I thought that I would use my time in this debate to speak about the real victims of last week’s Budget: children in this country who have suffered because of the savage blows that have been imposed on their services and the support structure that we provide for them. This savage attack is twofold. First, child benefit has been frozen for the next four years, not taking into account the rising cost of living. Secondly, child tax credit is now going to be restricted to families with no more than two children. Have the Government thought long and hard about what impact these changes will have on disabled children living in families, on single mothers, and on families with low and modest incomes?
My problem with these changes is that they will in no way address the deep-rooted problems that we have in our low-wage, low-productivity economy, with the huge
discrepancy between the very well-paid and the very poor. These changes will not deal with the problems that we face in the economy.
There is little recognition of how much tax credits have contributed to alleviating child poverty. By the end of the last Labour Government, the proportion of children living in families below the poverty line had fallen from 35% to 19%. It is the Labour Government who can claim credit for lifting more than 1 million children out of relative poverty. Those are things that we are proud of.
The Tories use rhetoric that speaks of tax credits encouraging workshy people, says that people are lazy because they claim tax credits and uses that dreadful word, “scroungers” for people who abuse the welfare state. Well, guess what? The majority of people who claim tax credits are in work. The Government need to realise that. The IFS has pointed out that reducing tax credits weakens the incentives for people to work. At every turn, the Government’s rhetoric on tax credits is wrong. The single largest revenue raiser in last week’s Budget was the scaling back of tax credits, which almost exclusively hits people who are in work.
The Social Mobility and Child Poverty Commission has said that relative and absolute child poverty will increase in the next decade. Given that those figures are about to be released, is it surprising that the Government have said that they will scrap the legally binding child poverty reduction target and are busy trying to redefine poverty?
Ministers do not need to spend time redefining poverty. Instead, they should take the 15 minutes that it takes to leave Parliament and go to my constituency of Hampstead and Kilburn. They should go around the estates of south Kilburn—the most deprived parts of my constituency—and see the families giving up their dignity to queue up for food banks. In winter, those families have to make the choice between eating and putting the heating on. Those are the families who go to work, but for whom work does not pay because we live in a low-wage economy. Those are the things that we have to assess before we make these dramatic changes.
Before we rush through this Budget, which will be damaging to my constituents and constituents across the length and breadth of this country, I ask the Government to consider two things. First, they should think about the impact that the changes to working tax credit and child tax credit will have on women. Child tax credit is claimed more by women, because the main carer in the family tends to be a woman. Working tax credit is needed by women more because there are more women in low-paid jobs, as was demonstrated by the recent debate on equal gender pay in Parliament. Bearing that in mind, they should think carefully about whether they are doing something that takes away the economic empowerment of women in our country. Will the changes mean that women do not feel empowered to go out and work? They must think carefully before making those changes.
Lastly, the Government should think about the impact that restricting child tax credit will have on families with more than two disabled children. At the moment, there is a top-up on child tax credit of £3,000 if families have a disabled child and up to £4,000 if they have a severely disabled child. What will happen to families who have
three severely disabled children? What will happen to families who have two severely disabled children and one child who is defined as disabled? We need to think carefully before we rush the Budget through.
My plea to the Government is that they go back to the drawing board, listen to what Opposition Members have been saying and think about the effects that the Budget will have on women and disabled children across the country, and on families who want to work, but who cannot get the right wages from that work.
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