Supporting Scotland’s Children

Part of the debate – in the Scottish Parliament at on 4 November 2015.

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Photo of Malcolm Chisholm Malcolm Chisholm Labour

The fact of the matter is that there are fewer people on tax credits now than there were under the Labour Government. I accept that, but Murdo Fraser should have acknowledged that, at this moment—before the cuts—less than 50 per cent of working families are on tax credits. In a way, we have already moved on from Alistair Darling’s comment from a few years ago. Torsten Bell of the Resolution Foundation summed that up perfectly when he said:

“Tax cuts and the living wage cannot compensate for these tax credit changes. That is not an option ... The answer to tax credits is tax credits.”

We also have the massive work disincentive in the changes: the withdrawal rate of 80p in the pound for any extra money earned, and 93p in the pound if people are on housing benefit.

What are we to do if there is no change from the UK Government? At a recent Devolution (Further Powers) Committee meeting, Judith Paterson of the Child Poverty Action Group Scotland said:

“the question to be asked is what will happen if Scotland does not use the powers to top up tax credits ... It has been forecast that, if it does not do that, many more children and families will fall into poverty over the next few years, which would have associated impacts on children’s health, education and prospects.”—[Official Report, Devolution (Further Powers) Committee, 8 October 2015; c 7.]

As we all know, although some of us forget—not me personally—politics is about choices. Today, Labour is making it clear that we are making a different choice from the SNP—certainly in relation to APD—and a different choice from the Conservatives in relation to the higher-rate tax threshold. That might be a different choice from the SNP; it has not told us about that.