Monday, January 20, 2020

Labour Calls For Inquiry Into Tax Credits Cuts – After Refusing To Vote Against Them

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The UK government’s tax credits cuts should be scrutinised by the Work and Pensions Select Committee, says Harriet Harman.

In a letter to the Prime Minister, the interim Labour leader accuses David Cameron of trying to push through tax credits cuts without proper scrutiny.

It has emerged that tax credits cuts will not form part of primary legislation for the government’s ‘Welfare Reform and Work Bill‘, but will instead be imposed through the use of legislation known as a “statutory instrument”.

This legislation would only need to be approved by a committee of no more than 15 MPs and the process would take no longer than 45 minutes. It would also be immune to any amendments.

Ms Harman reminds the Prime Minister that when asked if he would cut child tax credits prior to the general election, he responded: “No, I don’t want to do that.”

She also challenges claims made by George Osborne that cuts to tax credits would be offset by the introduction of the so-called ‘National Living Wage‘ (NLW). This will start at £7.20 and rise to £9.20 per hour by 2020.

Research by the Institute for Fiscal Studies found that despite of the NLW, 13 million families would still be left worse-off by an average £260 a year – caused by reductions to tax credits and benefits. Some of the worse affected families could lose £1,000 or more.

Mr Osborne announced in the budget that families would no longer receive child tax credits or housing benefit for more than two children.

He also revealed plans which would reduce the amount a household can earn before working tax credits begin to be withdrawn, from £6,420 a year to just £3,850.

In her letter to the PM, Ms Harman says: “Parliament needs to be able to scrutinise this measure which was not in your manifesto, and is substantial and highly controversial.

“These cuts to tax credits hit working families in every constituency, and must not be sneaked through the back door without the chance for MPs to have their say.”

Ms Harman urges the PM to allow the Work and Pensions Select Committee to examine the changes, so that “all the evidence about how people will be worse off will come out.”

Ms Harman told Sky News: “What they’re doing is they think ‘we’ve got elected, even though this wasn’t in the manifesto, we can just shove it through.

“That is not the way they should be doing government and we are determined we’ll oppose them.

“I think there should be a Select Committee Inquiry first, where the Government will have to bring forward their evidence to justify why they don’t think three million people will be worse off.”

She added: “I think we will succeed in making sure this is properly scrutinised and all the evidence about how people will be worse off will come out.”

Labour was heavily criticised after Ms Harman instructed her Party’s MPs to abstain in a vote on the government’s ‘Welfare and Work Bill’.

48 Labour MPs rejected her calls and voted against the Bill, including the leadership candidate Jeremy Corbyn, sparking media rumours of a split in the Party.

MPs voted in favour of the proposed welfare changes and attempts by Labour to amend the Bill were defeated.


Last edited at 04:10 on 31 July 2015 to correct a factual error.


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