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New Communist Party of Britain

adopted December 2015

Austerity is an attack on workers

One of the first acts of the Conservative, Liberal‑Democratic coalition (Coalition) government, in 2010, was to attack welfare benefits which led to the introduction of the Welfare Reform Act 2012. This act was nothing other than an attack on the working class and to put into law billions of pounds of cuts to the social wage. During its time in office the Coalition government continued to reduce the income of working people. In 2015 unfettered by their Liberal‑Democrat colleagues the Conservatives increased their attacks against working people in their first Budget and their Trade Union Bill which sought to reduce the effectiveness of Trade Unions.

They claimed that the purpose of the Welfare Reform Act 2012 was “to simplify the benefits system in order to improve incentives to work” and advanced the proposition that the benefits system is too complex and has perverse incentives that make people decide not to work. It saw the roll‑out of Universal Credit which will replace housing benefits, tax credits, and income‑related Jobseekers Allowance.

The system of allocating the social wage is in need of simplification, so as to make it easier for people to claim the £10 billion of benefits that goes unclaimed every year. But the Conservative’s idea of simplification is to make it more difficult for people to claim, to make less money available and to make it easier for the authorities to stop paying.

The Welfare Reform Act 2012 introduced tougher penalties to reduce fraud and error, which seemingly costs the country £1.5 billion annually, the introduction of the Act has seen a huge increase in sanctions against claimants for the smallest of reasons, and with Universal Credit these sanctions will lead to the withdraw of all benefits. The supposed savings the act hoped for and the other cuts that have been imposed is dwarfed by the tax breaks given to business or the accounting methods used by the ruling class to avoid paying £120 billion of tax each year.

During the course of 2010‑2015 the Coalition government had -

The attack on workers continued through the spring of 2015 culminating in the summer budget of 2015 which -

These changes are clearly part of the ruling class agenda to dismantle state welfare and return us to the Victorian days where paupers — the unemployed, elderly, sick, long‑term disabled and unsupported single parents — were forced to claim benefit from their local parish or borough. The criteria for eligibility varied from one locality to another but boroughs were anxious not to be seen as generous because this would attract paupers from outside the area and create an extra burden on the rates. Claimants were often refused benefits if they tried to claim outside the parish or borough where they were born as local authorities tried to shift responsibilities from one to another.

Strictly speaking housing benefit and tax credits paid to people in work, but on low incomes, are not welfare benefits. Housing Benefit is paid, via the hapless tenants, to landlords and enables rents to be sustained way above the level a truly free market would create. In 2014 the housing benefit bill had reached a new high of £25 billion a year, even though the number of claimants has not significantly changed since 1979, this money has gone directly to landlords.

Tax credits paid to those in work allow employers to pay wages well below what a truly free market would permit. They should be abolished by raising wages to enable workers to live a tolerable life without recourse to taxpayer‑funded top‑ups. These credits subsidise the profits of employers at taxpayers’ expense.

Furthermore housing benefit and tax credits undermine working class unity by creating a situation where low‑paid workers actually suffer a cut in total income when they win a pay rise through normal wage bargaining because these “benefits” are then withdrawn.

What the Conservative government never highlights is that Britain has one of the lowest levels of benefits in western Europe, with unemployment benefit of just £72.40 per week for those over 25 and £57.35 for those under 25.

The cuts to the social wage must be reversed and pay increased significantly. This can be done by Communists, socialists, trade unions, disability and pensioner organisations working together to confront the ruling‑class. Though the immediate demand must be to reverse the cuts and to extend the social wage there must be a political campaign led by the New Communist Party that demonstrates that the social wage can only become a permanent feature by workers taking state power.