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Of course the sugar tax is regressive. So is sugar

The obesity crisis disproportionately affects the poor.

There are already as many arguments against the sugar tax as there are sugary drinks that will fall under its ambit. In yesterday’s Budget, George Osborne announced two new levies: one on drinks with a sugar content above 5g per 100ml, and another higher levy for drinks with more than 8g sugar per 100ml. The levies will work out as either an 18p or 24p surcharge – which the Office for Budgetary Responsibility (OBR) expect to be passed on entirely to the consumer.

Though Jeremy Corbyn signalled his support for the measure in his response to the Chancellor in the Commons yesterday, there is an emergent left-wing critique: that the sugar levy is regressive, and therefore unjustifiable.

The charge of regressiveness is undeniably correct: as with other consumption taxes, the levy will represent a disproportionately large share of poorer people’s incomes.

Well of course it’s regressive. So is sugar and so are its effects. The country’s obesity crisis – and it really is a crisis when almost two-thirds of adults are either overweight or obese along with a quarter of young children - disproportionately affects the poorest.  Findings drawn at the end of last year from the Millenium Cohort Study, which tracks nearly 20,000 British families, found a stark link between relative poverty and childhood obesity. By the age of just five, poor children were almost doubly likely to be obese than their better off peers.

Of course sugar consumption does not explain all, or even most, of that relationship. Still, high sugar intakes are a cause of obesity, and obesity is a cause of type 2 diabetes, which has risen by 70% in a decade.

If obesity and its effects disproportionately hit the poor, why should it be any surprise that a measure to tackle obesity disproportionately affects the poor? That’s the whole point. A tax with the intention of changing behaviour is obviously going to affect the people who behave in that way.

But surely the nub of the issue is this. The OBR anticipates a reduction in demand for sugary drinks of between 0.8% and 1% for each 1% price rise resulting from the levy. A diminution of demand for sugary drinks will help decrease their risks of obesity, diabetes and other health problems. If you accept that the government has a responsibility to ameliorate public health then you should accept this levy. If you are an instrumentalist about these things, less illness means a reduced burden on the NHS. Spending on diabetes and diabetes-related illnesses accounts for 10% of the budget of the NHS in England and Wales.

That’s not to say the levy is a silver bullet. There are background socioeconomic factors which mean that the most poor too often consume unhealthy diets. Further benefit cuts are hardly going to help in that regard. And there are various other strategies that have been shown to depress consumption of sugary drinks, such as different marketing strategies in supermarkets. It’s also peculiar that milky drinks and fruit juices are to be exempted from the levy - not because they are only consumed by the middle classes, but precisely because they are consumed across society by people who do not have healthy diets. 

But none of those caveats should obscure this fundamental fact. Yes, the sugar tax is regressive. So is sugar consumption and so is obesity. This is a regressive attack on a regressive malaise and it should be applauded.

Henry Zeffman writes about politics and is the winner of the Anthony Howard Award 2015.

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Universal Credit takes £3,700 from single working parents - it's time to call a halt

The shadow work and pensions secretary on the latest analysis of a controversial benefit. 

Labour is calling for the roll out of Universal Credit (UC) to be halted as new data shows that while wages are failing to keep up with inflation, cuts to in-work social security support have meant most net incomes have flat-lined in real terms and in some cases worsened, with women and people from ethnic minority communities most likely to be worst affected.

Analysis I commissioned from the House of Commons Library shows that real wages are stagnating and in-work support is contracting for both private and public sector workers. 

Private sector workers like Kellie, a cleaner at Manchester airport, who is married and has a four year old daughter. She told me how by going back to work after the birth of her daughter resulted in her losing in-work tax credits, which made her day-to-day living costs even more difficult to handle. 

Her child tax credits fail to even cover food or pack lunches for her daughter and as a result she has to survive on a very tight weekly budget just to ensure her daughter can eat properly. 

This is the everyday reality for too many people in communities across the UK. People like Kellie who have to make difficult and stressful choices that are having lasting implications on the whole family. 

Eventually Kellie will be transferred onto UC. She told me how she is dreading the transition onto UC, as she is barely managing to get by on tax credits. The stories she hears about having to wait up to 10 weeks before you receive payment and the failure of payments to match tax credits are causing her real concern.

UC is meant to streamline social security support,  and bring together payments for several benefits including tax credits and housing benefit. But it has been plagued by problems in the areas it has been trialled, not least because of the fact claimants must wait six weeks before the first payment. An increased use of food banks has been observed, along with debt, rent arrears, and even homelessness.

The latest evidence came from Citizens Advice in July. The charity surveyed 800 people who sought help with universal credit in pilot areas, and found that 39 per cent were waiting more than six weeks to receive their first payment and 57 per cent were having to borrow money to get by during that time.

Our analysis confirms Universal Credit is just not fit for purpose. It looks at different types of households and income groups, all working full time. It shows single parents with dependent children are hit particularly hard, receiving up to £3,100 a year less than they received with tax credits - a massive hit on any family budget.

A single teacher with two children working full time, for example, who is a new claimant to UC will, in real terms, be around £3,700 a year worse off in 2018-19 compared to 2011-12.

Or take a single parent of two who is working in the NHS on full-time average earnings for the public sector, and is a new tax credit claimant. They will be more than £2,000 a year worse off in real-terms in 2018-19 compared to 2011-12. 

Equality analysis published in response to a Freedom of Information request also revealed that predicted cuts to Universal Credit work allowances introduced in 2016 would fall most heavily on women and ethnic minorities. And yet the government still went ahead with them.

It is shocking that most people on low and middle incomes are no better off than they were five years ago, and in some cases they are worse off. The government’s cuts to in-work support of both tax credits and Universal Credit are having a dramatic, long lasting effect on people’s lives, on top of stagnating wages and rising prices. 

It’s no wonder we are seeing record levels of in-work poverty. This now stands at a shocking 7.4 million people.

Our analyses make clear that the government’s abject failure on living standards will get dramatically worse if UC is rolled out in its current form.

This exactly why I am calling for the roll out to be stopped while urgent reform and redesign of UC is undertaken. In its current form UC is not fit for purpose. We need to ensure that work always pays and that hardworking families are properly supported. 

Labour will transform and redesign UC, ending six-week delays in payment, and creating a fair society for the many, not the few. 

Debbie Abrahams is shadow work and pensions secretary.