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Tuesday, 8 January 2013

Labour and the Tories clash over the 1% benefits cap

This morning, the Conservatives launched a poster campaign to coincide with a vote on a proposed 1% benefit cap that's happening in Parliament later today. The Labour party have said they will vote against the bill which caps benefits at 1% for the next 3 years. 

The Work and Pensions Secretary Iain Duncan Smith has called Labour's position "a double blow to the taxpayer who has to foot the bill." claiming that :"Under Labour, our welfare system spiralled out of control with the welfare bill rising by 60%, costing every household in Britain an extra £3000 a year." and "In the last 5 years, those on out of work benefits have seen their incomes rise almost twice as fast as people in work - at a rate of 20% compared to an increase in average earnings of only 12%."

Mr Duncan Smith continued by saying: "Labour vote time and again against everything this government is doing to get welfare spending under control. But they don't say how they would pay for all this. By voting against our measures, Labour's Ed Balls would clearly be happy with more borrowing to pay the welfare bill - this would saddle every working household in the UK with almost £5000 of extra national debt. It's clear Labour has learnt nothing. Labour's plan is to spend more, borrow more and tax more.Where's the fairness in that? Our plan is clear - to deliver stability to the public finances and return fairness to welfare."

Labour’s Shadow Work and Pensions Secretary, Liam Byrne MP, said: “It’s now clear. There's a Labour way to bring down the welfare bill and a Tory way. The Tory way is to hijack support for working people. The Labour way is to help people work. “The Tories and their Lib Dem friends have delivered a flatling economy and rising long term unemployment which has put up the welfare bill by over £13 billion more than planned. And now they want working people to pay the bill with a strivers tax that will hit 7 million families. Yet they're happy to give a £107,000 tax cut to 8,000 millionaires."

Mr Byrne continued: "This Bill does nothing to create a single new job, fix the chaos in Universal Credit or the Work Programme which has been an utter failure. So we'll be asking MPs to vote for real welfare reform, a compulsory Jobs Guarantee that will end life on welfare for the first time.”

TUC General Secretary Frances O'Grady waded into the row by saying: "Ministers think that the benefits up-rating cap will bring them a political dividend that is as effective at delivering votes as it is in reducing the living standards of millions of people on low to middle incomes. But as a TUC YouGov poll shows, support for the measure depends on voter ignorance. Those with the most inaccurate view of the current system are the most likely to support change. Those who know the most are more likely to oppose the cap."

"But people's support for a cap on benefits for the jobless is based on the myth that they are generous. Indeed the long term value of benefits for the jobless has fallen. If a single person's Jobseekers' Allowance was at the same share of average earnings today as it was when Mrs Thatcher left office it would be worth £86 a week - over a fifth more than the amount today's jobless get (£71). Hardly anyone in work today can say that they and every member of their family could not lose their job. That's why we need a proper unemployment benefit as part of our national insurance system. We all pay in so that we can get very modest support if the worst