Tag: Tax credit cuts

The government has failed to protect the human rights of children

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The UK has plummeted from 11th position to 156th in global ranking for meeting its children’s rights obligations in the space of just a year. The UK now ranks among the bottom 10 global performers in the arena of improving the human rights of the child, after it achieved the lowest possible score across all six available indicators in the domain of Child Rights Environment (CRE), according to the KidsRights Index 2017.

The Index gathers data from Unicef and the United Nations Committee on the Rights of the Child (UNCRC) to identify global trends in the arena of children’s rights protection. It comprises a ranking for all UN member states that have ratified the UN Convention on the Rights of the Child, a total of 165 countries. 

The report says that a nation’s prosperity does not always guarantee children’s rights. Interestingly, economically better performing countries are not necessarily doing a better job when it comes to safeguarding the rights of children.

This year’s overall worst performing countries are the United Kingdom, Papua New Guinea, New Zealand, Guinea-Bissau, Equatorial Guinea, Chad, Vanuatu, Sierra Leone, Afghanistan and Central African Republic.

Very serious concerns have been raised about structural discrimination in the UK. Muslim children are facing increased discrimination following recent anti-terrorism measures, and a rise in discrimination against gypsy and refugee children in recent years.

The KidsRights Index is comprised of 5 domains: 

  1. Right to Life
  2. Right to Health
  3. Right to Education
  4. Right to Protection
  5. Enabling Environment for Child Rights

Marc Dullaert, founder and chairman of the KidsRights Foundation, has urged the UK government to treat non-discrimination as a policy priority, and to speed up the process of aligning its child protection laws with the Convention on the Rights of the Child at both the national and devolved levels, as well as in all crown dependencies.

He said: “Discrimination against vulnerable groups of children and youths is severely hampering opportunities for future generations to reach their full potential.” 

“Following the general election, the new government should demonstrate to the world that it will not allow the retreat from the EU to adversely affect the rights and opportunities of its children.” 

In light of the findings, Lord Philip Hunt, shadow deputy leader of the House of Lords and shadow health spokesperson, accused the Government of “inactivity” and “inadequate service provision”, urging it to do more to protect the rights of the child.

He said: “This report exposes the inactivity of the current UK government and inadequate service provision in this most important area of policy making; rights of the child.” 

“The UK is the sixth largest economy globally and therefore has the resources at its disposal to ensure that our children are adequately protected and cared for across multiple disciplines. Our children are our future and the barometer of our approach to social justice and the state of our society.”

Although many states have adopted new children’s rights policies in recent years, the Index reveals that implementation is often not evident, and many new policies fail to fully comply with the principles and provisions of the Convention on the Rights of the Child.

The Index rates and ranks the extent to which a country has implemented the general principles of the Convention on the Rights of the Child while taking into account the basic infrastructure for making and implementing children’s rights policies. Portugal is this year’s global top ranking nation, with France, Norway, Sweden, Finland and Spain also ranking in the top ten.

The Index methodology means that extremely poor performances in one domain cannot be compensated by higher scores in other domains, as all of areas children’s rights are deemed to be equally important.

The report concluded that many industrialised nations, and especially the UK, are falling far short of allocating sufficient budgets towards creating a stable environment for children’s rights, by neglecting their leadership responsibilities and failing to invest in the rights of children to the best of their abilities.

Human rights and the impact of childhood poverty 

Earlier this month, another damning report published by the Royal College of Paediatrics, Child Health (RCPCH) and Child Poverty Action Group (CPAG) revealed that more than two-thirds of paediatricians believe poverty and low income contribute “very much” to the ill health of children that they work with. 

The report – Poverty and child health: views from the frontline  is based on a survey of more than 250 paediatricians across the country, whose comments provide an insight into the grave reality of life for the millions of UK children living in poverty.

Latest figures show that more than one in four (nearly 4 million) children in the UK live in poverty – with projections suggesting this could rise to 5 million by the end of the decade.

The report explores number of areas including food insecurity, poor housing and worry, stress and stigma – and the effect of these issues on the health of children.  

The report reveals that:

  • more than two-thirds of paediatricians surveyed said poverty and low income contribute ‘very much’ to the ill health of children they work with
  • housing problems or homelessness were a concern for two-thirds of respondents.
  • more than 60% said food insecurity contributed to the ill health amongst children they treat 3
  • 40% had difficulty discharging a child in the last 6 months because of concerns about housing or food insecurity
  • more than 50% of respondents said that financial stress and worry contribute ‘very much’ to the ill health of children they work with

Alison Garnham, Chief Executive of the Child Poverty Action Group, said:

“Day in, day out doctors see the damage rising poverty does to children’s health. Their disquiet comes through in the survey findings and should sound alarms for the next government. Low family incomes, inadequate housing and cuts to support services are jeopardising the health of our most vulnerable children.

“We can and must do better to protect the well-being of future generations. reinstating the UK’s poverty-reduction targets would be an obvious place to start.” 

Professor Russell Viner, Officer for Health Promotion at the Royal College of Paediatrics and Child Health, said:

“Poverty has a devastating effect on child health and this report makes disturbing reading. The health impact on children living in poverty is significant – whether that’s increased likelihood of respiratory problems, mental ill-health or obesity – than children living in more affluent areas.

“Worryingly, almost half of those surveyed feel the problem is getting worse, with the combination of increasing poverty, housing problems and cuts to services meaning more families are struggling.”  

The RCPCH and CPAG are calling on whoever forms the next Government to tackle poverty urgently through: 

  • the restoration of binding national targets to reduce child poverty, backed by a national child poverty strategy
  • the adoption of a ‘child health in all policies’ approach to decision making and policy development, with Her Majesty’s Treasury disclosing information about the impact of the Chancellor’s annual budget statement on child poverty and inequality
  • the reversal of public health cuts to ensure universal early years services, including health visiting and school nursing, are prioritised and supported financially, with additional targeted help for children and families experiencing poverty
  • the reversal of cuts to universal credit which will leave the majority of families claiming this benefit worse off.

As one survey respondent said: “We cannot expect to have a healthy future for the UK if we leave children behind. Poverty makes children sick.”

There were 3.9 million children living in “relative poverty” in 2014-15, up from 3.7 million a year earlier, according to figures from the Department for Work and Pensions (DWP).

