Race Matters

Black & Asian Women Pay Highest Price for Austerity

Low income black and Asian women are paying the highest price for austerity according to new analysis by the Runnymede Trust and the Women’s Budget Group.

The evidence shows the impact of tax, benefit and public service changes at the intersection of income, gender and ethnicity for the first time.

By 2020 individuals in the poorest households will lose most from tax and benefit changes, but in every income group BME women will lose the greatest proportion of their individual income, according to the findings.

Low income black and Asian women will lose around twice as much money as low income white men as a result of tax and benefit changes.

The chart below breaks down the different impacts of tax and benefit changes on black, Asian and white men and women by their place in the income distribution.

The research was covered in The Guardian by Maya Goodfellow, who wrote:

“If you dig down into their findings you see lone mothers are hit the hardest – and in this group it is once again women of colour who stand to lose out the most financially. This magnifies a trend that existed before austerity gripped the UK: even before the 2008 financial crash the poverty rates among minority ethnic communities were significantly higher than for the white population.

One of the most significant reasons why black and Asian women are disproportionately affected is that they’re more likely to be employed in the public sector, working tirelessly as nurses in the NHS, or as teaching assistants and teachers in our state schools. As these frontline services are cut to the bone, so too are the bank accounts of the people that staff them.

A significant number of women of colour are also in low-paid jobs and insecure work - and they experience higher levels of unemployment than other groups. Since the 1980s unemployment rates among women of colour have remained consistently higher than for white women. But state support, which is essential to top up criminally low pay or help people survive while they look for work, has been slashed."

The report was also covered on BBC Radio 4’s Women’s Hour (segment starts at 21:20), Russia Today, and Public Sector Executive, Huffington Post, The Voice, the Morning Star, and  was picked up by Labour’s Dawn Butler and Sarah Champion.

Out of all household types, lone mothers are hardest hit by cuts to services and tax and benefits changes followed by lone fathers and single female pensioners. Among lone mothers, it is again black and minBME women that lose the most.

Commenting on the results, Dr Omar Khan, Director of the Runnymede Trust, said:

“The Chancellor has been clear that he wants an economy that works for everyone, yet this new analysis shows that his Autumn Statement does not begin to redress the disadvantages women in general and ethnic minority women in particular have faced as a result of austerity policies.

“We have previously shown that budget cuts have fallen hardest on BME families, but this new and comprehensive data goes further to demonstrate this. Black women suffer the cumulative effect of measures that disadvantage women and ethnic. minorities and as a result are suffering the worst outcomes. This must be rectified in future budgets as a matter of urgency.”

Dr Eva Neitzert, Director of the Women’s Budget Group, added:

“We’ve known for some time that the poorest households and women have shouldered the greatest burden of austerity measures. This research shows the compounding effect of income, gender and ethnicity. Women lose more than men, and black and Asian households lose more than white households. Taken together this sees the poorest Black and Asian women triply disadvantaged.

“If the government is serious about building an economy and country that works for everyone, they need to take urgent action to redress this triple disadvantage. The measures announced in the Autumn Statement are insignificant when set against the backdrop of benefit and public spending cuts that these groups have borne. For lone parents, the new measures equate to only 2% of the total cash cut and for single female pensioners the figure is 1%.  

“The government has repeatedly failed to carry out a meaningful analysis of the impact of their policies on different groups in society. This analysis both shows that it is technically possible and demonstrates its vital importance. It shows how the experience of austerity is determined by the combined interaction of ones income, ones gender and ones ethnicity.”

Last year Runnymede published research on the last Osborne budget, which was covered in The Guardian which found that minorities were twice as likely as white people to lose out. The article said: "The Conservative budget risks widening Britain’s racial divide by making millions of minority ethnic people poorer at a faster rate than their white counterparts, a study has found. Four million black and minority ethnic people could be left with less income, with one of the worst affected groups being British Muslims, according to the report by the Runnymede Trust.

“The report was compiled by Omar Khan, the director of the trust, a racial equality thinktank. He said minority ethnic Britons were around twice as likely to lose out as white Britons from George Osborne’s plans. Runnymede’s study has built in the fact that the national minimum wage will rise to £9 a hour in 2020. But changes to tax credits and other welfare payments will hit minority ethnic Britons harder than their white compatriots."

Runnymede will be working with the Women’s Budget Group in the run-up to the Chancellors’ spring 2017 budget with further analysis and recommendations for change.
  Share this post