The Tories don’t want to make work pay. They want to make working families pay

David Cameron doesn't have the first idea how to lead a workers' party

 

Yesterday, David Cameron wrote in The Times that the Conservatives are the party of the workersand that their ‘One Nation mission is restoring the link between hard work and reward’.  Unfortunately, what they are actually doing is precisely the opposite.

At some point in the coming months, ministers will legislate for the tax credit cuts announced in George Osborne’s Budget. The result: over 3 million working families will lose over £1,000 a year on average, and work incentives will be cut. 

Take a couple with three children, and one earner on a salary of £32,000. The household’s income is around £25,000 per year. Tax credit cuts next April mean they will lose £2900 per year. Or a couple with one child, and one person working with an income of £19,000 per year. Their income will fall by £2000. How are these working families supposed to cope with such massive cuts to their income? 

It is absurd to pretend that the Conservative Party is representing working families. David Cameron and George Osborne have no idea what it is like to live on incomes at this level. They never meet people who have to.

The number of people earning less than a Living Wage has risen by 45 per cent since 2009. There has been a 50 per cent rise in housing benefit spending for people in work since 2010.  If David Cameron is serious about ‘restoring the link between hard work and reward’, he has to drop George Osborne’s plan to cut tax credits.  If it goes ahead as announced, the viability of hundreds of thousands of working families will be wrecked.

The Budget also delivered a hammer blow to the faltering Universal Credit project. Iain Duncan Smith announced proudly after the Budget – reflecting bruising pre-Budget negotiations – that the Universal Credit taper rate would not be worsened. He was correct, although the taper rate for tax credits is being greatly worsened. But the work allowances – amounts you can earn before your Universal Credit starts to be reduced – are being drastically cut.

The result will be that people will earn less. Universal Credit was supposed to make sure claimants were better off in work, but the Budget cuts have undermined that before Universal Credit has even properly started.

Government plans to increase the minimum wage are welcome. But they don’t make up for these enormous tax credit cuts. In any case, the tax credit cuts come in next April, while the increase in the national minimum wage will be phased in over five years. 

That is the reason we voted against the Budget.  When the government brings forward legislation to enact these huge cuts to the incomes of working families, we will fight them tooth and nail.

The Tories’ actions are not about making work pay; they are about making working families pay. The Conservative Party doesn’t have the first idea how to be a Workers’ Party. Their history and record in government tell a completely different story.

They are pursuing an ideological attack on workplace representation through their unnecessary Trade Union Bill. They are seeking to tear up the Sunday trading settlement, robbing shop workers and others of precious time with their families, and undermining small businesses. They are attacking the low paid, not low pay. 

The Workers’ Party? No, the party of the narrow, wealthy elite which funds them.

Stephen Timms is shadow minister for employment. Follow him on Twitter

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