(9 years, 10 months ago)
Commons ChamberI beg to move,
That this House believes it is a mistake to reduce the top rate of income tax at a time when working people, who are on average £1,600 a year worse off since 2010, are not feeling the recovery and while the deficit also remains high; notes that figures from the Institute for Fiscal Studies show that, by next year, households will be on average £974 a year worse off because of tax and benefit changes since 2010; believes that a fair plan to balance the books would reverse the cut in the top rate of income tax, which is worth £3 billion a year for the top one per cent of earners, for the next Parliament, and introduce a lower 10p starting rate of tax; and calls on the Government to rule out a further reduction in the top rate of income tax on earnings over £150,000 a year.
Four and a half years into this Government, the squeeze on lower and middle earners is as bad as ever. Wages are still failing to keep pace with prices, and the typical working person is £1,600 worse off. This is the longest suppression of living standards since the 1870s, and my Labour colleagues know that this gap is getting wider and wider. This Government are presiding over one of the worst records on income growth of any European country—only Portugal, Cyprus and Greece have seen wages erode more severely than we have. For most people, there is no economic recovery at all.
When the Chancellor was asked, however, in a recent ITV news interview why there was no feel-good factor, his answer was, “Well, I simply don’t accept that.” Of course, in the world the Chancellor and the Prime Minister inhabit life is sweet. Someone lucky enough to be in the richest 1% of society has seen their share of the nation’s income grow considerably. Over the past year, the share of the national post-tax income of the top 1% of taxpayers—just 300,000 people—has risen from 8.2% to 9.8%, whereas the bottom 90%, a total of 27 million taxpayers, have seen their share fall from 71.3% to 70.4%. Those are Her Majesty’s Revenue and Customs’ own statistics. That most privileged 1% elite have not just seen their fortunes grow by chance while others have fallen behind; they have been actively helped along by a cut in income tax for those earning more than £150,000. The shrinking share of national wealth held by the vast majority when compared with the growing share held by the richest does not represent a recovery for the many rather than the few.
Will the hon. Gentleman concede that the coalition Government, thanks to the input of the Liberal Democrats, have raised millions of people out of paying any income tax? Will he give an assurance that should there be a Labour Government they will match the pledge to raise to £12,500 the level before which income tax is levied?
There are a number of facets to the hon. Gentleman’s question. Let us just remember that it was the Liberal Democrats who voted to cut that top rate of income tax from 50p to 45p.
(11 years, 4 months ago)
Commons ChamberAlthough the Minister had quite a long preamble, not necessarily on these amendments, all I would say is that, clearly, with life expectancies increasing, it is in general reasonable to ask people to work for longer before retirement. There is no disagreement on that general principle. We need to adjust the public service pension schemes so that they remain sustainable, which is why we support so many of the changes Lord Hutton recommended. However, as hon. Members know, there are certain categories of workers for whom having longer careers is not realistic because of the physical demands of their professions. There are some physical tasks that it is not reasonable to expect a 67 or 68-year-old to undertake.
The Bill acknowledges that in part, by excluding three categories of worker— firefighters, police officers and members of the armed forces—and fixing their normal pension age at 60. That is a rational position, but there are other professions that we believe the Government should keep under review because they also can be exceptionally physically demanding, such as NHS paramedics and care workers. There is clearly a need for some flexibility to accommodate scheme-specific capability reviews for these associated professions, and it is a great shame that the Government have not allowed the latitude for that in the Bill. We debated that in Committee.
Lords amendments 78 and 79 are aimed at correcting what most people thought to be an oversight: the fact that, for some bizarre reason, Ministry of Defence firefighters and MOD police officers are excluded from the definitions of firefighters and police officers in the Bill. There are about 2,000 MOD police and 1,000 or so MOD fire and rescue scheme workers who essentially carry out the same crucial, but onerous, tasks as police and fire service workers under the auspices of the police authorities and the Home Office.
In addition to the point the hon. Gentleman has just made, does he agree that, particularly with regard to Faslane and the nuclear submarines and installations there, MOD firefighers and police officers carry out duties that the civilian police and firefighters do not have to do?
I am grateful to the hon. Gentleman for making that point, because I think that is indeed the case, but my general point is about the physical demands on these individuals. Today we are debating whether their retirement age should be, as the Minister thinks, 67 or above, or whether it should be at 60—the same age as for other firefighters, police officers and members of the armed forces. It is a simple proposition and the House has the power to make a judgment on it today.