Finance Bill

Debate between Maria Caulfield and Carol Monaghan

Tuesday 21st July 2015 Commons Chamber

[Maria Caulfield]

I wish the hon. Gentleman a very happy birthday. I take his point, but what has been missed from the argument is the raising of tax thresholds that will benefit people, especially those on the lowest wages. I shall come to that in a minute.

The Bill will make important differences to ordinary families. First, it will reduce personal taxation. During the last decade, under the Labour Government, more than 1.6 million people were dragged into the higher rate of tax, including hundreds of thousands of nurses, teachers, police officers, and other public sector workers. Our measures to raise the higher-rate threshold to £43,000 will make a difference to those people and their families. All in all, a basic rate taxpayer will be £905 a year better off. The families who will benefit from those changes are not wealthy; many of them work long hours and commute long distances, and deserve to keep more of the money that they earn.

The Opposition parties believe that the way to reward hard work is not to increase wages or reduce the tax that people pay, but to increase benefits in the form of tax credits. That is what Labour did in government, to such an extent that the welfare bill rocketed, accounting for about a quarter of all public spending. That meant that there was less money for our hospitals, our schools and our infrastructure.

Why are Opposition Members so adamant that the only way to improve people’s lives is to increase their benefits? I will tell you why: because they do not believe in aspiration. They do not believe in the fundamental principle that if people work hard enough, no matter what their background, they can achieve anything in life. A life on benefits is not inevitable, nor should it be the only way forward for working families. Conservative Members support workers by not only increasing the national living wage, which I cannot believe Opposition Members actually—

[Carol Monaghan]

Does the hon. Lady not accept that using language such as “national living wage” is sinister mischief-making? It is also hugely disrespectful to the Living Wage Foundation, which has set the living wage at £9.15 in London and £7.85 outside.

[Maria Caulfield]

I disagree. By 2020, the living wage will be £9, because that is the level at which we have set it. For the lowest-paid workers in the country, that has to be a huge advantage. I cannot believe that Opposition Members are actually disagreeing with a proposal to increase the wages of the lowest earners.