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29 October 2021

How does Rishi Sunak’s 2021 Budget affect voters in the Red Wall?

Are the Chancellor’s tax-and-spend plans better for traditional Conservative constituencies or new Tory voters in the north and Midlands?

By Michael Goodier

The Chancellor has delivered his Budget, and the winners and losers are becoming clear.

The changes to spending he announced will help low-income workers by raising the minimum wage, cutting the Universal Credit taper rate and ending the public sector freeze. In contrast, the unemployed and middle-earners are facing a squeeze, due mainly to high projected inflation rates.

[See also: Who will benefit from Rishi Sunak’s Universal Credit taper rate cut in the Budget?]

But how do these policies affect the country geographically? Do they back up Prime Minister Boris Johnson’s “levelling-up” agenda to rebalance the economy, and will they benefit new Tory voters in the so-called Red Wall the most?

Exclusive New Statesman analysis of key Budget measures maps out their impact on Britain’s constituencies.

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Universal Credit taper rate cut

People living in Conservative-held seats are most likely to benefit from a reduction in the Universal Credit taper rate, while those in Labour seats will be most disadvantaged by the government cutting the £20-a-week Universal Credit uplift.

[See also: Will the £20 Universal Credit cut become Boris Johnson’s government’s worst decision?]

Labour seats tend to have a higher proportion of people on Universal Credit, but on average, claimants in Tory constituencies are slightly more likely to be in work – and will therefore lose less money each month than unemployed people on benefits.

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Minimum wage rise

Up-to-date figures on people earning minimum wage according to parliamentary constituency aren’t easy to come by. The last time they were published was in 2018.

However, if we assume the geography of the minimum wage has remained consistent since then (even if the exact figures are outdated), the map shows that while Labour seats in northern cities are set to benefit, Red Wall seats that turned blue in the last general election also have high proportions of people who will see their pay rise.

The minimum wage rise, combined with the taper rate cut, are two policies that will help those on low pay the most. However, those jobseeking, not working, or earning an average salary are set to be worse off next year due to the cost-of-living crisis.

[Hear also: Who were the winners from Rishi Sunak’s 2021 Budget?]

Ending the public sector pay freeze

Another big pledge from the Chancellor was to end the public sector pay freeze, though we will only know the extent of the ensuing pay rises next year.

Public sector workers have had their pay frozen and unfrozen by various Conservative governments since 2011-12, leading to what the Trades Union Congress describes as a “decade of lost pay”.

Some areas of public sector pay are decisions for the devolved nations – meaning that, for example, teachers and devolved civil servants in Wales were not affected by the latest freeze.

Looking at England, there isn’t an obvious political pattern. However, geographically, this policy matters less to London and the Home Counties, which have a higher proportion of workers in the private sector. If levelling up means focusing on “not London”, then arguably this policy fits that agenda (to the extent that it undoes a policy that was levelling down).

In general, this Budget was a good one for the Red (now blue) Wall – seats that tend to have a higher-than-average concentration of people on low pay will benefit from both the Universal Credit taper rate cut and the minimum wage rise.

Whether these policies will make up for a decade of austerity and the current cost-of-living crisis remains to be seen.

[See also: How generous was Rishi Sunak’s 2021 Budget and Spending Review really?]

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