Welfare Spending

Kanishka Narayan Excerpts

Tuesday 15th July 2025 Commons Chamber

[Danny Kruger]

The difference is that child benefit is paid to everybody. Child benefit is a universal entitlement. We need to ensure that we are not adding to the incentives in the system to live a life on benefits. I fully recognise the point that the hon. Gentleman makes.

When I say that some people receive more from the system than they pay in, I am not trying to stigmatise those people. That point has been thrown at us, but it is not the case. I am not stigmatising people who receive more in benefits than they pay in tax. Life is not all about whether someone is a net fiscal contributor or not. I agree with points made by some Members that we should think more about social structures than fiscal transfers, but when it comes to fiscal policy there is a limit. Reciprocity matters, and when we are talking about money, it is right that people living on benefits face something of the same realities as people who pay for themselves.

We still have too many families trapped in welfare. What we need is more families and, yes, larger families supporting themselves through well-paid work. We need a tax system like that in Europe, America and across the world, which recognises families. The previous Government made an important step with the changes to the high-income child benefit charge, which was scrapped by Labour. The best thing we can do for families is to get the tax system and, crucially, the wider economy right, so that we have good growth, good jobs, higher wages, flexible childcare and strong communities.

[Kanishka Narayan (Vale of Glamorgan) (Lab)]

The shadow Minister talks about trade-offs in public finances, growth and child poverty. In the period since 2015-16, there was zero progress on absolute poverty and zero progress on relative poverty—public finances ruined and growth flat. Does he not think that the central trade-off was between a Tory Government and a thriving country?

[Danny Kruger]

The story of the last 14 years is quite easily told. In 2010 there was a budget deficit of 9%, and we had almost fiscal bankruptcy. We spent 10 years very painfully restoring the public finances at great cost, and I totally understand that. Then we were back down to a balanced budget. Then covid hit, and we spent the last five years trying to recover from that. On welfare, we have a very proud record of reducing unemployment and making work pay. Since covid we now have this great problem of disability and sickness benefits. That is the challenge that we were undertaking to fix as we left office and that the Government have now completely failed to conclude.

It is not too late. I am glad to see the Minister for Social Security and Disability in his place. His review should not wait until next autumn; we need it this autumn. We need proper plans to fix the welfare system, not just to increase spending as the Government are now doing. I urge hon. Members across the House to support our motion. Let me be clear: every Member who does not is voting for welfare dependency and national bankruptcy. Only the Conservatives have a plan to fix this.