The report follows the release of  figures from the DWP which revealed one in four (nearly four million) children in the UK live in poverty – with projections suggesting this could rise to five million by the end of the decade.

It’s not as if the government have been unaware of the consequences of their policies and the implications of a consistent failure to uphold the UK’s human rights obligations towards children. In 2014, the Children’s Commissioner warned that the increasing inequality resulting from the austerity cuts, and in particular, the welfare reforms, means that Britain is now in breach of the United Nations Convention on the Rights of the Child, which is supposed to protect children from the adverse effects of government economic measures.

In 2015, the Children’s Commissioner criticised the Conservative’s tax credit cuts and called for measures to reduce the impact that the changes will have on the poorest children. Anne Longfield, who took up her role on 1 March 2015, called on the government to exempt 800,000 children under five from tax credit cuts and to offer additional support to families with a child under five-years-old.

The role of Children’s Commissioner was established under Labour’s Children Act in 2004 to be the independent voice of children and young people and to champion their interests and bring their concerns and views to the national arena. The Commissioner’s work must take regard of children’s rights (the United Nations Convention on the Rights of the Child) and seek to improve the wellbeing of children and young people.

However, the government rejected the findings of what they deemed the “partial, selective and misleading” Children’s Commissioner report. The Commissioner wrote to the Chancellor to call for children in the poorest families aged under five to be protected from the cuts.

However, George Osborne shamefully remained brazenly unrepentant.

A damning joint report written by the four United Kingdom Children’s Commissioners for the UN Committee on the Rights of the Child’s examination of the UK’s Fifth Periodic Report under the UN Convention on the Rights of the Child (UNCRC), dated 14 August 2015, says, in its overall assessment of the UK’s record: 

“The Children’s Commissioners are concerned that the UK State Party’s response to the global economic downturn, including the imposition of austerity measures and changes to the welfare system, has resulted in a failure to protect the most disadvantaged children and those in especially vulnerable groups from child poverty, preventing the realisation of their rights under Articles 26 and 27 UNCRC. 

The best interests of children were not central to the development of these policies and children’s views were not sought. 

Reductions to household income for poorer children as a result of tax, transfer and social security benefit changes have led to food and fuel poverty, and the sharply increased use of crisis food bank provision by families. In some parts of the UK there is insufficient affordable decent housing which has led to poorer children living in inadequate housing and in temporary accommodation.

Austerity measures have reduced provision of a range of services that protect and fulfil children’s rights including health and child and adolescent mental health services; education; early years; preventive and early intervention services; and youth services. 

The Commissioners are also seriously concerned at the impact of systematic reductions to legal advice, assistance and representation for children and their parents/carers in important areas such as prison law; immigration; private family law; and education. This means that children are denied access to remedies where their rights have been breached.

The Commissioners are also concerned at the future of the human rights settlement in the United Kingdom due to the UK Government’s intention to repeal the Human Rights Act 1998 (HRA) which incorporates the European Convention on Human Rights (ECHR) into domestic law; replace it with a British Bill of Rights (the contents of which are yet to be announced), and ‘break the formal link between British courts and the European Court of Human Rights’.

The HRA has been vital in promoting and protecting the rights of children in the United Kingdom and the European Court of Human Rights has had an important role in developing the protection offered to children by the ECHR.The Commissioners are concerned that any amendment or replacement of the HRA is likely to be regressive.”

In another regressive and punitive policy move by the government, from April 6 2017, child tax credits and universal credit across the UK will be restricted to the first two children in a family. This measure will affect all households with two or more children that have an additional child after this date.

Analysis by consultancy Policy in Practice revealed a low-income family whose third or additional child is born before midnight on the day before the policy came into force would qualify for up to £50,000 in tax credit support over 18 years whereas a similar family whose third child is born on April 6 will miss out.

The government says it wants to save money and make the tax credit system “fairer”. It intends the two-child restriction to “influence the behaviour” of less well-off families by making them “think twice” about having a third child. But it also accepts there is no evidence to suggest this will happen.

This is an extremely regressive eugenic policy, with its emphasis being on social class. Eugenics was discredited following its terrible escalation and consequences in Nazi Germany.  

The two children only policy also a reflects a politically motivated form of crude behaviourism –  behaviour modification through the use of financial punishments. It’s probably true that all authoritarians and tyrants are behaviourists of sorts.

Critics say that at current birth rates, 100,000 third or subsequent children will not qualify for tax credit support over the next 12 months, inflating child poverty figures by at least 10% by 2020.

Social Darwinism is linked closely with eugenic ideas – a view that society and economics will naturally “check” the problem of dysgenics if no welfare policies are in place. 

The Conservative government has steadily dismantled the welfare state over the past seven years, so that now, there is no longer adequate support provision for people both in work and out of work, to meet their basic living needs. 

The current retrogressive, draconian approach to poverty needs to radically change if we are to be a nation that respects and upholds the human rights of all its citizens.

 


 

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Conservative social security policy is not founded on rational analysis and evidence

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Recently I wrote an article about the new benefit cap which parodied Conservative ideology, traditional class prejudices and subsequent justification narratives for their welfare “reforms”, likening the latter to nineteenth century character divination – phrenology in particular. Sometimes, it’s easier to highlight the ridiculous by simply ridiculing it.

A lot of my work is themed around serious and rational critique of Conservative shortcomings when it comes to the whole process of policy-making and research, from the theories” that inform the process, to the ideologically-driven impacts and narrow neoliberal aims and outcomes, which have led to some catastrophic social consequences. This is because austerity has been aimed exclusively at those citizens who had the very least to start off with. Sick and disabled people have been systematically and disproportionately targeted for cuts to their support.

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I’ve written previously about the government’s increasing use of secondary legislation to push through controversial and highly partisan policies without an adequate degree of parliamentary scrutiny and debate. The public are entirely excluded from this process. This is one way that the Conservatives have been getting away with highly prejudiced, ideologically-driven policies that have not been analysed in terms of safeguarding citizens, impact, compatibility with our international human rights obligations and are neither adequately justified nor evidenced. 

The Strathclyde review and Conservative authoritarianism

Secondary legislation is unamendable and is allocated 90 minutes debate in the Commons at best, by the Conservatives. Secondary legislation in the form of Statutory Instruments was only ever intended for non-controversial and small tidying up legislative measures. A Tory aide admitted that the government are trying to get as much unpopular legislation in through the secondary route as possible. But this has been very evident anyway. The government is intent on dismantling any inconvenient piece of the constitution.

