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  1. Business
  2. Economics
4 August 2010updated 12 Oct 2023 10:55am

Did Osborne listen to Theresa May’s warning?

Home Secretary warned Chancellor that the Budget could break equality laws.

By George Eaton

George Osborne was probably hoping for a quiet summer after an exhausting start to his career as Chancellor, but the row over his regressive Budget has been reignited this morning.

Today’s Guardian features a leaked letter from Theresa May to Osborne, which warned him that spending cuts could widen inequality and run “a real risk” of breaking the law.

In her capacity as equalities minister, May reminded Osborne two weeks before the Budget of his legal duty to consider “how women, disabled people and ethnic minorities are affected”. She added that as these groups are disproportionate users of public services, there is a risk that they will be hit hardest by cuts.

In the most significant passage, she warned Osborne:

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If there are no processes in place to show that equality issues have been taken into account in relation to particular decisions, there is a real risk of successful legal challenge [emphasis mine] by, for instance, recipients of public services, trades unions or other groups affected by these decisions

It’s unclear how Osborne responded to May’s letter, though the Treasury has yet to produce any evidence that such an assessment took place. But there is no doubt that the cuts in welfare spending will hit women hardest.

A gender audit of the Budget, commissioned by Yvette Cooper, found that more than 70 per cent of the revenue raised from tax and benefit changes will come from female taxpayers.

Measures such as freezing child benefit for three years, abolishing the Health in Pregnancy grant and restricting the Sure Start maternity grant to the first child will hit women particularly hard. In response, the Fawcett Society launched its own legal challenge and is seeking a judicial review.

Given that women, the disabled and ethnic minorities are disproportionate users of public services, there was never any doubt that the cuts would fall most heavily on them. It’s now up to the Treasury to prove that, in planning spending cuts, it took this into account.

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