Tax Credits (Income Thresholds and Determination of Rates) (Amendment) Regulations 2015

Earl of Listowel Excerpts

Monday 26th October 2015 Lords Chamber

[Baroness Meacher]

That is exactly the point I just made. The important point is that if we pass these regulations the debate in the House of Commons—the elected House—will be an irrelevance. The Government can say, “We have got our regulations. We can press ahead with our cuts. The elected House can say what it likes, we will not have to listen to it”. I am not saying they will say that, but they certainly could say that. The important point is that we need to protect the democratic process. The only hope for the Government is that the bullying tactics may persuade Conservative MPs and our colleagues to avoid defeat. At the moment, the situation in the elected House is that eight Conservative MPs have put their names to a Motion which means that the Conservative Government do not have a majority in the other House.

[The Earl of Listowel (CB)]

My Lords, does my noble friend not find it interesting that the Government are currently taking a Bill through this House that will remove the democratic choice of local people about whether their local school should become an academy? Indeed, during the introduction of academies, academies were taken out of the responsibility of local authorities and placed with the Secretary of State. In this Bill, in future local people will not be able to vote on whether they wish to have their local school turned into an academy. This is a very substantial change because, as I understand it, they are so concerned that the education of our children is so important that no coasting school should be allowed to continue. Therefore, they will take all means possible to ensure that our children get the best education possible. In this case, my noble friend is not asking for that change. She is asking merely for a delay so that the other House can think again. That is a much more minor change to make. Does she agree?

[Baroness Meacher]

I thank my noble friend Lord Listowel. I should mention that a petition signed by 270,000 members of the public over the weekend was handed to me this morning. There is huge fear and anger about these cuts. I am very grateful for the support of the public and the media—believe it or not—and their appreciation of the efforts in this House, although I personally never sought any of it. That is a rather important point to make: I am really not here to grandstand.

I support the Government’s raising of the tax threshold, the increase in the minimum wage and free childcare for three and four year-olds, but those measures will not protect the most vulnerable. The Institute for Fiscal Studies makes clear in its analysis that the biggest losers from the 2015-16 tax and benefit changes, even by 2020, will be the poorest working families. The very poor will hardly gain at all from the increase in the minimum wage or the national living wage. Very poor self-employed people will not gain at all from the increase in the minimum wage. I have had a pile of emails from self-employed very poor people. The biggest gainers from the increase in the income tax threshold and the higher rate threshold will be those earning £43,000 to £121,000 per year. We seem to have a massive redistribution of income here, but it seems to be going the wrong way.

The Government have for five years urged unemployed people to take a job. The sanctions regime has been extremely brutal, but having said that, it is, of course, much better for people to work, if they can, than to remain unemployed. The main justification for the Government’s policy has been that work pays. Yes, and working tax credits achieved that objective. Working tax credits prevented unemployment soaring in the recent recession.

Finally, I repeat that the aim of this amendment is to support the democratic process to enable the elected House to hold the Government to account. That is the duty of this House. If we cannot do that, we might as well not exist.