In a democracy there is always a responsibility and need to ensure additional checks and balances against incumbent governments and for extending opportunities to review and improve the quality of legislation. There is always a need to broaden the political participation and democratic inclusion of particular groups in society; to explore ways by which under-represented groups may be identified and included in political decision-making processes.

Statutory Instruments are the principal form in which delegated legislation is made, and are intended to be used for simple, non-controversial measures, in contrast to more complex items of primary legislation (known as Bills.) The opposition has frequently complained that the government uses Statutory Instruments to pass complex and controversial legislation which should have been subject to full Parliamentary scrutiny. Universal credit, the legal aid and tax credit cuts are clear examples of the misuse of secondary legislation, each with far-reaching and detrimental socioeconomic consequences for many people.

The steep rise in the use of Statutory Instruments since 2010 is an indication of how the Conservatives are politically managing pre-legislative scrutiny, stifling healthy debate, curtailing opposition, and side-stepping essential democratic transparency and accountability. It’s also an indication that much Conservative legislation is ideologically-driven rather than needs-driven: the use of secondary legislation as a means of avoiding scrutiny demonstrates that the government are aware that much of their planned programme won’t stand up to close Parliamentary examination and rational debate.

Lord Strathclyde was asked in October last year by David Cameron to undertake a “rapid review” that considered how to secure the decisive role of the House of Commons in relation to its primacy on financial matters and secondary legislation. Of course, Strathclyde’s report was published by the Government on the 17 December, 2015, which marked the final sitting of Parliament before Christmas. Nonetheless the media did actually cover the contents of the report and some of the implications of the recommendations made.

Strathclyde concluded in his report that the House of Lords should be permitted to ask the Commons to “think again” when a disagreement on proposed legislation exists, but should not be allowed to veto. MPs would ultimately make a decision on whether a measure is passed into law. The review focuses in particular on the relationship between the Commons and the Lords, in relation to the former’s primacy on financial matters and secondary legislation.

The key problem is that Statutory Instruments (SI) are being over-used and are under-scrutinised in the Commons. SIs have become a major form of law-making activity in the UK. In 2015, the UK Parliament passed 34 Acts, whilst 1,999 Statutory Instruments were made. (In fact, 2015 has been a relatively light year for SIs: in 2013 and 2014, 3,292 and 3,486 SIs were made.)

The government ensure they have a majority on any SI committee and MPs are chosen by Whips. The Hansard Society estimate that SIs currently account for as much as 80 per cent of the Government legislation that impacts citizens. However, they are given substantially less Parliamentary time than Bills, enabling government to push through their ideologically designed legislative programme with very little scrutiny, exacerbating a lack of democratic transparency and accountability of the Executive (the government). 

Further presented justification for grotesquely unfair policies from the Conservatives is based on a claim that “we have a clear mandate to do this.” The concept of a government having a legitimate mandate to govern via the fair winning of a democratic election is a central component of representative democracy. However, new governments who attempt to introduce policies that they did not make explicit and public during an election campaign are said to not have a legitimate mandate to implement such policies. 

In order to keep his promises on further future tax cuts for higher earners, George Osborne made even more cuts to public services, public sector pay and the social security safety net that are so deep they will severely damage both the economy and potentially, the fabric of our society. The Institute for Fiscal Studies (IFS) have criticised Osborne’s proposed tax credit cuts, because it is “at odds” with wider Conservative stated aims to “support hardworking families”.

Research conducted by the IFS calculated that only around quarter of money take from families through tax credit cuts would be returned by the new National “Living Wage”.Tax credits are payments made by the government to people on lower incomes, most of whom are in work. 

Cameron effectively ruled out cutting the benefit before the election, telling a voter’s Question Time that he “rejected” proposals to cut tax credits and did not want to do so. The cuts are part of £12bn cuts to the social security budget that the government is to make – the details of which the Conservatives refused to announce before the election.

However, in an unprecedented move, the Conservatives have threatened a constitutional “showdown”, and have refused to engage in dialogue with peers that want kill off the proposed Tory cuts. The government warned the House of Lords it would trigger a full-scale constitutional crisis by pressing ahead with their plans. 

The review by Lord Strathclyde, commissioned by a rancorous and retaliatory Cameron followed the delay and subsequently effective defeat of government tax credit legislation in the House of Lords, and it has, of course, recommended curtailing the powers of Upper House. 

Strathclyde proposed that the House of Commons is given the final say over secondary legislation (in particular, Statutory Instruments), which are, as previously stated, frequently being used for political manoeuvring to edit the details of Acts, and ensure rules, regulations and even changes to legal definitions are made by ministerial order, rather than by the rather more open and democratic process of primary legislation: it’s being used as a way of bypassing Parliamentary scrutiny. 

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The view from the Social Security Advisory Committee

More recently, the Chair of the Social Security Advisory Committee (SSAC) has also concluded that “pressure from the Treasury” resulted in welfare changes being pushed through parliament “without meaningful analysis of impact or interactions with other parts of the benefit system.” He also raises the same issues that I previously have regarding the government’s increased use of secondary legislation.

In a very damning report on how the government develops welfare policies, SSAC Chair Paul Gray says top-down pressure from the former chancellor, Osborne, to meet Budget deadlines meant legislation was being rushed without proper analysis or scrutiny.

In a foreword to the report, Gray writes: “On the basis that primary legislation was to be debated in some detail in Parliament, the Government was not required to bring the majority of these provisions to SSAC.

Consequently, the amount of secondary legislation presented to us in the first few months of the reporting year was lighter than usual.

By contrast from September onwards a number of sets of regulations were presented to us for scrutiny – most with their origins in the Chancellor of the Exchequer’s Budget proposals for reducing benefit expenditure.”

He goes on to say: “The Committee has observed that legislation required to deliver policies announced by the Chancellor during his Budget or autumn statements is often developed at pace to meet challenging deadlines set by HM Treasury.

This has regularly resulted in secondary legislation being presented to us without meaningful analysis of impact or interactions with other parts of the benefit system.

The absence of evidence underpinning some of the Government’s policy choices has been a significant concern to us over the past year, and we hope that the Government will adjust this aspect of its approach to policy-making in the coming year.”

