Monday, 18 October 2010

Its the young that are paying the price

The budget review is going to hit everyone pretty hard but it seems that there is one group being hit hardest, the young!

So far we have had confirmed that child benefit will be withdrawn from top earners, this is no bad thing in the sense that is moves towards a progressive tax/benefit system but it is just the first line of the policy targeting the young.
Secondly we have reforms EMA that could see many students loosing out. What ever your thoughts on EMA its not likely to go down well with those students loosing it.
Education slashes loom, if not in this review but in the near future. Again the true losers in this are the students, the NUT predicts the loss of specialist staff first, those that deal with behavioral and special needs.
The tally of cuts won't just affect those in education what about those just left education, those trying to buy their first house. Th Government reforms to the housing budget are going to make it, you guessed it, harder than before. 30,000 new 'affordable' homes were build in the south east and London last year and the latest prediction shows that in the next 5 years the government is unlikely to fund more than 250 new homes. The only hope is that the housing market will come down. While prediction are pointing the market that way the draw back is it normally a signal of a looming recession.
"The total number of 18 to 24-year-olds out of work for two years or more rose to 72,000 in the three months to June, up 11pc on the previous quarter, according to the Office for National Statistics (ONS)." -Telegraph
Youth unemployment as a result of the recession is clear to see and t it will only get worse if we going into a double-dip recession. I know that many of my peers find it hard to get work, I've found my self struggling to get work as a direct result of budget cuts to the police.
Majourty of students expenditor is on a small luxary items (video games) or cloths and a lot on books as well. The VAT increase will proportionally hit the young harder, especially with talk of it being applied to books and clothes now.
Then there is the big one, the hit that will take money directly out of the pockets of students and laden them with debt, Tuition fees. It’s looking like tuitions fees will be raised from £3,225 to £7000, over doubling! This means over double the debt, it seems the deficit is being shifted from the government balance to the accounts of students.

Its those that did not cause the credit crunch or rack up the debt that are now having to pay for it and the Conservative party will have to be careful, the young are the voters of the future, something Labour are exploiting given the circumstances stated above. Perhaps also Mr. Cameron should also be wary of students, student unions can be quite militant and in France we've seen their student unions joining mass strikes, the often fiery youth could come back to give the Prime Minister a nasty burn.


  1. This is a slightly biased argument coming from a young person. You forget that there are millions of adults losing jobs and facing tough times. I also don't see how VAT will hit young people harder, because the things they tend to buy are a lot cheaper. For example, moving VAT from 17.5% to 20% would mean that a £30 video game would go from being £30 to £30.75. However, if you're buying a £10,000 car, thats already an extra £250 and £10,000 is by no means an expensive car. This the sort of level that would actually put people off buying them, not a few pence on a game or pair of trainers.

    Plus, EMA shouldn't necessarily be scrapped, but should be more stringently means tested. Though the cost of doing so would outweigh the cost of just paying it, so it is probably in the best interest of the economy to cut it off entirely and perhaps raise other benefits for poorer families. The problem comes when you cut off child benefit to those that actually need it.

  2. It is bias and to say it is the young that are hit the 'hardest' can not be proven. As a direct short term result of the spending cuts those loosing their job directly or indirectly will be hit very very hard, how ever i think in the long run it is the youth that will be adversely effected the most.
    VAT rise hits young people harder because as a proportion of their income, young people spend more on VAT tax able products. A young person working saturdays for £200 a month is likely to spend most of that £200, likely on: clothes, booze, games etc. even if VAT increase only means they loose a 5 or so more a month that is more as a percentage of income than someone in full time employment, who may spend £400 as month but earn £1000 a month. Those that have been saving up for a car will pay out more how ever this is a long term purchase not every day living, with regard to just every day purchases VAT is regressive and students fall into that category (we are a low decile group).
    I disagree with EMA, it should be means tested. But you have to wonder that is it actually better in the long run that we do pay more to chance the system if then more people stay in collage and this leads to supply side increases (through labour) in the economy.

  3. Thanks for commenting and reading my post. I like to hear you opinions