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Clause 2 - Personal allowance for 2013-14 for those born after 5 April 1948

Part of Finance (No. 2) Bill – in a Public Bill Committee at 3:45 pm on 23rd April 2013.

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Photo of Chris Evans Chris Evans Labour, Islwyn 3:45 pm, 23rd April 2013

It is a pleasure to serve under your chairmanship, Mr Crausby. We have already heard your wise words this afternoon.

I will try to keep my remarks as close as possible to the clause and the amendments; I will not deviate by following some of the tangents we have seen Government Members follow. It is important to remember when debating a Finance Bill that it is a moot point: the Bill will go through. The granny tax and the personal allowances will go through. There is nothing we can do about that, but what has been wrong in this debate is that the Government seem to think that the Opposition can offer alternatives—anyone with experience of Finance Bills knows that we cannot. It is not the Opposition’s place to do that on Finance Bills, but we can talk about a review.

I turn first to the age-related allowances. As my hon. Friend the Member for Leyton and Wanstead has said, the basic personal allowance for income tax for those aged under 65 will rise to £9,440 and is planned to reach £10,000 by next year’s Budget. The Chancellor, however, has stuck to his plan to freeze age-related tax allowances for people aged between 65 and 74 at £10,500. That is fine. We cannot argue with it—we cannot offer an alternative because of where we are at the moment—but we can ask for a review because pensioners, like children, have been hard hit by this Government. I will move on shortly to address how young people are affected.

I do not want to stand here and score political points, but—[Interruption.] I will try not to score political points, and I will try to stick to the facts of what has been happening. Under this Government, we have seen a cut to the winter fuel allowance of £100 for the over-80s and £50 for those under 80 at a time when fuel bills are rising. Every year, more than 25,000 people die of cold. If anyone wants to score political points on that, let them do so; let them try to show how cold the Government are.

Secondly, a change in the indexation of state and other pensions from the retail prices index to the usually lower consumer prices index will, over time, compound that loss. Thirdly, for the state pension, which for decades has been one of the least adequate in Europe and has resulted in one in four older people living below the official poverty line, that change will see millions more struggle on their income, and still the Government go ahead with their plan.