He added: “The committee has noted in the past the absence of analytical material on the cumulative impact of welfare reforms.”

Gray also draws attention in particular to tax credit changes proposed in the summer budget highlighting “the lack of available evidence to support the policy changes being presented to us”.

Gray concludes: “There can be no question that this committee is hampered in its role of scrutinising proposed changes in cases where the supporting explanatory material and evidence is scant.”

It’s a point I have made myself many many times. However, unlike the government, I do tend to include evidence and analysis in my ongoing critique of Conservative policies.

The ideological drive to dismantle the welfare state

Despite the relentless Conservative attacks on social security since 2010, (which is funded by the citizens that it supports when they experience hardships), Theresa May will not rule out delivering yet more brutal welfare cuts if the economy suffers a downturn because of Britain exiting the EU. The prime minister refused to offer any guarantees that she will spare struggling families if Whitehall savings are needed in the coming months. 

May has made it clear there will be no end to Tory austerity, she said: “What I’m clear about is we’re going to continue as we have done in Government over the last six years – ensuring that we’re a country that can live within our means.”

I’m just wondering how awarding millionaires £107,000 each per year in the form of a “tax break” in 2012 at the same time as introducing the radical cuts to social security can possibly be construed as an act that ensures “a country that can live within our means.” It seems to me that the Conservatives want to completely dismantle our welfare state, along with all the other gains of our social settlement (social housing, the NHS, legal aid and public services) but fear public opposition.

So rather than be honest about their intention, the Conservatives have chosen to stigmatise people needing welfare support to disperse public sympathy, to create scapegoats and generate moral panic. The public gradually come to accept the anti-welfare narrative as “fact”, despite the lack of evidence and analysis. Moral and rational boundaries will be pushed, prejudice will advance stage by stage. The incremental cuts will continue until there is nothing left to cut.

Earlier this year, the chancellor was forced to try and defend his decision to use the cuts in disability benefits to fund tax breaks for the wealthy. Controversially, the cuts benefitted the top 7% of earners. The Chancellor raised the threshold at which people start paying 40p tax, in a move that saw many wealthier people pulled out of the higher rate of income tax. 

Osborne callously claimed that the Conservative government was “increasing spending on disabled people”, he said: “Controlling welfare bills is part of what you need to do if you’re a secure country confronting the problems in the world.” It was an utterly ludicrous comment.

The cuts to ESA and PIP show an intended substantial reduction on government spending to essential support for disabled people.

In a wealth transfer from the poorest to the very rich, we have witnessed the profits of public services being privatised, but the losses have been socialised – entailing a process of economic enclosure for the wealthiest. The burden of losses have been placed on the poorest social groups and some of our most vulnerable citizens – largely those people who are ill, disabled and elderly. The Conservative’s justification narratives regarding their draconian policies, targeting the poorest social groups, have led to media scapegoating, social outgrouping, persistent political denial of the aims and consequences of policies and reflect a wider process of political disenfranchisement of the poorest citizens, especially sick and disabled people.

That the cuts are ideologically driven, and have nothing whatsoever to do with economic necessity, was demonstrated only too well by the National Audit Office (NAO) report earlier this year. The NAO scrutinises public spending for Parliament and is independent of government. The report indicates how public services are being appropriated for purely private benefit.

The audit report in January concluded that the Department for Work and Pension’s spending on contracts for disability benefit assessments is expected to double in 2016/17 compared with 2014/15. The government’s flagship welfare-cut scheme will be actually spending more money on the assessments conducted by private companies than it is saving in reductions to the benefits bill.

From the report:

£1.6 billion
Estimated cost of contracted-out health and disability assessments over three years, 2015 to 2018

£0.4 billion
Latest expected reduction in annual disability benefit spending.

This summary reflects staggering economic incompetence, a flagrant, politically motivated waste of tax payer’s money and even worse, the higher spending has not created a competent or ethical assessment framework, nor is it improving the lives of sick and disabled people. Some people are dying after being wrongly assessed as “fit for work”and having their lifeline benefits brutally withdrawn. Private companies like Maximus are paid millions from our welfare budget, yet they are certainly not “helping the government” to serve even the most basic needs of sick and disabled people.

However, private companies serve the private needs of a “small state” doctrinaire neoliberal government, and making lots of private profit whilst it does so. The Conservatives are systematically dismantling the UK’s social security system, not because there is an empirically justifiable reason or economic need to do so, but because the government has purely ideological, anticollectivist, antidemocratic, profoundly uncivilising prescriptions and longstanding class-based prejudices.

When the Conservatives say they are going to “tackle poverty”, what they mean is that they intend to rigidly police the poor, rather than alleviate poverty. Meanwhile, the new right’s economic enclosure act – austerity – will continue to impoverish many more. The state will respond to each crisis with more authoritarianism and psychopolitical techniques of persuasion, amplified via the media. And the wealthy and powerful will become wealthier and more powerful.

Unless we collectively fight back.

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Related

The Conservative approach to social research – that way madness lies

Cases of malnutrition continue to soar in the UK

Two key studies show that punitive benefit sanctions don’t ‘incentivise’ people to work, as claimed by the government

Benefit Sanctions Can’t Possibly ‘Incentivise’ People To Work – And Here’s Why

 


I don’t make any money from my work. But you can contribute by making a donation and help me continue to research and write informative, insightful and independent articles, and to provide support to others. The smallest amount is much appreciated – thank you.

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Government signal move to curb the powers of the House of Lords after tax credit defeat

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Following the government’s embarrassing defeat on the proposed tax credit cuts in the House of Lords yesterday, the Conservatives are planning to curtail the powers of the Peers. Both the chancellor and David Cameron said the defeats have raised a “constitutional issue” which they were determined to tackle.

A Downing Street spokesman has said: “The prime minister is determined we will address this constitutional issue. A convention exists and it has been broken. He has asked for a rapid review to see how it can be put back in place.”

Yet even Lord Lawson, the former Conservative chancellor, voiced that he was struggling to support the tax credit cuts and he called on Osborne to do more to help low-income earners. He said: “Here a great deal of the harm is at the lowest end, and that is what needs to be looked at again. That is what concerns me.”

He added: “It is not just listening which is required [from the government] but change.”

