Trade unions have responded to today’s Budget statement by Chancellor of the Exchequer Rishi Sunak, with some calling it a “failure”, “short-sighted” and a “missed opportunity”.
Chancellor Rishi Sunak today outlined tax rises on companies and workers to help pay for an additional £65bn of financial support required to see the country through the Covid-19 pandemic, taking total government spending on the pandemic to more than £400bn.
In his Budget statement in the Commons, Mr Sunak confirmed that he would extend the furlough scheme to run until the end of September and allocated billions of pounds in business grants and tax cuts to help employers while lockdown restrictions remain in place.
However, he went on to say that the rate of corporation tax would need to increase to 25% for the most profitable companies in Britain from April 2023, while also unveiling plans to raise billions more from income taxes by freezing the threshold at which workers start paying them until 2026.
Other measures announced in today’s Budget include:
- The Self-Employed Income Support Scheme (SEISS) will be extended
- Restart Grants to help businesses reopen
- A new Recovery Loans Scheme to replace the ‘Bounce Back Loans’ and Business Interruption Loans schemes
- Extension of 100% business rates holiday and VAT reduction for hard-hit sectors
In response, union leaders have been quick to criticise a Budget that they believe does not go far enough to support workers.
Usdaw general secretary Paddy Lillis said that the Budget goes “nowhere near far enough” to address the issues currently faced by the retail sector, labelling it a “missed opportunity”. He said: “The short-term sticking plasters that the Chancellor announced in today’s Budget go nowhere near far enough. They don’t tackle the fundamental issues that the retail industry already faced before the pandemic, let alone give retailers a fighting chance of mounting a recovery.
“Extending furlough by six months, short-term business rates reductions and one-off grants do not allow retailers the opportunity to plan their recovery out of the pandemic and secure jobs. Huge issues like expensive rents and rates, along with unfair taxation continue not to be addressed by the Government. Today’s Budget is yet another missed opportunity.”
UNISON general secretary Christina McAnea criticised the Chancellor for being “strangely silent on public services”, with the Budget failing to provide extra funding for the social care system. She said: “The Chancellor had much to say on how to revive the economy but was strangely silent on public services. Workers and services at the heart of the country’s pandemic will be more concerned with what Rishi Sunak – so keen to stress his honest approach – didn’t announce today.
“There was no extra money for a social care system on its knees. Staff are highly skilled but lowly paid and barely earn the legal minimum. No funding lifeline for councils struggling to provide services holding communities together. No mention of cash to raise the morale of exhausted NHS workers and grant the pay rise they’ve more than earned. Nothing for key workers who’ve given their all, not a single helping. The government has an odd way of saying thanks.
“It’s no way to treat staff who’ve put their lives on the line, gone out of their way to care for our loved ones and kept the country going in the pandemic’s darkest days.”
In a statement released after the Budget announcement, Unite said the Budget “fell short of what was needed to rebuild the economy and protect people’s jobs, health and incomes.”
Commenting on the extension of the furlough scheme, Unite general secretary Len McCluskey said: “Although still short of the support provided by competitor nations, these extra months of furlough support offer some stability in the rocky months ahead.
“We’ll keep looking for an extension to 2022 because there is still tremendous uncertainty out there. We also urge the chancellor to do more to repair the economic conditions further by stabilising household incomes.
“Furloughed workers have been living with a twenty per cent cut in their wages for the best part of a year now, amassing hefty debts. This will need to be addressed by government because depressed incomes will hold back the recovery, further cementing inequality.”
Meanwhile, Unite’s Assistant General Secretary for Politics & Legal, Howard Beckett responded labelled the freeze in the income tax threshold as “a war on the low paid”, saying on Twitter:
The Tories have just introduced a £7,000 million stealth tax on workers.
The freeze of the income tax threshold, your personal allowance, is a war on the low paid.
— Howard Beckett (@BeckettUnite) March 3, 2021
The NEU’s joint general secretary Kevin Courtney called the Budget “short-sighted” and criticised the Chancellor for not providing schools with no new resources to help manage coronavirus. He said: “It is short-sighted and disappointing that the government continues to ignore the funding pressures the education sector faces.
“The government has said schools are a “national priority”, yet this Budget has provided schools with no new resources to manage coronavirus. Once again this government has failed to pay attention to the educational professionals who see first-hand, every day, the detrimental impact under-funding of our education system has on the children and young people they teach or care for.”