In previous articles, we at Academics Stand Against Poverty (ASAP) have highlighted the need for the government to deliver on its commitment to the socioeconomic duty (SED).
The SED requires public bodies to consider how various strategies will address social inequalities. Integrating this approach into a budget would require an impact assessment to consider how proposals outlined by the Chancellor would reduce or potentially exacerbate socioeconomic inequalities. Assessments would have to consider effects on low-income and marginalised communities and areas of deprivation.
Importantly, the reach of the Treasury across all government departments and the guidance it provides through tools such as The Green Book means it is well placed to embed SED impact assessments across all government activity and reflect on the cumulative repercussions across policy.
While the consultation on the SED is still to be reported, the upcoming budget statement offers an opportunity for the government to take the initiative and demonstrate the impact of the duty at the key strategic moment in the political calendar.
In this article, we explore a few benefits that a budget dedicated to the socioeconomic duty could deliver.
Addressing the direct measures of socioeconomic inequalities
Integrating the SED into the budget process would require a determination of measures against which progress to tackle socioeconomic inequalities could be judged. Sufficient data are already collected by various government organisations, which could be used as proxy measures of socioeconomic inequalities to track the consequences of budget (and policy) decisions. Our suggested benchmarks would include:
- Child poverty rates
- Access to health care
- Access to education and educational attainment
- Employment and wage disparities
- Housing affordability and homelessness
To explore a few of these briefly:
ASAP has previously made a case for the use of the SED to guide the child poverty strategy and has argued for measures which use After Housing Costs, with the aim of capturing multiple dimensions of socioeconomic disadvantage.
From income deprivation and access to services, such data provide insights into disproportionate impacts on children’s present contexts, and the likely long-term outcomes that result from child poverty: poorer health, lower educational attainment and reduced employment prospects.
This information already identifies the key groups and locations that suffer from child poverty and can be used to direct support and interventions.
Access to health care provides another key indicator of socioeconomic inequalities. Areas with fewer GP practices, longer waiting lists or shorter life expectancy are all clear indicators of deprivation that can be used to guide policy interventions in relation to the SED. So too can data on higher rates of preventable illness, mental health issues and child mortality, which often correlate with poverty and exclusion.
Public bodies already use this data to identify where health inequalities exist and ensure policies actively reduce these disparities. The key difference is that the SED requires that the data be used within an impact assessment to ensure governments are actively seeking to tackle disadvantage.
Additionally, data relating to unemployment and underemployment rates can reveal how certain communities or demographic groups experience economic exclusion. Data on job quality can provide insights into insecure, low-paid work conditions and precarious employment.
Similarly, data on wage disparities not only highlight gaps between high and low earners in the same regions/sectors, but also gender, ethnicity and disability pay gaps, ensuring intersectionality remains a key part of analysis.
As with the examples above, these data are already gathered and used to highlight persisting social problems. They can also be used to evaluate the impacts of government policies and strategic decisions to achieve the socioeconomic duty.
Considering the indirect impacts on socioeconomic disadvantage
Importantly, an approach such as the one above – in which the government could start to use existing data to set up an impact assessment framework to guide implementation of the SED – is not about advocating for particular policies or approaches. Rather, the SED is offering, in the context of the budget, an assessment of the impact of its proposals on socioeconomic disadvantage.
It can highlight which announcements will work to reduce socioeconomic disadvantage, and which could potentially reinforce or exacerbate it. Not all these impacts will be as directly linked to deprivation as the measures outlined above (child poverty, health inequalities, etc).
In 2024, the budget introduced some changes which many found surprising. An increase in Employer National Insurance (NI) contributions from 13.8 per cent to 15 per cent on a reduced threshold (from £9,100 to £5,000) was one that caught attention. Another was a tax on the business sector, which will have an indirect impact on employees and deepen socioeconomic inequality. The tax change means that employers are paying NI contributions on a larger portion of low-paid workers’ wages, which will disproportionately affect sectors with high numbers of low-income workers, such as social care, hospitality and retail.
Some predict that the changes will reduce employment by 55,000. However, real-time payroll data from HMRC show a 167,000 drop in employee jobs between October 2024 and April 2025, suggesting that the Office for Budget Responsibility (OBR) may have underestimated the impact.
Had the socioeconomic duty been part of the 2024 budget, an analysis of the changes to NI contributions would likely have highlighted disproportionate impacts on low-paid and part-time workers. These impacts include structural risks to job quality and increased precarity in certain sectors and communities. It would have indicated a need to either rethink the change or to explore potential mitigations to prevent these indirect consequences on socioeconomic equality.
The SED and the 2025 budget statement
In its review, ‘The Spirit Level at 15’, the Equality Trust’s first recommendation is to enact the socioeconomic duty. The Trust recognises the importance of SED assessments for tackling the root causes of socioeconomic inequalities. It recommends a dedicated body to oversee the process of such assessments, and to ensure that proposed policies, programmes and projects are examined in relation to their effect on socioeconomic inequalities.
The budget statement is an opportunity for the government to lead the way and demonstrate the effectiveness of the SED and how it can be used to shape strategic decision making at the heart of its planning.
In our previous article, we made the case for removing the two-child limit as one policy that could significantly improve the situation for working-class households. Within the same policy area, the Equality Trust has recommended the need for an Essentials Guarantee to be integrated into Universal Credit, so that the basic rate covers life essentials, including the costs of food, household bills and travel.
Calls for universal basic services provide another important development in policy that could significantly reduce socioeconomic inequalities in the UK. This would not only safeguard access to social services, vital to addressing many socioeconomic inequalities, but could work alongside income guarantees to ensure no one falls below minimum living standards.
Provision of universal basic services could not only reduce costs for low-income households, but also socioeconomic disparities, by ensuring access to essential services regardless of one’s ability to pay. This is the foundation upon which a wider strategy to tackle socioeconomic inequalities, in line with the SED, should be developed.
Lee Gregory is an Associate Professor at the University of Nottingham and Chair of Academics Stand Against Poverty UK Trustees.
Vanessa Boon is a Senior Project Officer at The Equality Trust.
Dave Beck is a Lecturer in Social Policy at The University of Salford.
Read all the articles in the Academics Stand Against Poverty blog series here.
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