STUC: Austerity budget would be a crushing blow for workers and their communities

October 26th 2021

STUC: Austerity budget would be a crushing blow for workers and their communities

October 26th 2021

Ahead of the Chancellor’s Budget on Wednesday the STUC has warned against an austerity budget that would be a crushing blow for workers, strangle the recovery and set the worst possible conditions for green growth.

With inflation heading to 5% and the proposed increases in National Insurance next year, wages are set to fall in real terms leading to increased pain for workers and the likelihood of growing industrial unrest. The STUC argues that near-zero interest rates mean that the government’s debt service payments are now at their second-lowest level since 1950. This should encourage the Chancellor to follow the example of the US and other major economies and initiate an ambitious public investment programme. The UK is currently second last among G7 economies for its green recovery investment. Scaled by population, the UK’s green recovery investment plans are just a quarter (24%) of France, a fifth (21%) of Canada, and 6% of the USA’s plans.

STUC General Secretary Roz Foyer said:

“While some in his party seem finally to have got the message that this is the worst time to reduce spending, all the indications are that the Chancellor is planning a return to discredited austerity economics.

“We need action for workers whose wages are rising lower than inflation with particularly support needed for the lowest paid. We are calling for a reversal of the National Insurance hike and of the cruel £20 cut to Universal Credit.”

“Despite a great deal of smoke and mirrors in the Chancellor’s announcements over the past 18 months, it is crystal clear that he is failing to make the necessary investments in our future. Rather than kill off any hope of creating the new jobs we need in the green economy, the Chancellor should be announcing a major fiscal stimulus that could create hundreds of thousands of good jobs and give hope to young people.”

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