Taxation (Living Wage)

Debate between Guto Bebb and Catherine McKinnell

Tuesday 22nd January 2013 Westminster Hall

[Catherine McKinnell]

I appreciate the hon. Gentleman’s concern, but I am trying to discuss the premise proposed for debate today by the hon. Member for Harlow, which is people on low pay and the living wage campaign, so I will return to my point on the national minimum wage, which transformed the lives of millions. The policy is now taken for granted, but it was implemented in the face of often strident opposition, in particular by members of the Conservative party. Despite significant opposition at the time, however, it now seems to be universally accepted as an important aspect of our economy in ensuring fairness across the board.

The squeeze on people’s incomes and the ever-increasing cost of living, of which we are all aware and which we have all seen among our constituents, mean that for many the national minimum wage is simply not enough to make ends meet. Thus, a higher rate of £7.45 per hour outside London and £8.55 per hour inside the capital has been calculated by the Centre for Research in Social Policy as the level required to enable people to provide for themselves and their families.

[Guto Bebb]

On the minimum wage, although I was not in this place for the debates, my recollection is that the issue was about the scale and level of the minimum wage. My real concern was that the state was imposing a minimum wage on small businesses but also helping itself to tax from that minimum wage. Surely it is a good thing that the coalition is ensuring that people on the minimum wage are now paying significantly less tax.

[Catherine McKinnell]

Could the hon. Gentleman repeat his premise about how the Government are helping people on the minimum wage to pay less tax?

[Guto Bebb]

The point is simple. The Labour Government brought in a minimum wage, and yet the Government of the day helped themselves to significant amounts of tax from that minimum wage. In other words, small businesses in constituencies such as mine felt that they were being forced to pay higher levels of wages in order for the Government to be able to help themselves to tax. Surely this Government, by increasing the personal allowance so significantly, have reduced the tax take from those on the minimum wage.

[Catherine McKinnell]

I accept that the Government have increased the personal allowance, but their other policy changes have impacted on those very people whom they purport to be helping, with a real-terms effect on families up and down the country. In fact, the hon. Member for Cleethorpes admitted that his constituents are certainly not happy about some of the changes and their impact. I know for certain that my constituents would agree, but the shocking fact is that almost 5 million people across the UK are currently paid less than the living wage, and 3 million of them are women. The Government may believe that the way to motivate people on low incomes is to pay them less, and the way to motivate those on the highest incomes is to pay them more, but the Labour party believes that this is an issue of dignity at work and social justice.

Transferable Tax Allowances

Debate between Guto Bebb and Catherine McKinnell

Wednesday 28th November 2012 Westminster Hall

[Catherine McKinnell]

What is rather counter-intuitive about the arguments being put forward today is that this tax incentive, small though it is, would be targeted at the very families that are not in dire straits. Members seem to be turning their backs on children in families that are facing the difficulties they have described. Unmarried couples, including those with children, have lost out on tax credits—many have had their tax credits cut because they cannot find more hours of work—or have been hit with housing benefit cuts, but they will not benefit from these changes. If a marriage ends for circumstances entirely out of somebody’s control, or if they are widowed or have to flee the marriage because of violence, they will lose the proposed benefit, but it could still be available to the perpetrator of the domestic violence, who could get married again. Nor would this benefit be available to married couples where both partners are working, unemployed or low earners.

Hon. Members have mentioned analysis by the Institute for Fiscal Studies, but that analysis shows that this benefit will be available to only 32% of married couples. This policy is meant to recognise marriage in the tax system and to send an important signal that we value couples and the commitment people make when they are married. Do Members believe that only 32% of marriages should be valued, while the other 68% are of less value and less worthy?

[Guto Bebb]

Will the hon. Lady give way?

[Catherine McKinnell]

Unfortunately, I do not have much time. I appreciate this is an important subject, and I would like to give Members more time, but I want to finish my comments.

I strongly disagree with the hon. Member for Enfield, Southgate, who attempted to dismiss out of hand any notion that this policy recognises not marriage in general but just one type of marriage, where one partner is the breadwinner and the other stays at home. He dismissed the Deputy Prime Minister’s comments that such things are a throwback to the Edwardian era, but that is a sincere concern for many people.

I appreciate the comments of the hon. Member for Strangford (Jim Shannon) and the sincere manner in which he made them, but I disagree with him. Designing the system in a way that penalises all couples and families that do not fit in with one specific model, regardless of need, sends out a strong signal—intentionally, it would seem—that one type of family is worth more than another and that one type of parent is worth less than another. That is a very dangerous signal to send to children. It is unfair and out of touch, and is not the best way to support families in the tough times of 2012.

Public Sector Funding

Debate between Guto Bebb and Catherine McKinnell

Wednesday 23rd March 2011 Westminster Hall

[Catherine McKinnell (Newcastle upon Tyne North) (Lab)]

I congratulate my hon. Friend the Member for Worsley and Eccles South (Barbara Keeley) on securing this important debate. It has been very instructive to listen to the contributions made from both sides of the Chamber.

People in Newcastle are concerned about the speed with which the local authority cuts have been imposed and about the impact that that has had on the voluntary sector and support for it. Newcastle is one of the cities that has a thriving citizens advice bureau service, and it served more than 26,000 people last year, but it has now received a 20% salami-sliced funding cut, which is one of the worst cuts to services in the country.

The issue remains very much the speed with which the cuts have been imposed on local authorities, as well as their impact on different regions, particularly urban areas, where cuts to funding to combat deprivation have had a disproportionate impact—for example, in cities such as Newcastle upon Tyne.

[Guto Bebb (Aberconwy) (Con)]

Clearly, all Members in the Chamber share the view that the volunteering sector is important, but while listening to Opposition Members’ contributions I had the strong feeling that we have created an over-dependence on the public sector for volunteering organisations’ funding in the past 10 years. That over-dependence is as much about creating a big state as it is about creating a big society.

Does the hon. Lady agree that many of the best organisations working with local communities—certainly in constituencies such as mine—are free from Government intervention and Government funding? The point has been strongly made that there are bureaucratic issues in volunteering when organisations depend on Government funding. We need to create a society in which people volunteer, but do not depend on Government funding to do so.

[Catherine McKinnell]

I do not agree with the hon. Gentleman’s assertion. I agree that there are some fantastic voluntary organisations that do not rely on any public funding. They are supported, and have to be supported, across the country, and they are warmly welcomed. However, one of the main issues is that the abilities of those organisations are not necessarily distributed in such as way as to target the most hard-to-reach areas, which require more structured funding to support and assist voluntary activities. That point has been made very clearly by my hon. Friends and, indeed, by Government Members.