Budget: Household Impact

Debate between Lord Wood of Anfield and Lord O'Neill of Gatley

Wednesday 16th September 2015 Lords Chamber

[Lord Wood of Anfield]

To ask Her Majesty’s Government whether they intend to publish a distributional analysis of the impact of the Budget on households with different levels of income.

[The Commercial Secretary to the Treasury (Lord O'Neill of Gatley) (Con)]

My Lords, distributional analysis of the impacts of government policy across household income distribution was published by HM Treasury alongside the summer Budget. The analysis presents the cumulative impacts of policy decisions since the June 2010 Budget, up to and including the 2015 summer Budget. It shows that the proportion of public spending received by households in each income quintile remained similar between 2010-11 and 2017-18.

[Lord Wood of Anfield (Lab)]

I thank the Minister for that Answer. The Institute for Fiscal Studies estimates that the Budget has made 8.4 million working families worse off, many considerably so, through tax credit changes. However, the Chancellor has unilaterally decided not to tell the British public from now on what the distributional impact of the Budget measures will be. It is ludicrous to argue, as he does, that having a deficit justifies not publishing information about the regressive effects of the Budget. Does the Minister agree with the Resolution Foundation, which said:

“Deciding to ditch Budget distributional analysis is a retrograde move for which there is no plausible good explanation”?

Will he urge the Chancellor to rethink this attempt to hide information from the public?

[Lord O’Neill of Gatley]

My Lords, contrary to that question, as a result of some discussions involving the Chancellor, the specific distributional analysis that was requested was posted on the government website on 21 July. There followed a number of conversations outlining the Treasury’s belief that the new analysis was intellectually superior to those in the preceding Parliaments. I should add, however, that the requested distributional analysis has indeed been published, despite the apparent lack of awareness of it displayed in the previous question.