Praxis’ statement on the Spring budget
On 26th March the Chancellor announced an enormous £6.4bn in cuts to health and disability benefits by 2029/30. As part of these cuts, at least 800,000 people will lose out on Personal Independence Payments, a benefit paid to those with long-term health conditions. These cuts put the government’s commitments to cutting child poverty and tackling homelessness at serious risk.
Before the cuts, the latest figures from the Department for Work and Pensions showed that child poverty reached almost 4.5 million last year – the highest level since comparable records began over 20 years ago. Migrant families were already overrepresented in these figures, facing twice the risk of poverty.
The government’s own impact assessment estimates 3.2 million families will be affected by the cuts, losing on average £1,720 per year compared to inflation in 2029 and 2030. That is set to plunge 250,000 people into poverty, including 50,000 children, by the end of the decade. Meanwhile, military spending received a £2bn increase in funding, revealing the hypocrisy surrounding the ‘affordability’ myth at the heart of the welfare cuts.
We know it’ll be the poorest women, disabled people, people of colour and single parent families who will bear the brunt of these cuts. That includes the people we work with. Over half of the people we spoke to in the Praxis community told us they had cut down on the size of meals or skipped them entirely because there was not enough food.
These cuts, against the backdrop of ‘Awful April’ where water bills, energy prices and council tax are set to rise, risks stretching the finances of millions of people on the lowest incomes to breaking point. This is especially true for many migrant families who, on top of this, have to pay thousands of pounds every few years for visa fees and charges.
Through our work at Praxis, we help people facing precarity and destitution to access the support they are entitled to. These cuts will cause people to experience further distress in a context where many are already suffering greatly. What’s more, this approach helps to create a context where division in our communities and far-right hostility can thrive.
At a time when inequality is widening significantly in this country, the Government refuses to consider redistributive measures to tax wealth and not work. While they choose to squeeze the pockets of the poorest, UK billionaires saw their wealth increase by £35m a day to £182bn – enough to cover the city of Manchester in £10 notes almost 1.5 times over.
Rachel Reeves is pursuing a growth strategy that will hit the poorest in our society the hardest. Her strategy is not only morally unjustifiable, but also ineffective. Research by the IMF and OECD has shown that growing inequality is associated with greater economic instability as well as lower rates of long-term growth. These estimates have found that overall economic growth in the UK would have been six to nine percentage points higher in the past 30 years had income inequality not risen. It is hard to see what will grow as a result of her policies - apart from poverty, instability and fragmentation.
If this Government is serious about fulfilling its commitments to reducing child poverty and homelessness, it needs to invest in a stronger social safety net. Ending No Recourse to Public Funds and shortening routes to settlement are key reforms that would provide the stability and security necessary for our communities to flourish.
14 years of austerity under the Conservatives has left this country divided, deprived and devastated. This Labour Government was elected on a mandate to raise living standards, invest in public services and deliver economic stability. The Spring Statement fails on all of these counts.
We urge this Government to drastically change course to avoid more families being pushed into deep poverty, more people forced to sleep on the streets, and more division between our communities. We know another way is possible – it’s up to the Government to act.
14th April 2025