The Clerk of the Parliaments has confirmed that Commons financial privilege does not extend to statutory instruments. Many Peers pointed out throughout the debate that welfare policy isn’t “budgetary.”

But on Tuesday, Downing Street will outline plans for a “rapid review”, which will examine ways to secure the “supremacy of the House of Commons on financial matters and secondary legislations, after the prime minister accused peers of “breaking a constitutional convention.” A furious Cameron is planning to set limits on the power of the House of Lords after George Osborne suffered a major and humiliating blow yesterday, when Peers voted to delay tax credit cuts in order to protect those who would lose out.

The Upper House voted in favour of a motion by the former Labour minister Lady Hollis to halt the cuts until the government has responded to new evidence regarding the likely negative impact of the cuts on protected social groups, and produces a scheme to compensate low-paid workers for three years. 

Baroness Lister pointed out that no impact assesment was carried out regarding the cuts, and said “the Bill is an example of none evidence-based policy making. She said “It betrays lack of understanding of policy and people’s lives,” and added “getting an impact assessment from the government is like pulling teeth”.

Lord Campbell observed during the debate that because of the Conservative’s pre-election lies, and because the public were deliberately mislead by several statements from the Tories, saying there would be “no cuts to tax credits,”  that “constitutional convention and niceties are not a priority.”

Meanwhile, George Osborne has indicated he will seek to calm tensions by softening the impact of the planned cuts which have been put on hold by the vote in the Upper House. In language that reflected some of the motion, he told the BBC he would help people struggling in the “transition” period when he delivers his autumn statement on 25 November.

He said: “Unelected Labour and Liberal Lords have defeated a financial matter passed by the elected House of Commons, and David Cameron and I are clear that this raises constitutional issues that need to be dealt with. However, it has happened and now we must address the consequences of that. I said I would listen and that is precisely what I intend to do. I believe we can achieve the same goal of reforming tax credits, saving the money we need to secure our economy while at the same time helping in the transition. That is what I intend to do at the autumn statement.”

The “rapid review” will establish ways of guaranteeing that “financial measures” cannot be overturned by the House of Lords despite the fact that Labour successfully argued that because the tax credits were being introduced through a statutory instrument and had not been declared as a formal financial measure, the move in the Upper House was justified. The review will examine ways of guaranteeing that statutory instruments cannot be overturned by the Lords, who have only done so on five occasions.

Downing Street and Treasury officials spoke after Hollis’s motion was passed by 289 to 272 votes. Peers also voted in favour of a milder motion by the crossbench Peer Lady Meacher – by 307 to 277 votes – that also declined to support the cuts until the government responds to the Institute for Fiscal Studies analysis of the negative impacts of the Bill. A fatal motion, tabled by the Liberal Democrat Peer Lady Manzoor, would have halted the Bill, but it was defeated by 310 votes to 99.

During the Lords debate, Baroness Smith said that 60% of the population want to see a u-turn on this policy. She also points out that the original Labour tax credit legislation wasnt subject to financial privilege. She also said that the government truncated the legislative process to introduce a wide reaching and radical change of policy, to avoid a degree of scrutiny. Baroness Hollis urged peers to support the working poor, not government. She argued that the Commons votes were taken based on incomplete evidence.

John McDonnell, the shadow Chancellor, said: “George Osborne has got to think again. He has been defeated twice in the House of Lords tonight, but there are a large number of Conservative MPs as well who have been telling him very, very clearly he has got to think again.”

Just hours before the Lord’s debate, fresh evidence emerged of the potential impact of the tax credit changes on low-paid employees.

Policy in Practice, a welfare-to-work consultancy, calculated that some workers will be able to keep just 7p in every extra £1 they earn, effectively putting them on a 93 per cent marginal tax rate.

The report concluded the overall package of measures – including raising the national minimum wage and increasing the tax allowance – would leave two-thirds of claimants worse off and warned that owner-occupiers would be worst affected.

The calculations were revealed by the Conservative-supporting Spectator, which has urged a rethink of the policy that has been likened to the poll tax.

4-38-degrees-get.jpgA 38 Degrees campaigner outside the Houses of Parliament. An online campaign sought to drum up support among members of the Second Chamber to vote against motion.

Courtesy of Getty images.

Government defeated twice on tax credit cuts in House of Lords

Lords voting

I doubt there’s a single person on low pay that is happy about the Conservative proposals to cut their tax credits and subsequently, their living standards, further. Today, research by welfare reform group Policy in Practice comes as peers prepare to debate George Osborne’s proposals, and it concludes that two-thirds of working tax credit recipients will be worse off in 2020.

The tax credit cuts were deliberately left out of the Tory manifesto, and when asked directly if his government was going to cut tax credits, Cameron chose to lie and said no. Now the Conservatives are claiming that this policy, never declared before the election, is somehow a “central plank” of the budget. The claim that Conservatives had previously declared cuts to welfare doesn’t stand up to scrutiny, either, because they did not specify what cuts they would make, despite being asked several times, and they claim to be a party that is all about “making work pay”. 

The Conservatives are claiming that the cuts were “democratically voted” through in the House of Commons, yet their majority in the lower House may not have happened at all, had they been honest prior to the election and declared their intention to cut people’s tax credits. 

The threats issued to the Upper House from the government arose  because the Conservatives are facing defeat on what is an extremely unpopular reform, even amongst their own party ranks, and are truly remarkable, showing a contempt for democratic process and a lack of willingness to engage in genuine, transparent democratic dialogue.

Earlier this year, the Institute for Fiscal Studies (IFS) asked George Osborne to specify how he will reach targets announced in the budget, given that the poorest had been the hardest hit by draconian benefit cuts already. The IFS said that the worst of the UK’s spending cuts are still to come.

I said at the time that it’s not that Osborne can’t answer the IFS challenge: he won’t.

David Gauke, the Treasury secretary at the time was pressed repeatedly on the BBC’s Daily Politics to explain if the Tories would detail their planned welfare cuts beyond the £3billion previously specified.

He replied: “We will set it out nearer the time which will be after the election.”

Pre-general election television comments have exposed Prime Minister David Cameron’s lies about his party’s proposal to reduce child tax credits. During a special episode of BBC’s Question Time, aired in April, presenter David Dimbleby asks: “There are some people that are worried about you cutting child tax credits, are you saying absolutely as a guarantee that you’d never have it?”

