Welfare Cap
Debate between Marie Rimmer and Chloe Smith(8 years, 11 months ago)
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Marie Rimmer
Sit down! I am sorry, Madam Deputy Speaker.
We always know when the Government are at their weakest, because they go on and on about the financial crisis. But let us get to the welfare cap. Of the two major cuts to in-work support in the summer Budget—to tax credits and its replacement, universal credit—only the tax credits element has been reversed. The reason we are in this state is that the Chancellor originally set the cap at a level that, in the first instance, simply tracked the Office for Budget Responsibility’s projections for spending on those benefits and tax credits that were in scope—as one of my colleagues mentioned, tax credits are in scope, which is unacceptable. The cap started in 2015-16 and extends for the next five years, meaning that, for now, the cap has no policy effect whatsoever. The Government are simply committed to operating future policy on the basis of not overshooting the current estimate of financial spending over the coming years. We could be in this position next year and the year after, because there are no real policy decisions. It is short term. It is nothing else.
As predicted, that led to the announcement of emergency cuts, including those to tax credits, but they were resoundingly kicked out by the Lords—the Conservatives at prayer, as someone described them. Although I am not in favour of an unelected second Chamber, I applaud them for taking that action. Only the tax credits element was reversed, however, and working families remain on the front line of further assaults, such as the cap and the universal credit cuts. The latter will affect many people—more than 200,000, I think—from April 2016, and the majority of those on universal credit are in the north-west. They are the ones who suffer the most from unemployment and financial deprivation—much of which is caused by zero-hours contracts, insecure employment, low pay and part-time work—which is why they are on benefits.
