Tax Credits (Working Families)

Jo Cox Excerpts

Tuesday 7th July 2015 Commons Chamber

[Mr Gauke]

I fear that my hon. Friend is right. Given what we inherited, it was necessary to introduce wide, comprehensive reforms to reward work and allow people to fulfil their potential. We have cut taxes. We have capped benefits so that no household earns more in out-of-work benefits than the average household earns by working. We are simplifying the benefits system through the roll-out of universal credit. We tightened the rules to prevent abuse of the system and, perhaps most importantly, we ensured that there were decent, full-time jobs for people to go to. At the same time, we have ensured that benefits continue to help the most vulnerable.

Before I set out how we will continue to help working people to achieve their aspirations, I shall say a few words about tax credits. Tax credits have helped to support many of our most vulnerable families. Over the past five years, we have channelled the support they provide towards the people who need it most—for instance, by increasing the disability element of tax credit in line with the consumer prices index. The next five years will see us continue to roll out universal credit, which will simplify the complex web of benefits and tax credits currently in place.

[Jo Cox (Batley and Spen) (Lab)]

Will the Minister give way?

[Mr Gauke]

Let me make a little progress, then I will give way to the hon. Lady.

Universal credit will replace six working-age benefits—housing benefit, jobseeker’s allowance, income support, employment and support allowance, working tax credit and child tax credit—with a single application process and a uniform taper rate across the UK. It will improve the incentives for people to work. It will target support at those who need it most. It will diminish the opportunities for fraud or simple error and it will make administering the system much more efficient. Universal credit is the most radical transformation of the welfare system we have ever seen, making it simpler, easier and fairer. Once it is fully implemented, it is estimated that it will increase the number of people in work and make households throughout the country better off.

[Jo Cox]

I thank the Minister for giving way. Does he agree with the Resolution Foundation analysis that for a hard-working single parent with one child in my constituency working 16 hours a week on the national minimum wage, if some of the cuts go through she can expect an annual loss of earnings of £1,500, which will take 12 years of incremental 2% pay increases to recoup? What is his plan to help her to get a faster pay rise?

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. This does not apply only to the hon. Lady: when an intervention is made, it should be short and sharp and address one point. It should not be a written script to be read out in the House. I am not addressing these remarks specifically to the hon. Lady. Everybody has been doing that this afternoon. The Front-Bench speeches have therefore taken a very long time, and there are people who have asked to speak this afternoon who will be here all day and will have only two minutes at the end of the debate, whereas people are making interventions and will then leave the Chamber and not take part in the rest of the debate. That is not fair play in this Chamber and we expect better.