No other issue is more likely to define this parliamentary term and this coalition Government than welfare and the cost of living. The past four years have been very tough for a great number of people, as I am sure all hon. Members are aware. The living standards of the majority of our constituents have fallen and the value of real wages has dropped, while the cost of living has gone through the roof. Many have lost their jobs or their businesses, but as a result of the Government’s welfare changes—I will not dignify them by calling them reforms—it is toughest of all for those who rely on others and for those who struggle to support themselves even in the best of times.
Once again, the Budget was a missed opportunity to address that and other issues. Instead of taking a step back and examining what could be done to make a tangible difference to the lives of some of the most vulnerable people in our communities, the Chancellor and the Government have decided to draw electoral dividing lines. They could have announced measures to mitigate the worst excesses of their welfare changes, or to help young casualties of the financial crisis back to work, funded by a tax on bank bonuses that would be paid by the very people who nearly gambled away their future. The Chancellor could even have made good on his promise to raise the minimum wage to £7 an hour. Instead, he chose to court the UK Independence party vote with tougher platitudes on welfare and to pave the way for more cuts, while those on his Christmas card list enjoy a tax cut larger in value than the average worker’s wage.
The Chancellor boasted of new private sector jobs, but ignored the fact that many of those are low-paid, part-time, agency or zero-hours contracts, and that some people are living not month to month or even week to week, but literally day to day. The Government must take action now to end the scandal of employment abuse, by restricting zero-hours contracts and promoting the living wage.
Government Members brag of an increase in the personal allowance, but that will be completely swallowed up by inflation, stagnant wages, rising energy and food bills, and previous changes to VAT and in-work benefits. According to the Institute for Fiscal Studies, the actual worth of the increase to those on low incomes will be as little as £2 per week, with one in six workers earning too little to benefit at all. The Government are for ever lecturing that austerity measures are unavoidable and that the rich are paying more than anyone else—as if progressive taxation were created only in 2010.
While my constituents are saddled with the bedroom tax, the shambles of universal credit, and months of delays waiting for personal independence payments, millionaires get massive tax cuts and bankers continue to pocket their grotesque bonuses, now totalling £1.6 billion. If the Government were really on the side of working people they could have raised additional income to help my constituents, by cutting back pension tax relief for people earning more than £150,000 a year to 20%—the
same as for basic rate taxpayers. House of Commons Library estimates state that that would raise between £900 million and £1.3 billion—half the amount that will be lost to the economy through the Government’s welfare changes, snatched from the poorest in society. Even the lower estimates of that revenue would cover the cost of Labour’s compulsory jobs guarantee for young people after its first year of implementation.
The Chancellor could have taken meaningful action to help working people, but the figures behind the Budget neatly illustrate the real legacy of this Government: 350,000 people going to food banks; 400,000 disabled people paying the bedroom tax; and millions of working people worse off by, on average, £1,600 a year. The Government believe that the rich will work harder only if they are made richer, and that the poor will only work at all if they are made poorer. The truth is that, sadly, there is precious little in this Budget for ordinary working people. Once again that shows that the nation is worse off under the Tories, with a Government who are out of touch and do not really care.
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