Austerity and another Lourdes

Marlyn Glen

18 July 2012

Scotland became less unequal last year. 

The gap in incomes between the rich and the rest, fell in 2010-11 , reversing a trend of growing inequality in recent years. 

The gap now stands where it stood in the halcyon days of Labour’s General Election victory in 1997. 

The gap in incomes, as measured by the Gini coefficient was 30 per cent

(A Gini coefficient of 0 per cent would mean equality of incomes, 100 per cent would mean complete inequality of incomes. 30 per cent is still far behind Scandinavian countries such as Norway and Sweden with much lower income gaps.) 

The UK  gap narrowed only because , while the recession has lowered all incomes , it has hit the very wealthy the most, percentage-wise.

But austerity amongst the rich  must be many shades lighter than it is amongst the remainder, and at the centre of the UK of government austerity policies , more cuts, this time of a much larger scale,  are looming.

The Glasgow-based Centre for Public Policy for Regions (CPPR) estimate that around three quarters of cuts in spending on services in Scotland have still to take place  - just under £3billlion by 2016-17, with the deepest coming after the proposed Referendum.

 Inevitably, the health of the most vulnerable will suffer.

One health board’s evidence submitted to the Scottish Parliament’s Finance Committee examining the effects of the Welfare Reform Act concluded that “  illnesses in adults and children requiring inpatient care are likely to increase as a consequence of the health impacts of the Welfare Reform Act.

“These include mental, cardiovascular and respiratory illnesses resulting from low income, income inequalities, housing difficulties and fuel poverty and specific additional obesity-related illnesses such as diabetes, arthritis and cancer arising from poorer nutrition.” (NHS Highland )

A recent review “General Practice at the Deep End” gathered information from GPs working in the 100 most deprived areas in Scotland on the consequences of austerity for their patients’ well-being.

Patients ranged from those in work feeling the pressure of cuts in public spending, seeking additional work to make ends meet, and displaying “presenteeism” ( turning up for work when their symptoms indicated that they shouldn’t have) to those with recognised long-term health  problems but classified as “fit for work” and their benefits cut.

While the GPs’ priorities were patients’ health, the patients’ priorities were lack of money for food and heating.

Observations included,

“ Perhaps most striking is the growing number of individuals and families experiencing fuel poverty – the combination of increased costs and falling benefits resulting in a choice between heating and eating.

“Practices reported cases of an elderly patient going to a friend’s house in order to wash; families relying on relatives to pay for food and cigarettes (unable to stop smoking due to stress);….

“In my surgery I am hearing from patients who for 2–3 days a week cannot afford to heat their houses (many use metered cards which are more expensive than direct debit payments). “

Assessments carried out under the Work Capability Assessment had a dramatic effect on the health of those whose benefits were cut, with mis-matches between people’s clinical condition and the assessments finding that they were “fit for work”

Corunna House , the Glasgow Disability Benefits Centre  where the Work Capability Assessments are carried out, was known locally as “Lourdes” because “all of the sick emerge from it cured.”

GPs, through BMA Scotland , have called for the Work Capability Assessment to be scrapped, saying that the system needs to be replaced by “a more vigorous and safe process which takes into account the needs of long term sick and disabled patients.”

The biggest single group facing the fiercest brunt of the cuts,  are women, with a triple whammy - cuts in jobs in the public sector where women are the majority workforce, reductions in the public services used by women, and women being left to ”plug the gaps” with their own personal efforts when council provision falls because of cuts in services for dependents, all of which is counter=productive to maintaining personal health.

So there is wealth of evidence and experience to indicate how the next wave of austerity cuts will impact upon health.

However, what of those on the other side of the story of the cuts, whose  actions lie amongst the root causes of the prevailing austerity?

Before The Crash, there was a high-octane macho culture in casino banking whose banality of vision was the size of the bonus earned, even when the reward was for failure, and the strategy was reckless. These ultra-competitive men, were the “wealth creators”, the magicians of the market, proclaimed to possess “special skills” that were not subject to dispute.

The “Guardian” columnist George  Monbiot refers to the work of Nobel Economics Prize winner,  Daniel Kahneman which starkly challenges the illusion of omnipotent thinking  at the top in the financial sector.

He studied the performances of wealth advisers over an 8-year period to determine whether or not “there were persistent differences in skill among them and whether the same advisers consistently achieved better returns for their clients year after year.”

He found a correlation of zero, saying

“the results resembled what you would expect from a dice-rolling contest, not a game of skill. .

“The subjective experience of traders is that they are making sensible educated guesses in a situation of great uncertainty.

“In highly efficient markets, however, educated guesses are no more accurate than blind guesses.”

There was no correlation, no connection, no consistency.

In short, success depended heavily on luck, not on evidence, never the basis for a secure future, and so it has proved , to the detriment of us all.

There are no shared sacrifices in this austerity , no choices for the wealthy between having to eat or heat.

Instead it’s tax cuts for them rather than benefit cuts.

And it isn’t working.

In a recession, cuts in spending do not just magnify falling demand and reduce business investment.

They also diminish people’s health and well-being.


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