Welfare Cap

Debate between Ian Lavery and Owen Smith

Wednesday 16th December 2015 Commons Chamber

[Owen Smith]

I know, okay, the Chancellor: the right hon. Member for Tatton (Mr Osborne), in Cheshire—the Cheshire cat—and given that he is rather like Macavity, rather than the Cheshire cat, I thought that I would give the House a treat. I read that there were no Etonians on the Front Bench among the new intake, and I was worried that the lack of classical education from which the Treasury Bench normally benefits might mean that the Macavity reference went over Ministers’ heads, so I brought a little book with me, and I shall read a section from it. [Interruption.] It is not Mao; it is T.S. Eliot’s collected poems. It gives us Macavity the mystery cat, who is, of course, the Chancellor:

there’s no one like Macavity…

he’s very tall and thin;

You would know him if you saw him, for his eyes are sunken in—

I think that is the 5:2 diet—

He’s outwardly respectable

although

(They say he cheats at cards.)—

I bet he does—

And when the larder’s looted, or the jewel-case is rifled…

He always has an alibi, and one or two to spare:

At whatever time the deed took place—MACAVITY WASN’T THERE!

Macavity is not here today, is he? And the deed that he is ducking, of course, is this embarrassing, humiliating U-turn. The cap has been breached, and the Government have done it, of course, because of the spectacular, screeching U-turn on tax credits.

[Ian Lavery]

If my hon. Friend—he is a really good friend of mine—had done what the Chancellor has done in promising that the welfare cap would not be breached, would he have sat there and done nothing? I am sure that he would have been prepared to stand at the Dispatch Box, have the courage of his convictions and perhaps apologise.

[Owen Smith]

I would have been mortified had I been the Chancellor responsible for such a terrible U-turn and such an extraordinary, humiliating, screeching U-turn.

Welfare Reform and Work Bill

Debate between Ian Lavery and Owen Smith

Tuesday 27th October 2015 Commons Chamber

[Owen Smith]

Indeed they should. I cannot understand how on earth even this Chancellor, who is pretty slipshod on occasion when it comes to analysing the impact of his measures, can have allowed this one to slip through the net. A pasty tax and a caravan tax maybe, but a £4.4 billion hit on the very workers he purports to support is truly extraordinary.

Let us look beyond the statistics for a moment. On Friday, I was out in my constituency in the village of Beddau, a former pit village at the heart of Pontypridd. Entirely by chance, I met a young woman called Kirsten who was bringing her daughter Maisie home from school. Kirsten is a nursery manager in a small private-run nursery just outside the village. She works 21 hours a week. They are all the hours available, as the nursery is open only in the morning and she works all five mornings. She then brings her daughter home from school and looks after her. She earns £611 a month. That is what she earns from her 21 hours of work at £8 an hour. That is well above the minimum wage and well above the new minimum wage we will see next year. She is set to lose £1,300 of her £7,000 earnings as a result of the cuts. That is an enormous drop for her to contemplate. She said to me that she simply did not know how she would manage. She did not understand how, without the £128 she receives in tax credits each month, she will be able to make ends meet.

I sat down with Kirsten and talked through what she needs to pay out for each month: the housing association three-bedroom house she lives in, council tax, insurance, and running her car to get back and forth to the nursery and to pick up her child. There is nothing left over. The £128 she spends from the tax credits she rightly receives pays for food, new clothes and her child’s books for school. It is just beyond the ken of ordinary people that the Government could be asking them to pay the price for the bankers’ recession, which has led to the crisis in our economy and a Tory Government cutting the incomes of working people.

[Ian Lavery (Wansbeck) (Lab)]

Does my hon. Friend agree, when the issue of family tax credits is all boiled down and the arguments have been fine-tuned, that this is simply an ideological attack by the Government on the lowest paid in our communities? Does he agree with the Institute for Fiscal Studies, which says that low-paid people are being specifically targeted?

[Owen Smith]

I completely agree. It is extraordinary for the Government to describe tax credits as “a bribe”. That is how successive Ministers, including the missing Secretary of State for Work and Pensions, have gone out of their way to describe tax credits for working people. They do not talk about protecting pensioners’ benefits as a bribe by the Conservative party to pensioners—and I would never say that; it is entirely just to protect pensioners’ benefits. By describing tax credits as a bribe, they are even seeking to demonise working people on low and middle incomes who are doing the right thing. That is entirely wrong.

--- Later in debate ---

[Owen Smith]

The hon. Gentleman could, of course, start by deciding not to do what the Government did this week when they offered an inheritance tax cut for properties worth more than £1 million. That would provide about £1 billion. He could decide to reverse the 50p tax rate cut for millionaires; that would provide another £3 billion. He could choose to do what the Chancellor has already chosen to do in the past, and delay the point at which the Government get the budget into surplus. He has moved the goalposts once; why does he not do it again? He is very good at it. He has practised. He has already had one crack at it.

[Ian Lavery]

My hon. Friend has been asked numerous times what the Labour party would do about the £4.2 billion. Will he now explain, categorically and in the simplest terms, that we would not do what the Government are doing, which is taking £4.2 billion from the lowest paid in society? People are losing £1,300 a year, and 200,000 kids are being pushed into poverty. That is not what we are going to do.

[Owen Smith]

I am delighted to say that I agree 100% with my hon. Friend. Let me be really clear: our view today is that the Government should repeal these measures. Our view is that it is wrong to seek to balance the books, in this or any country, on the back of the working poor—those with low and middle incomes who are doing the right thing. This is the wrong thing to do, and we will not do it.

Let me end by reflecting a little on what this whole unedifying spectacle means for the public, and to the public. I think we can agree that politics has been held in pretty low esteem in this country in recent years. People feel that we, as a political class, are not straight with them. They feel that we do not keep our word, or say what we mean.