Tory austerity shrinks economy by ÂŁ117bn

A boost in public finances has been built “on the back of failing public services, painful sacrifices by working people and the dreadful punishment of our most vulnerable”, Unite has said.

Official figures showed that tax revenue in January was ÂŁ14.9bn higher than public spending, even as two new studies found that the economy has been harmed because of austerity and child poverty is increasing.

Tory austerity has resulted slower economic growth each year since 2010 and left every household ÂŁ3,600 a year worse off, according to a report by the New Economics Foundation think tank.

The report found that the combined effects of more than a decade of Tory austerity will have shrunk the British economy by ÂŁ117bn a year by 2023.

Meanwhile, a report by the Resolution Foundation said that unless the government changes its draconian cuts to welfare child poverty risks new highs.

The foundation said average family incomes are “not forecast to rise materially over the next two years” and that during the last two years wages had experienced “stagnation”.

Although the UK is experiencing record employment levels – predominantly built on insecure, low paid work – the foundation said weak wage growth since the 2008 financial crisis has combined with benefit cuts to hit the most vulnerable the hardest.

The foundation stated that wage growth – which sits at 3 per cent – is projected to stay under the pre-crisis rate of 4 per cent, saying that there’s a “huge risk that.. incomes stagnate over the next few years”.

Unite assistant general secretary Steve Turner said, “The government’s surplus has been built on the back of failing public services, painful sacrifices by working people and the dreadful punishment of our most vulnerable. Child poverty is up, wages are down and the economy is stalling – all thanks to Tory austerity.

“Instead of saving money by attacking the poor, the disabled, the elderly and the young and the services working people rely on, the government could raise tax revenue by investing in an economy that works for everyone and tackling labour exploitation and tax avoidance by those who hold the vast majority of the wealth.”