Amendment of the Law

Debate between Ed Balls and Baroness Bray of Coln

Thursday 22nd March 2012 Commons Chamber

[Ed Balls]

I think we should leave people’s trust funds out of this. I will come back to that in a moment, but I will not press the Government on it.

The Chancellor took a reckless gamble on jobs and the economy, the Prime Minister and the Chancellor have taken a reckless gamble on NHS reform and police cuts, and now the Chancellor is taking a reckless gamble with the fairness of our tax system by handing out massive tax cuts to legitimate taxpayers in the hope—based on no evidence—that the cuts will pay for themselves by somehow bringing all the tax avoiders back into the fold. That is a fact.

[Angie Bray (Ealing Central and Acton) (Con)]

Will the right hon. Gentleman confirm that under the previous Labour Government the 50p tax rate applied for just 37 miserable days and that for the rest of the time their tax on the highest income earners was lower than under the coalition Government?

[Ed Balls]

In reply, let me quote what the Chancellor said in October 2010:

“The public must know that the burden is being fairly shared. That's why I said last year: we are all in this together. And I am clear…that those with the most, need to pay more. That is why… I have stuck with the 50p tax”—

the Chancellor of the Exchequer, Conservative party conference, October 2010. Eighteen months on, what has changed? The public still want the burden to be fairly shared, but far from keeping the top rate of tax, he is ditching it.

Let me read another quote. In October 2009, the Chancellor said:

“we could not even think of abolishing the 50p rate on the rich while at the same time I am asking many of our public sector workers to accept a pay freeze to protect their jobs. I think we can all agree that would be grossly unfair.”

We can all agree on that. What has changed? What is the truth? It was all a con. The mask has slipped. To 200,000 families struggling on less than £17,000 a year, he says, “I’m going to cut your tax credits to make you work harder”, but to the highest earners, he says, “I’m going to cut your taxes because if I don’t, you won’t work hard and pay your taxes.” That is it. To make the poor work harder, the Chancellor makes them poorer. To make the rich work harder, he makes them richer. Does that not tell us everything we need to know about the Chancellor? He is cutting tax credits for the poor, cutting child benefit in the middle, cutting tax help for pensioners and cutting taxes at the top. That is his priority.