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Tax Credits

Part of Opposition Day — [7th Allotted Day] – in the House of Commons at 4:40 pm on 20th October 2015.

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Photo of Graham Evans Graham Evans Conservative, Weaver Vale 4:40 pm, 20th October 2015

The hon. Gentleman is saying that the Scottish National party is happy to increase the national debt. That is the message: the national debt is going to go up. That is what socialism does and what socialists say. They are not concerned about the national debt, which is currently £1.4 trillion and getting higher. We can hear the message coming through loud and clear from the SNP.

Tax credits cost £l billion in their first full year, but have since risen to an estimated £30 billion over the last year, yet over the same period in-work poverty rose by 20%. The status quo on tax credits is clearly not working. Indeed, the former Labour Chancellor of the Exchequer, Alistair Darling, said that tax credits were

“subsiding low wages in a way that was never intended.”

It is vital to address the root causes of low pay rather than simply continuing endlessly to subsidise low pay through the benefit system. Reforming tax credits is crucial to achieving a sustainable welfare system that is fair both to the most vulnerable in society and to hard-working taxpayers who have to pay for it.

These reforms do not stand in isolation, but are part of a joined-up, wider offer to working people by this Government. With the announcement of the introduction of a new living wage by my right hon. Friend the Chancellor during his summer Budget, and the strides taken to raise the personal allowance, people will be not only earn more but keep more of what they earn. It always pays to work.

On top of that, we doubled the number of free childcare hours of which parents can take advantage to 30 hours, introduced tax-free childcare and froze fuel duty, saving a family £10 every time they fill up their tank.