What does today’s autumn statement mean for Cornwall?
First, it shows the failure of the Coalition Government’s strategy of cutting further faster – the same strategy which is being pursued by Cornwall Council and that has resulted in many local job and service cuts. The numbers now suggest that at best the deficit may be halved rather than paid down by 2015, but today’s statement made no real adjustments to provide an effective boost to growth.
Few of the new measures offer hope to those struggling with the rising cost of living, housing shortages, unemployment and transport gaps in Cornwall.
1. Cost of living:
- cancellation of the 3p fuel duty increase from January 2012 will help motorists, but reversing the January 2011 2.5% VAT rise would trim the cost of a much wider range of basic items and services.
- £50 a year off average SW water bills will be welcomed, but this year over-60s households across the UK have already faced a £50 cut from the winter fuel allowance.
- capping public sector pay increases at 1% in 2013-15 will mean that the one in three people who work for the public sector in Cornwall will have seen their pay rise by a maximum of 2% since 2011 by 2015, while facing rising contributions, increased cost of living, and pension cuts.
- pensions, disability and unemployment benefits will rise in line with inflation (the Consumer Price Index) from April 2012, but the decision to freeze tax credits will hit the families of Cornwall’s lowest paid and minimum wage workers, and families relying on child tax credit.
- the 1% cap on rail fares will help those for whom commuting by train is an option – this can already be cheaper than bus fares, and bus services are likely to be reduced in 2012 as a result of Cornwall Council cuts to subsidies and concessionary fares.
2. Affordable housing:
- there are 21,578 households in Cornwall in registered housing need.
- following the recent Government announcement restoring 10% of the previously planned spending on social housing, the Homes and Communities Agency on 22 November 2011 announced it will be funding the completion of 389 affordable homes in Cornwall by 2015.
- current house prices mean right to buy purchases had ceased in practice, the 50% discount announced today will still mean mortgage costs are likely to be more expensive than social housing rents and unaffordable for many; but any sales with a 50% discount would bring in a receipt which would be smaller than the current cost of building a new social home, so not prevent the loss of social housing stock.
- the main source of new social and affordable housing is likely to be through local planning – eg in the former Carrick area the requirement of 35% affordable homes (50% on land sold by public sector like the former Richard Lander School site in Truro).
3. Jobs, earnings and infrastructure
- earnings in Cornwall continue to lag behind the UK at about 80% of the UK average.
- over 9000 people are unemployed in Cornwall – that is 2.7%, compared to 3.8% across the UK – there are also fewer unfilled vacancies in Cornwall than the UK average.
- none of the 500+ transport infrastructure investments announced were in Cornwall, and the focus for next generation broadband appeared to be the largest cities while seeking 90% UK coverage; for Cornwall to prosper we need next generation broadband with rural coverage sooner rather than later. And does the announcement mean the Scillies ferry replacement by 2014, Falmouth docks improvement, Treluswell park and rail ride etc are not amongst the 500+ chosen projects despite the fact that they would bring jobs or help reduce traffic congestion?
4. Young people
- youth unemployment is highest, 6.9% in Cornwall compared to 8% across the UK. The new support scheme won’t start until next summer.
- cuts to the EMA and increased students fees mean young adults face less educational support as well as substantial challenges finding a job and affording a home – and from January 2012, tenants below the age of 35 will not be eligible for housing benefit for self-contained accommodation.
