The ‘mini budget’ announced today tells us how the government is choosing to respond to the rising cost of living. For most of us, there is very little good news in today’s announcements. The Resolution Foundation’s analysis tells us that 45% of the gains from personal tax cuts will go to the richest 5% and only 12% will go to the poorest 50%.
Economic decisions have mental health consequences. We hear of people in distress, choosing between heating and eating, and facing significant uncertainty, including about where they will live.
We know that people who experience multiple forms of marginalisation, who may still be reeling from the impact of the pandemic, will continue to be the worst affected.
We’re in a context of mental health reform, with the Mental Health Bill and Mental Health Plan due over the next year. The reality is however, that without real help to raise living standards and protect people from destitution, reform will be a wholly inadequate answer to our current crisis.
What are the headlines?
Tax cuts to stimulate growth are the headline announcement. The planned National Insurance rise is being scrapped and the income tax cut (from 20% to 19% for basic rate earners) is being brought forward to next year.
The 45% rate for those earning above £150000 is being scrapped alongside caps on bankers bonuses. This tells us what we need to know about who this mini-budget is for.
This year, spiralling energy costs have been a source of distress and hardship for many. The announced price cap of £2500 gives us an idea of where bills will plateau out. However, this still represents a significant rise in costs over the last few years. There has been some drip feeding of support, but nothing to give people an adequate safety net and assuage fears.
Interest rate rises continue to be announced. Mortgage payments for those not on fixed rate deals will rise, and this will have a knock on effect on the private rental sector. Many already lack security in where they will live and face unregulated rent rises year on year. Where are the announcements to support renters on the brink of being priced out of their homes? Housing benefit rates remain frozen, and the stamp duty cut won’t help those in most need.
Living with mental distress can mean you are more likely to experience poor housing. Research shows that being under financial stress, like being behind on mortgage payments, in serious debt, and experiencing difficulty paying for fuel increases the risk of experiencing mental ill health.
Many of us have been calling for benefit uprating to be brought forward, in acknowledgement of the clear and dangerous inadequacy of current levels. Instead, today it was announced that those working up to 15 hours a week at National Living Wage and receiving Universal Credit will be pushed to find more or better paying work.
We’ve seen significant and necessary strikes from unions like RMT this year, calling for better working conditions and pay. Included in the announcements were plans to legislate to limit strike action.
Where do we go from here?
Economic growth will apparently benefit us all – supposedly justifying making the City more attractive to business as well as the planned 40 ‘investment zones’. The reality of this is that many will continue to be left behind, struggling in the face of inadequate policy responses.
We need resources in our communities to meet needs but the cost of living impacts these services too. Local and community mental health service providers may struggle to keep their doors open, even in the face of rising need.
Focussing on productivity and growth leaves behind those of us whose contributions are not seen or valued. Many people living with long term mental distress or ill-health struggle to access good jobs. Fluctuating capacity, access needs and caring responsibilities are just some of the factors that impact whether people are in work, and what kind of work they are able to get.
The announcements today don’t reflect the urgency needed or the complexity of people’s lived realities.
Who are we looking to at this time?
We know from speaking to our members that they work to support those in their community irrespective of political will, despite huge challenges in obtaining funding, and the additional barriers that come with belonging to marginalised groups.
We are looking to the work of those standing in solidarity like anti-raids groups, SWARM, London Renters Union and Mad Covid among many many others.
Today’s announcement has clearly shown us the need to continue working in solidarity, and often against the prevailing political norms. Saying no to asking for the bare minimum and imagining a better future, even when it is said to be unrealistic, are critical.