So, we all remember when George Osborne had the OBR secretly leave out 550,000 public sector workers from its calculations, change its forecast methodology, and all in all reduce its estimates of job losses by 175,000.
The Comprehensive Spending Review is full of this sort of trickery. Take the “distribution analysis” in Annex B. This is the bit that’s meant to demonstrate “progressive austerity” and a few other convenient oxymorons. This is the bit that the Institute for Fiscal Studies isn’t keen on.
The key detail here is that the CSR admits (quietly) that their analysis doesn’t cover about one third of the tax-and-benefits system. Also, they put a lot of effort into trying to quantify usage of benefits in kind such as the NHS, schooling, universities, social services, etc, but say much less about cash benefits and tax credits.
After all, it’s the bennies in kind (some of them) that haven’t been cut as much, and there is no comparable chunk of public services that have been left out. You will look in vain for a list of the exclusions in the CSR - they’ve simply decided not to mention a bunch of stuff, and not said what is missing.
Notably, housing benefit, council-tax benefit, disability allowance, employment support allowance, and tax credits aren’t in there. And literally all the exclusions are explicitly targeted for cuts elsewhere in the document. Further, the CSR decides to use quintiles (20% groups) not deciles (10%) and to put up with the loss of information, probably in order to avoid the fact that the bottom 10%, the poorest of the poor, came off worst. Except, of course, when they do want to use them.
The BBC’s Stephanie Flanders has a nice summary:
However, if you rank households by spending rather than income, which the Treasury also does in some of its tables, the bottom 30% of households are all contributing more to the deficit reduction effort, as a share of their spending, than the top 10%.
Actually, if you work at it, you can get some of the facts from the CSR document - chart B5, page 99, shows that the total package hits the poorest 10% and the richest 10% hardest. But this is only the case because of tax rises on the richest 10% that originate in the Budget. The CSR hits the lowest three deciles harder than anyone else - something which is made as difficult as possible to see by not quoting the benefit in kind numbers relative to income rather than total benefits in kind. (Left Foot Forward has a go.)
The real shocker, though, is when you parse out the effects of the last Labour budget, as the IFS analysts do on slide 7 of their presentation - whether you prefer their numbers, or the Treasury’s “Cuts With The Cuts Taken Out” version, it’s Alistair Darling’s tax rises on the rich that’s keeping the whole exercise from being purely predatory.
Their last slide points out something that’s been remarked elsewhere - child hate. As with the child benefit row and the June budget, if you have children, you lose out. Not only do families with children lose more than anyone else, but the degree of regressivity through deciles 1 to 9 - i.e. before the Darling tax effect kicks in - is steeper.
So, what does Nick Clegg have to say</a<?
if you look at some of the announcements we made yesterday, and add that to some of the announcements we made in the budget, I think the picture is a little bit more balanced than people are saying.
Well, if by budget you mean “Alistair Darling’s budget”.