Britain’s third woman prime minister, Liz Truss, delivered a budget which, in just the space of a few days, has made the lives of many women materially worse.
Our first, Margaret Thatcher, believed that she “owed nothing to women’s liberation”, to feminism, according to her biographer. It has often been said that she smashed the glass ceiling and then pulled the ladder up behind her because she favoured no policies which furthered gender equality and rarely promoted women to her cabinet.
Well, if Thatcher pulled the ladder up behind her, Truss was prepared to throw it into an incinerator because in just three weeks as prime minister she has announced policies which could reduce gender equality by diminishing women’s chances of gaining economic equality.
How did Liz Truss do it?
Let’s start with Truss’s first “mini-budget” (it was, in fact, a mega economic plan) which was delivered by her chancellor of the exchequer Kwasi Kwarteng on Friday 23 September.
In it, the pair promised to borrow money to fund tax cuts which will overwhelmingly benefit higher earners, the richest people in society.
This is not a policy which helps women. Men are nearly five times more likely than women to earn the highest salaries in Britain, according to the government’s own figures.
After a week of public outcry, Truss and Kwarteng were forced to change their minds on Monday 3 October because even members of the Conservative Party were openly speaking out against it. Former cabinet minister Michael Gove described it as "a mistake".
But the tax cut wasn't the only aspect of the budget that risks driving inequality.
The budget also promised to cut stamp duty “permanently”. Stamp duty is a levy which taxes property sale.
The majority of homeowners in Britain are still men. On average, though the gender pay gap has been closing slowly, women still earn less than men and, as things stand, the Women’s Budget Group has repeatedly warned that there is not a single place in Britain where it is affordable for a woman on her own to rent or buy a home.
They are also reportedly looking at what they call “efficiency savings” which could be austerity 2.0. “Savings” mean cuts to public spending.
On top of that, the government will not be helping government departments that are struggling to help people with rising costs. Because inflation is rising and causing the cost of essentials to go up, people who rely on state support are struggling due to the fact that their benefits are not going up in line with inflation. Though the government have changed their minds about cutting top rate taxes, Kwarteng has since ruled out giving government departments the £18billion needed to compensate for higher than expected inflation.
This will also likely hurt women most because cuts to public services always do.
When former prime minster David Cameron and former chancellor of the exchequer George Osborne introduced austerity – their programme of savings on state spending – it was women who bore the brunt. According to analysis from Ellie Mae MacDonald, a researcher at the Global Policy Institute, the last round of austerity meant changes to Universal Credit and cuts to services and public sector jobs which increased the number of women living in poverty, relative to men.
£22billion of the £26billion “savings” after June 2010 came from women. Single mothers, the social group with the highest poverty risk (at 50%), were particularly vulnerable then, as they would be again because they are likely to need state support for childcare or housing.
So far, so unequal.
But what now?
You may remember that by Monday 26 September, the chaotic moves of Britain’s new government had caused complete economic and financial chaos.
International markets responded to their plans – which are very unorthodox because borrowing to fund tax cuts during periods of high inflation (the rising cost of essentials like your energy bill and food shop) is considered very risky – with shock.
The pound fell to its lowest level against the dollar since 1985. It has since rallied. But tanking the pound caused bond prices to collapse pushing yields (that’s the interest rate the government borrows at) up (suggesting that investors now want a higher return for lending to Britain because it is considered risky). The cost of borrowing was suddenly more expensive for the UK than for either Greece or Italy. Two countries who have historically had weaker economies than Britain.
This is not an abstract problem which resides in the realm of economic theory and political debates had by people in suits in Westminster. It has directly impacted real people.
By Tuesday 27 September, major mortgage lenders had withdrawn new mortgages and stopped lending because they needed to reprice their loans at higher rates. This means that not only are house prices historically high, borrowing to buy one just got more expensive.
These higher mortgage rates will stick around. And, once again, this will hurt women, who earn less than men, more. And, on top of that, anyone who does have a mortgage which is coming to the end of its fixed-term, is going to find that they pay more interest on their loan. Renters haven’t escaped the fallout of Truss and Kwarteng’s budget, either. Experts like the lobby group Generation Rent fear that landlords who have mortgages will cast their increased costs onto their tenants.
In Scotland, first minister Nicola Sturgeon described pressures on household budgets as a “humanitarian emergency” at the start of September and promised an emergency rent freeze to protect people from spiralling housing costs.
Truss has offered absolutely nothing for renters but she may have made things worse for them. Once again women, who are less likely than men to be able to find somewhere affordable to live, are left unprotected.
What do the experts think?
Truss and Kwarteng believe, and maintain, that their plans will prevent a recession and encourage our economy to grow. They were warned by government officials that volatility and economic shocks were a likely consequence of their decisions but they went ahead anyway. Economists all over the world disagree and the International Monetary Fund (IMF) – an international financial institution which is part of the United Nations – has urged them to reconsider their policies.
Experts are very worried that Liz Truss’s economic plan could actively harm gender equality in Britain.
On potential cuts to public spending, Stephenson said “the public sector has been stripped to the bone in the last 12 years. There are no more cuts to make.”
She continued to point out that it is the areas women work in – both paid and unpaid – and rely on for support which are always first on the chopping block.
“If we're thinking about adult social care, childcare or children's services – all of the services that women rely on and use and work in – those are going to likely be hit by another wave of austerity cuts,” Stephenson said. “I mean, you can call them efficiency savings, but it's cuts by any other name.”
Well, women can’t be independent if the economy is stacked against them.
“It’s important to have more women in politics and public life,” Stephenson concluded, “because women make up half the population.”
“But what women actually also need is a prime minister who delivers policies that will benefit them make their lives easier. And we've clearly seen that this hasn't happened with Liz Truss and, actually, what's going on right now will make gender based inequality and financial inequality worse for women.”
When Truss took office, things were bad. Inflation was soaring – meaning everyday living was more expensive – and the Bank of England was putting interest rates up – meaning that repaying debts was getting costlier, too. A few weeks in, somehow, they look an awful lot worse women, particularly those on lower incomes. Independent Women by Destiny’s Child is a capitalist anthem that is all about women’s spending power, about their ability to buy themselves material things. So far, with Liz Truss as prime minister, that has become harder.
Editor's note: Updated with author’s edits on Monday 3 October