) or an after school club or nursery raises its fees because the council grant is slashed (just ask, it’s happening) then it becomes that little bit less viable for some parent somewhere to work. This is the real gender impact of the cuts. In many cases, those affected will be those whose position in the labour market is already the most precarious: people juggling multiple responsibilities with no time to invest in their skills and raise their salaries. Many are precisely those front line public sector workers who will find their jobs in any case under threat. They could find their job and childcare threatened at the same time, making it just simply more sensible for them and their family for them to withdraw from the labour market if that choice is available to them. Maybe that’s exactly what this government wants them to do? In the long run the wasted potential and opportunities that flow from these pressures could have a profoundly negative effect on women’s equality in the workplace.

So what could be done in the budget to avert this problem? Obviously there should be a cap on the fees of after school clubs and nurseries and any form of government-supported services for young people. Also, more time for councils to negotiate shorter and flexible hours for all their employees – men included – rather than job cuts for all the lowest skilled. And to pay for this? Perhaps counter-intuitively, I would completely scrap child benefit, rather than just tinkering around in an illogical way at the edges. It’s an out of date and clumsy mechanism. Payments for the additional costs of having children should of course still exist but they should be properly means-tested rather than being a flat payment per child, and the savings used to increase dramatically both demand (through vouchers) and supply (through councils) of affordable childcare and youth provision. This should be a top priority. It wouldn’t stop the cuts but it would do a lot to ensure that the gender impact really was mitigated.

Kitty Ussher is the Director of Demos

The magazine also includes research by Howard Reed of Landman Economics, which Polly Toynbee responds to in the Guardian today. Details of Howard's research can be found on the Fabian Society website.