The devil is in Spending Review’s detail

There were lots of big headline announcements that no doubt, other more esteemed commentators than the burd will report on and analyse.  But there was one helluva lot of detail in the Spending Review to digest as well.  As Krishnan Guru-Murthy of Channel 4 News suggested on Twitter:  *Way too much to take in. Can we have a couple of days off to process this and come back on Friday?*.  Indeed. 

However, a couple of the welfare reform announcements (which were rattled off by Osborne at breakneck speed) have already caught the burdz eye.  One hits the poorest, most marginalised in our society hard, the second will impact on the squeezed middle, particularly in Scotland.

The first removes the mobility component of disability living allowance (DLA) from people living in residential care.  The mobility component is paid at two levels, lower at £18.95 or higher at £49.85 per week.  Currently few disabled people living in residential care – and this includes children at a residential special school – receive DLA care component.  The only bit of money they get to themselves is the mobility component.  It’s important because few residential facilities provide free transport.  Even education authorities are trying to wangle out of paying for school transport – I kid you not.   Even where transport is provided, the mobility component provides a small amount of independent income enabling people in residential care to enjoy a small amount of independence.  The cost of a taxi for example to get to essential hospital appointments, or to go shopping, or even to meet friends at the pub or for children in residential schools over the weekend to get out and about and take part in activities in their community.  Or visit their families.  Disabled people are like everyone else – they want to do the things that the rest of us take for granted.

So removing this benefit is a hammer blow to people’s independence as well as their pockets.  For some, the mobility component may be the only income they have.  Removing it effectively makes them prisoners of the state and at the whim of others to get them from A to B. 

Worst of all, the savings are paltry.  According to HM Treasury’s report, £60m will be saved in 2012-13, £130m in 2013-14 and £135m in 2013-14.  A total of £325 million over 3 years.  Crumbs frankly.  Yet at huge cost to the individuals affected.  Numbers of children attending residential schools in Scotland?  Probably around 500.  Many of them far from home and amongst the most vulnerable, marginalised children in our society.  It’s enough to make the burd weep.

The second announcement concerns child tax credit and the plan to reduce the amount of childcare tax credit payable.  It means that anyone claiming for childcare costs will only be able to get a maximum of 70% of those costs met (depending on income which just makes it even more horribly complicated) instead of the current 80%.  This unsurprisingly will hurt those families in the squeezed middle (that’s incomes of around £17k to £35k) hardest and will also hurt families with the youngest children.  And it could hit families in Scotland particularly hard.

The DayCare Trust has consistently found that Scotland has the second highest childcare costs in the UK, behind England.  A fulltime nursery place in Edinburgh for a child under 5 is in the region of £170 per week (based on the burdz own experience).  Reducing the childcare element to 70% could add as much as £780 to a family’s annual childcare bill.  Even taking the average cost of childcare in Scotland, £4368, a family could be worse off by £437.  And that’s without factoring in the extortionate cost of holiday childcare.  Or indeed the impact of other changes to tax credits announced in the budget in June and also today.

So all those lone parents that are now being pushed into work and thrown off of benefit will have to find more to meet their childcare costs.  God only knows how those in London whose housing benefit is also going to be scythed, will cope.  What was that about making work pay Mr Osborne?