To which the Prime Minister responds: “First of all child tax credit we increased by 450 pounds …” Dimbleby interjects: “And it’s not going to fall?” to which the PM clearly replies: “It’s not going to fall.”

It’s therefore a bit much to hear lectures on democratic process from a government that was so dishonest to the electorate before the election.

Following an impassioned, powerful and eventful three-hour debate, the Lords voted by 289 votes to 272 – a majority of 17 – for low-income families to be given “full transitional protection” from the cuts for at least three years.

They also supported a motion by 307 votes to 277 – a majority of 30 – calling for the cuts to be delayed until the Government responds to analysis of their impact by the Institute for Fiscal Studies and considers “mitigating action”.

Lord Campbell observed in the House of Lords Tax credit debate today that because of the Conservatives pre-election lies, and because the public were deliberately misled by several statements saying there would be “no cuts to tax credits,”  that “constitutional convention and niceties are not a priority.”

There are three separate motions from the Liberal Democrats, Labour and the crossbenchers presented to the Peers, calling for the cuts to be either scrapped or paused and re-scrutinised after further evidence has been gathered. The Liberal Democrats want to completely scrap the changes, which is a risky tactic that many have deemed a “fatal motion.” Labour are seeking to delay the changes, so that the Commons may re-scrutinise them in light of new evidence, and respond to that evidence, to mitigate the impact on the poorest, and crossbencher, Lady Meacher, is also calling for a delay in the cuts.

During the Lords debate, Baroness Smith said that 60% of the population want to see a u-turn on this policy. She also points out that the original Labour tax credit legislation wasnt subject to financial privilege. She said that the government truncated the legislative process to introduce a wide reaching and radical change of policy, to avoid a degree of scrutiny. Baroness Hollis urged peers to support the working poor, not government. She argued that the Commons votes were taken based on incomplete evidence. Her very powerful speech was delivered to a completely silent Upper House.

Labour’s shadow Lords leader Baroness Smith expressed her regret that the focus of the debate has been largely on the constitution rather than the people that will be affected by the changes.

She said there is “no constitutional crisis at all”, and “peers will not exceed their powers but will also not be cowed in their responsibility to hold the government to account.”

The Clerk of the Parliaments has confirmed that Commons financial privilege does not extend to statutory instruments. Many Peers have pointed out throughout the debate that welfare policy isn’t “budgetary.”

Conservative Chancellor Lord Lawson said: “I am torn because I believe there are aspects to these measures which need to be reconsidered and indeed changed. The great harm, or a great deal of the harm, is at the lowest end and that is what needs to be looked at again. That is what concerns me.

I think it is perfectly possible with tweaking it to take more from the upper end of the tax credit scale and less from the lower end of the tax credit scale.”

He also said  “It is not just listening which is required [from the government] but change”.

Baroness Hollis said that the government will save money as a result of the increase in the minimum wage. And by 2019 most tax credit claimants won’t be claiming tax credits because they will be on universal credit. Taken over the course of the parliament, the government will be making savings, “probably exceeding the very cuts the government demands,” she said.

The Reverend Christopher Foster pointed out that wage levels are low and the cuts are likely to have a very negative impact, including raising indebtedness, social injustice, damaged lives, ruining life chances, with detrimental consequences to mental health. He said this government provides  “a carrot for some, a stick for others” .

He went on to say that the cuts to the poorest are morally indefensible – “a punishment, not encouragement”.  He urged a vote in the interests of the poorest workers, saying he was appalled at the government for “masking the issues.” He called for house to clearly express disapproval at the government proposals. He said: “The Bill is not acceptable in its current form.” Like others, he emphasised that the government has moral obligations, and needs to do more than simply meeting fiscal targets.

Conservative Lord Mackay tried to argue a case for Commons financial privilege, as did other Conservative peers, including Lord Tebbit.

Baroness Lister pointed out that no impact assesment was carried out regarding the cuts, and said “the Bill is an example of none evidence-based policy making.”

She said “It betrays a lack of understanding of policy and people’s lives,” and added “getting an impact assessment from the government is like pulling teeth”.

She also pointed out that the cuts will affect protected groups. Carers and disabled people will be negatively impacted, and the self-employed won’t have their losses offset at all by the “living wage.”

She cited the Resolution Foundation research, that finds 200, 000 children, rising to 600,000 by 2020, will be plunged into poverty because of the proposed cuts. She said there is “no adequate defence of policy – lone parents will be hardest hit. Tax allowances and the living wage won’t mitigate the impact.”

She concluded that child tax credits were introduced to address child poverty, and that the Bill penalises hard work. She pointed out that “the House of Lords has a role of scrutinising policy – and this policy doesn’t stand up to scrutiny”.

The first vote was on Liberal Democrat Baroness Manzoor’s amendment to move to the above motion: “to leave out all the words after “that” and insert “this House declines to approve the draft Regulations laid before the House o7 September.”

This would have killed off the legislation, but it was defeated by by 310 votes to 99 – a majority of 211.

Five reasons the Lords should vote to block tax credit proposals today – Policy in Practice

Policy in Practice was asked to pull together a briefing note on the changes to tax credits ahead of the showdown today in the House of Lords.

We work with our local authority partners to carry out detailed, household level analysis on the impacts of reforms now, all the way through to 2020. We take into account a sample of over 100,000 working age households, and assess the cumulative impact of tax and benefit reforms on household income.

Our findings were put succinctly by a benefits manager in a Conservative constituency:

‘The government wants people to work, but this goes against that’.

Policy in Practice is working with local authorities to map the impacts of welfare reforms on each low income household. To understand more about how we can help you to understand how people in your local authority will be impacted, click here.

1. Two-thirds of Working Tax Credit recipients can expect to be worse off in 2020

Based on analysis on over 100,000 households of working-age in receipt of Housing Benefit and Council Tax support, and taking into account the impact of the National Living Wage at £9.00 per hour, and a personal tax allowance of £12,500, we find that 67% of Working Tax Credit recipients will still be worse off in 2020, compared with today.

* Analysis update: We have updated our analysis this morning to take into account the 30 hours of free childcare that will be available to three and four year olds. If we assume that all households with children age three to four will be better off (which may not necessarily be the case) we find that half of all Working Tax Credit recipients within our sample will still be worse off in 2020.

