Tax Credits (Working Families)

Debate between Lyn Brown and David Gauke

Tuesday 7th July 2015 Commons Chamber

[Mr Gauke]

The hon. Lady quotes the IMF, but this is the same IMF that has praised this Government’s record in turning round the economy. The head of the IMF said that she shuddered to think what would have happened had we not got to grips with the deficit. The reality is that if we want to help every part of society, which is what this Government want to do, we need to make sure that we have a strong economy, and that is what this Government are delivering.

[Lyn Brown]

The Minister says that a strong economy is what this Government are delivering, but the International Labour Organisation has said that between 2010 and 2013 the UK had the biggest drop in real wages of all countries in the G20. How does he square that?

[Mr Gauke]

In 2014, the UK was the fastest-growing economy in the G7 and it looks likely that that will also be the case in 2015. [Interruption.] The hon. Lady talks about wages, but they are up 2.7% in the last year. As I said, living standards have risen by 3.9% on the year, despite the fact that we are still living with the consequences of the deepest crash and the biggest deficit, which we inherited from the Labour party.

Income Tax

Debate between Lyn Brown and David Gauke

Wednesday 28th November 2012 Commons Chamber

[Mr Gauke]

My hon. Friend sets out some dramatic numbers. They are the correct numbers, although it would be right to say that an element of that had to do with forestalling and people moving their income around. However, Opposition Members should not take great comfort from that. They demonstrate the enormous amount of behavioural change as a consequence of high rates. That level of forestalling is striking. What is also striking is that when the previous Government made their estimate of what would happen with income, no allowance was made for forestalling whatsoever, which again demonstrates flaws with the methodology that was in place.

[Lyn Brown (West Ham) (Lab)]

The hon. Gentleman makes an erudite argument, as always, and he sounds plausible, but can he not see that ordinary families, who are losing at least £500 per year, facing difficulties buying food and struggling with petrol costs, find it really hard to stomach why the Government are choosing to give £107,000 per year to people who are earning £1 million? It does not make sense to them. It does not make sense to us.

[Mr Gauke]

In the Office for Budget Responsibility assessment there is a tax cut of £100 million that goes to those who are paying the 50p rate.

In the same Budget package, however, there are measures to deal with stamp duty avoidance on properties over £2 million, a stamp duty increase on properties over £2 million, which is bringing in revenue, and caps on reliefs directed at high-earning individuals. So who is paying the stamp duty and not benefiting from the reliefs as before? They are high-earning individuals. They are paying for the cut in the 50p rate five times over as a consequence of the measures announced in the last Budget. That is the explanation to the hon. Lady’s constituents, and mine, of how the cut is being funded.