According to Frank Field, a Labour MP, the Conservative government will spend £37 billion less on benefits for working-age people by 2021, which is a reduction of about a quarter. The effects of this scaling down are even bigger than they sound, because the prices of everything (known as inflation) have also gone up in the last decade, meaning the same amount of money doesn’t go as far as it used to.
Many of the arguments around this issue come down to people’s values about how money should be shared out in an economy. A lot of Brits think it’s morally indefensible to take benefit money away from people who are poor and struggling. Even if charities step in instead, they worry that this sort of help is precarious (charities could not raise enough money and go bust) or unevenly distributed (lots of charities focus only on their local area, for example).
Other Brits say it’s not right that employed taxpayers (who fund government spending) should be forced to give up lots of the money they’ve worked for, and that generous benefits will only encourage people to stop working or have more children, making the cost to the government bigger and bigger over time. They think charities are a fairer way to deal with the problem, because donors can choose when and how much to donate.
We live in the same neighbourhood, area, country, and planet with about seven billion other people, and our economies inevitably overlap all the time. That means the economic choices we make might have consequences outside our control, and someone else’s choices might have a direct effect on your economy – even if you’ve never met them before…