2. Owner-occupiers will be among the hardest hit when the reforms first land in April 2016

Tax credit savings will be partly offset by higher Housing Benefit and Council Tax Support payments. Because tax credits reduce entitlement to other benefits, 57% of tax credit savings will be offset by increased Housing Benefit and Council Tax Support.These savings will not by spread evenly. Many owner-occupiers, who do not receive Housing Benefit, will not have their tax credit cuts mitigated and may find themselves pushed into crisis.

Some in receipt of Housing Benefit and Council Tax Support will see their support increase by up to 85p for each pound lost in tax credits. This support, which offsets the some of the impact of the cuts, will erode over time due to increased earnings under the National Living Wage. Higher earnings cause tax credits, Housing Benefit and Council Tax Support to be withdrawn, often simultaneously.

3. Work incentives will be weakened within tax credits and Universal Credit

A higher withdrawal rate will make it harder for people that try to earn their way back to their original standard of living. Working Tax Credit recipients that choose to counter the loss by increasing their earnings will lose up to an additional 7p for each pound earned. Effective tax rates may increase up to 93p in the pound.

4. Higher effective taxes make it harder to respond by increasing earnings, while people on low or no earnings will not be affected

To qualify for Working Tax Credit, households have to work a certain number of hours to be considered in remunerative work: 16 hours per week for lone parents and disabled people, 24 hours for couples with children and 30 hours for people without children. The option to increase their working hours may be limited, and will be penalised by a higher withdrawal rate of tax credits.

Tax credit recipients who are not in work and the lowest earners, including self-employed households (some of whom are thought to under-report their earnings) will not be impacted by these changes. Those that contribute most to the economy will be hardest hit.

5. The government was elected to reform the welfare system to make work pay

Low effective tax rates within tax credits and Universal Credit reward enterprise and endeavor, help lower earners, and aid progression in work. They ensure that more of the benefits of a National Living Wage and a lower tax threshold reach lower earners. Protecting the lower withdrawal rate within tax credits would send the message that this government is the party not only of low taxes, but of low effective taxes.

Identify which households will be impacted in advance

We find that frontline advisors within local organisations want to work with the government to support people toward greater independence, and to deliver on the policy intent. However, too often they don’t feel they have enough information to properly advise their customers.

To avoid leaving advisors on the back foot, local authorities including Birmingham, Newcastle, North Hertfordshire and Hounslow, are working with Policy in Practice to map the impact of welfare reforms on each individual household on a low income within their local authority.


This article was originally published today on the Policy in Practice site. You can read the original here.

Osborne’s tax credit omnishambles reveals the profound elitism of the Tories

Chancellor George OsborneI don’t know a single person on low pay that is happy about the Conservative proposals to cut their tax credits and subsequently, their living standards, further. This policy was deliberately left out of the Tory manifesto, and when asked directly if his government was going to cut tax credits, Cameron chose to lie and said no. Now the Conservatives are claiming that this policy, never declared before the election, is suddenly somehow a “central plank” of the budget. The claim that Conservatives had declared cuts to welfare doesn’t stand up to scrutiny, either, because they claim to be a party that is all about “making work pay”. 

The Conservatives are claiming that the cuts were “democratically voted” through in the House of Commons, yet their majority in the lower House may not have happened at all, had they been honest prior to the election and declared their intention to cut people’s tax credits. 

Furthermore, the cuts were presented in the form of secondary legislation – as a Statutory Instrument – which notoriously receive little scrutiny and very limited debate time in the Commons. Statutory instruments are intended to be used for simple, non-controversial measures, in contrast to more complex items of primary legislation (known as Bills.) The Government always ensure they have a majority on any Statutory Instrument committee and the MPs are chosen by Whips. This enables government to push through their legislative programme with very little scrutiny, exacerbating a lack of democratic transparency and accountability of the Executive.

The threats issued to the Upper House from the government arose because the Conservatives are facing probable defeat on what is an extremely unpopular reform, even amongst their own party ranks, and are truly remarkable, showing a contempt for democratic process and a lack of willingness to engage in genuine, transparent democratic dialogue.

Earlier this year, the Institute for Fiscal Studies (IFS) asked George Osborne to specify how he will reach targets announced in the budget, given that the poorest had been the hardest hit by draconian benefit cuts already. The IFS said that the worst of the UK’s spending cuts are still to come.

I said at the time that it’s not that Osborne can’t answer the IFS challenge: he won’t.

David Gauke, the Treasury secretary at the time was pressed repeatedly on the BBC’s Daily Politics to explain if the Tories would detail their planned welfare cuts beyond the £3billion previously specified.

He replied: “We will set it out nearer the time which will be after the election.”

Pre-general election television comments have exposed Prime Minister David Cameron’s lies about his party’s proposal to reduce child tax credits. During a special episode of BBC’s Question Time, aired in April, presenter David Dimbleby asks: “There are some people that are worried about you cutting child tax credits, are you saying absolutely as a guarantee that you’d never have it?”

To which the Prime Minister responds: “First of all child tax credit we increased by 450 pounds…” Dimbleby interjects: “And it’s not going to fall?” to which the PM clearly replies: “It’s not going to fall.”

As Simon Szreter, Professor of history and public policy at the University of Cambridge, points out about the party claiming “A Britain that rewards work” as its slogan:

It is a measure of just how much George Osborne’s post-election attack on tax credits represents an assault of genuinely historic proportions on Britain’s poor that his PM has made reference to the 1911 Parliament Act in his railing against popular protest and his fear of blocking measures in the House of Lords. Let us remember why the act was brought in by the Liberal government of Asquith and Lloyd George.

The landed wealth elite, including men such as George Osborne’s direct ancestors, the Anglo-Irish baronets of Ballentaylor, dominated the House of Lords. They rejected the elected government’s policy – democratically tested at the bar of two general elections in 1910 – to impose new progressive forms of taxation on the super-wealthy to help fund such basic social security measures for the working poor as pensions and the first National Insurance Act.

He goes on to say:

Mr Cameron is darkly mentioning the Parliament Act of 1911 to cow the House of Lords into compliance because the upper chamber is no longer exclusively the club of the wealth elite as it was in 1911. The alternative, as Mr Cameron’s timely recollection of the 1911 Parliament Act reminds us all, is for parliament to ensure that the financial elite pay their way more fully in our society, a case that is all the more compelling considering their undisputed role in punching a hole in the nation’s finances in 2008.

