Chancellor’s words ring hollow as less is spent on levelling up

Responding to the Chancellor’s Spending Review, Helen Barnard, Director of the independent Joseph Rowntree Foundation said:

“Remarkably for a much-hyped statement on levelling up opportunity across the country, the Chancellor’s words ring hollow as weaker local economies will be getting less money than previously[1] in the aftermath of the pandemic.

“The growing numbers of people in or at risk of being pulled into poverty in our country will have taken little solace from the plans laid out by the Chancellor today. The latest economic forecasts are stark and deeply troubling.

“Behind the figures there are real families wondering how they will get through this winter and beyond. The Chancellor has not risen to the challenge facing the nation. In the here and now families need to know how they will pay for food, childcare and keep a roof over their heads.

“The Chancellor has failed to live up to their manifesto commitment to invest significantly in skills around the UK[2] and allow the funds to be administered locally via mayors, devolved administrations and local authorities. The additional funding for employment support is eye catching and necessary because of the anticipated wave of long-term unemployment in the coming months.

“There is mounting concern in the UK about tackling poverty and inequality[3], and the time to tackle these issues is now, as we recover from a crisis which has already hit the worst off hardest. This was a moment when the Chancellor could have taken action to solve poverty – instead many families will now be preparing for still harder times ahead.”

On the failure to guarantee that the government won’t cut the lifeline for people on Universal Credit:

“It is deeply disappointing that the Chancellor is leaving millions to wait out the winter in fear and uncertainty with no reassurance forthcoming that he would not cut Universal Credit as planned in April. There is no conceivable scenario in which this support will not be needed, and inaction risks a sharp rise in poverty.

“The Government also seems to have definitively decided not to help disabled people and carers on legacy benefits who are now facing another year of higher costs and an even greater struggle to get work with no extra help.

“It’s not too late for the Chancellor to do the right thing. We urge the Government in the strongest terms to correct its course and commit to making the £20 uplift permanent and extend it to legacy benefits at the earliest opportunity.”

On the Chancellor’s plans for housing:

“The decision to freeze help with housing costs risks pushing families into poverty and takes away the link to real rents when calculating uplifts. To properly fix the housing crisis the Chancellor could have committed to increase the supply of social housing, with a particular focus on homes for social rent over the next five years.”

[1] The combined value of the Levelling Up Fund (£600m), UK Shared Prosperity Fund (£220m) and Local Growth Fund extensions for 2021-22 is less than the combined annual value of EU Structural Funds (£1.2bn) and the Local Growth Fund (£2bn).

[2] The Conservative’s 2019 General Election Manifesto committed to a National Skills Fund worth £600m per year. Today’s announcements only set out £375m for National Skills Fund in 2021/22.

[3] https://www.ipsos.com/ipsos-mori/en-uk/ipsos-mori-issues-index-october-2020