Impact of austerity on deprived neighbourhoods

The coalition government's austerity programme is mainly hitting those people who depend on vital support from public services and social security, according to a new study from the New Economics Foundation think tank.

The study focuses on how people in two of the most economically deprived parts of England – Birmingham, and Haringey in north London – have been experiencing the cuts over the last two years. 

Key findings

  • The main groups caught in the firing line are people who are unemployed, on low wages, very elderly, young, and/or disabled.
  • Everyday insecurity is now a common experience, caused by the rising cost of living; unemployment and/or precarious, part-time and poorly paid employment; changes to social security; and debt. People feel they are losing control over their lives – with scarcity of money and time closing down their options. They feel powerless in the face of change and have 'little hope for a future they cannot control'.
  • The safety net is unravelling. Benefits and tax credits are becoming less generous, more conditional and increasingly punitive. The divisive rhetoric of 'strivers versus skivers' demonises people who are unable to work through no fault of their own. There are growing risks of food and fuel poverty, homelessness and indebtedness. Services that could help meet these needs, such as social care, child care, youth services, housing services and legal advice, are all being restructured and reduced. Services aimed at preventing needs arising or getting worse are being cut back, piling up problems for the future.
  • There is a growing prevalence of precarious working conditions, zero-hours and temporary contracts, underemployment and very low wages. Jobs like this push people into in-work poverty. Many are caught in a 'low pay, no pay' cycle, oscillating between short spells of poorly paid employment and unemployment. Low wages have helped employers to keep employees in work: but more people are now involuntarily under-employed than before the recession.
  • Cuts to public services and tax credits are placing an impossible burden on people who have to step in and look after family members while doing paid work. As demand for care rises, a growing strain is placed on unpaid human resources and relationships. Women are most often left to pick up the pieces. For many, this added burden brings emotional stress, decreased well-being and loss of earnings.
  • The coalition's 'Big Society' project has gradually disappeared from public and political discussion. The new austerity means that those who are poor and powerless have less time and fewer resources at their disposal, making it much harder to get involved in local activities, take over local assets at risk of closure, bid to run services, or develop neighbourhood plans.

Source: Julia Slay and Joe Penny, Surviving Austerity: Local Voices and Local Action in England's Poorest Neighbourhoods, New Economics Foundation
LinksReport | NEF blog post | Charity Times report 

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Publication date: 
Aug 16 2013