The problem today is not control over the House of Lords. Today’s financial elite have found that it is much more efficient to exert their control over the House of Commons itself. This they do though a Tory party that is almost entirely funded by them and whose administration is safely in the hands of a chancellor who fully appreciates the importance of looking after the interests of the nation’s wealth elites. After all, he is the future 18th baronet of Ballentaylor.

Even Conservative MPs, such as Heidi Allen, have pointed out the hypocrisy of the proposed tax credit cuts. But as I’ve pointed out previously, the slogan “making work pay” has a lot in common with the 1834 Poor Law principle of less eligibility, rather than it being a genuine statement of intent from the Tories. Unless of course, you ask “Making work pay for whom?”

Further cuts to provisions, services and welfare – support for the poorest – is unthinkable and untenable, especially when there are other choices that the government could have made.

For example, the prime minister made it clear that lavish tax cuts for the better off will be the £7bn prize for returning him to Downing Street. This came after a £48bn in public service cuts, the like of which the country has never known.

“The people whose hard work and personal sacrifices have got us through these difficult times should come first,” Cameron said.

So who exactly worked hardest and took the heaviest burdens – and what exactly will be their reward? Certainly not those who made most sacrifices – the same low earners whose working tax credits and benefits George Osborne will happily cut again by another £12bn.

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Tax Credits Cuts ‘Will Widen The Gap In Inequalities’

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There is no such thing as a ‘one nation’ Tory: they always create two nations

Conservatism in a nutshell

The word “Tories” is an abbreviation of “tall stories”

Conservative policies are in breach of the UN Convention on the Rights of the Child

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The Children’s Commissioner has criticised the Conservative’s tax credit cuts and called for measures to reduce the impact that the changes will have on the poorest children. Anne Longfield OBE, who was appointed last November, taking up her role on 1 March 2015, is calling on the government to exempt 800,000 children under five from tax credit cuts and to offer additional support to families with a child under five-years-old.

The role of Children’s Commissioner was established under Labour’s Children Act in 2004 to be the independent voice of children and young people and to champion their interests and bring their concerns and views to the national arena. The Commissioner’s work must take regard of children’s rights (the United Nations Convention on the Rights of the Child) and seek to improve the wellbeing of children and young people.

I reported last year that the Children’s Commissioner (then Maggie Atkinson) had already warned the government that the UK is in breach of the UN Convention on the Rights of the Child. As Chancellor George Osborne prepared his mid-term (Autumn) budget statement last year, the government’s Children’s Commissioner for England published a report criticising the Coalition’s austerity policies, which have reduced the incomes of the poorest families by up to 10 percent since 2010.

The Children’s Commissioner said that the increasing inequality which has resulted from the cuts, and in particular, the welfare reforms, means that Britain is now in breach of the United Nations Convention on the Rights of the Child, which protects children from the adverse effects of government economic measures.

Another report from the Social Mobility and Child Poverty Commission at the time indicated some very worrying trends regarding decreasing living standards, increasing employment insecurity and low pay, and the return of significant, rising levels of absolute child poverty not seen in the UK since the advent of the welfare state. Until now. (See the findings from the State of the Nation report.)

Dr Maggie Atkinson, the Children’s Commissioner, said: 

“Nobody is saying that there isn’t a deficit to close. Our issue is that at the moment, it is the poorest in society who have least to fall back on that are paying the greatest price for trying to close that deficit. It is patently unfair. It is patently against the rights of the child.”

Dr Atkinson added that this means the UK has broken the UN Convention on the Rights of the Child, under which each country is obliged to protect children from the detrimental consequences of economic policies. The Commissioner condemned the government for placing undue financial pressures on poorer parents, despite being one of the most developed countries in the world.

However, the government rejected the findings of what they deemed the “partial, selective and misleading” Children’s Commissioner report.

The Commissioner has again written to the Chancellor to call for children in the poorest families aged under five to be protected from the cuts.

However, Osborne is pretty unrepentant, yesterday he warned the House of Lords not to “second guess” the Commons on “financial matters.” He even went so far as to claim the cuts had been endorsed at the general election, which of course is untrue. The Conservatives have threatened the House of Lords with a constitutional shake-up show-down if they continue to oppose the tax credit cuts.  It’s highly unlikely that the Conservatives will back down over the tax credit cuts.

A damning joint report written by the four United Kingdom Children’s Commissioners for the UN Committee on the Rights of the Child’s examination of the UK’s Fifth Periodic Report under the UN Convention on the Rights of the Child (UNCRC), dated 14 August 2015, says, in its overall assessment of the UK’s record:

“The Children’s Commissioners are concerned that the UK State Party’s response to the global economic downturn, including the imposition of austerity measures and changes to the welfare system, has resulted in a failure to protect the most disadvantaged children and those in especially vulnerable groups from child poverty, preventing the realisation of their rights under Articles 26 and 27 UNCRC.

The best interests of children were not central to the development of these policies and children’s views were not sought.

Reductions to household income for poorer children as a result of tax, transfer and social security benefit changes have led to food and fuel poverty, and the sharply increased use of crisis food bank provision by families. In some parts of the UK there is insufficient affordable decent housing which has led to poorer children living in inadequate housing and in temporary accommodation.

Austerity measures have reduced provision of a range of services that protect and fulfil children’s rights including health and child and adolescent mental health services; education; early years; preventive and early intervention services; and youth services.

The Commissioners are also seriously concerned at the impact of systematic reductions to legal advice, assistance and representation for children and their parents/carers in important areas such as prison law; immigration; private family law; and education. This means that children are denied access to remedies where their rights have been breached.

The Commissioners are also concerned at the future of the human rights settlement in the United Kingdom due to the UK Government’s intention to repeal the Human Rights Act 1998 (HRA) which incorporates the European Convention on Human Rights (ECHR) into domestic law; replace it with a British Bill of Rights (the contents of which are yet to be announced), and ‘break the formal link between British courts and the European Court of Human Rights’.

The HRA has been vital in promoting and protecting the rights of children in the United Kingdom and the European Court of Human Rights has had an important role in developing the protection offered to children by the ECHR.The Commissioners are concerned that any amendment or replacement of the HRA is likely to be regressive.”

You can read the report in full here