Recession Austerity Recovery Our Lancashire – Present and Future Saulo Cwerner, Equality and Cohesion Manager County Equality and Cohesion Team

Austerity Impact Assessment The Great Recession of 2008 and recovery Global economic change The budget deficit and public sector savings Public sector reforms Tax and welfare reforms Long term demographic changes

Austerity Impact Assessment Literature review Analyses of various databases Interviews with key stakeholders Surveys of the VCFS and public sector 1 st stage report in March 2013

The Great Recession of 2008

The economic crisis Banking crisis and the credit crunch In 2011, In Lancashire 14 there were 470 more business deaths than births The business death rate in Lancashire 14 was 11.1%, higher than the UK average Real economic growth in Lancashire have lagged that of the UK, while its economy declined more than the UK’s in the recession

The economic crisis The housing bubble and house price falls In December 2012 house prices in Lancashire 12 revealed a yearly decline of 2.9% (while there was a 1.7% increase for England & Wales) Mortgage possession orders in Lancashire stood at 1365 for year to Q3 2012, a decrease of 15% Vacant dwelling rates for Burnley, Hyndburn and Pendle (7%) double that for England

Employment 3.7 million people have been made redundant during the Great Recession – 1 in 7 of all employees (just under 90,000 in Lancashire) Employment in Lancashire was down 2.5% in 2011 compared to 2008 levels Underemployed population in the UK estimated at 3.3 million, 42% increase since 2008 Under-employment rate in NW at 12%

Employment Unemployment increased in Lancashire 12 in the year to March 2012 (reversing the decrease of the previous year) Unemployment rate in Lancashire 12 was 7.4% Claimant data (January 2013) ranged from 1% in Ribble Valley to 3.4% in Burnley, while claimant count ranged from 172 (RV) to 1072 in Preston

Living standards Real wage stagnation began in 2003 Unlike in other recessions, inflation has remained high, outpacing wage growth Since 2010 real wages have experienced dramatic decline – in low income households, real income is expected to decrease by 15% by 2020 (at 2009 prices) 6 million households “financially vulnerable”

Living standards Number of children living in poverty estimated to increase by 400,000 in the course of this Parliament and by 800,000 by 2020 Source: Save the Children Parents who have cut back on food61% Parents who have skipped meals26% Children missing out on school trips19% Children without a warm coat in winter14%

DistrictNo. children in poverty% children in district Blackburn with Darwen Blackpool Burnley Chorley Fylde Hyndburn Lancaster Pendle Preston Ribble Valley7637 Rossendale South Ribble West Lancashire Wyre Lancashire Lancashire Source: End Child Poverty

Public sector austerity Budget deficit reduction (fiscal consolidation) is predicted to last until CSR meant an initial four-year 19% cut in departmental spending, including 7.1% annual fall in council budgets By 2018, total cuts to ‘unprotected’ department spending could amount to 31.5% OBR projection: 1.1 million job losses

Public sector austerity £18 billion in welfare cuts, plus £3.7 billion savings from uprating at 1% Universal Credit to replace various means- tested benefits from October 2013 Benefits cap, uprating below inflation, abolition of council tax benefit and reform of housing benefit, ‘bedroom tax’ Increases in the personal allowance

Impacts on equality People with disabilities: greater impacts of reductions in income and support will be felt by those in the 20% poorer households with a disabled person Changes to housing and council tax benefits could have a disproportionally negative impact DLA to PIP: up to 600,000 could lose benefit entirely (7,000 in Lancashire 12)

Impacts on equality £11 billion out of £14.9 billion of savings from taxes and spending cuts will come from women Women disproportionally affected by public sector job losses, benefit uprating, cuts in public services, declines in household incomes, rise in informal care, etc. Women aged over 50 hardest hit by recession, with 31% rise in unemployment since 2010

Impacts on integration Demise of community cohesion budgets Scrapping of the Migration Impacts Fund Estimated £2.8 billion reduction in voluntary sector grants by Between 2010 and 2012 the number of employees working in the voluntary sector decreased by 30,000, with a sharp increase in part-time and temporary work

Impacts on integration Superdiversity has arrived – Lancashire more diverse than ever More EAL children in Lancashire schools Language increase Polish108% Urdu50% Panjabi46% Bengali41% Gujarati15%

Impacts on integration Country Poland28.7%13.1% Slovakia4.1%1.6% India6.8%7.8% Romania3.1%3.8% Spain1.5%5% Italy2.1%4% Portugal1.6%2.9% Greece0.4%1% Total NINO Registrations - Source: DWP

Poverty and deprivation In ,000 people were fed by Trussell Trust food banks (over 230,000 in ) Over 250 TT food banks currently launched 500 expected to be open by 2016, feeding over half a million people Food banks in Blackpool, Blackburn, Chorley, Accrington, Burnley (2), Morecambe, Preston (2), Rossendale, Skelmersdale

Poverty and deprivation Suicide rates have risen in Europe since 2008 – Samaritans in 2008 warned about the potential impact of the recession on suicide Data from Samaritans (Ireland) shows that 1 in every 6 calls in 2012 was recession-related Citizens Advice Bureaus have seen a sharp increase in workload in recent years – benefits, redundancy, debt relief, fuel poverty, etc.

Poverty and deprivation Nutritional poverty: 900,000 fewer people managed 5-a-day in the two years to May 2012 Sales of organic products down 21% Sales of chilled ready meals up 25% in 2 years Retail food prices: increase by 25% since % of income spent on food in poorer households Increased pressure on new ‘social fund’

Emerging issues Disproportional impact of recession and austerity on certain protected groups Poverty and deprivation as determinants of various social issues – mental health, child well- being, housing problems, individual vulnerability and isolation, diminishing community resources Focus on growth and back to work schemes

Challenges ahead Squeezed budgets, increasing demand Encouraging innovation in services Focus on early intervention and prevention Developing new forms of partnership working Embedding knowledge and engagement Harnessing diversity Defending the public sector equality duty

Thank you! Mob