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Friday, 31 July 2015

Harriet Harman tells David Cameron to halt his back-door plans to cut tax credits

The Labour Leader, Harriet Harman, has written to Prime Minister, David Cameron, calling on the government to bring forward primary legislation on the substantial planned changes in tax credits. At the moment tax credit changes costing working families £1,000 a year could be imposed with the scantest possible parliamentary scrutiny, through a Statutory Instrument which will not be debated by the whole House of Commons. Labour is calling for changes to tax credits to be first examined by the Treasury Select Committee and thereafter included in primary legislation.

The full text of the letter is below:
Dear Prime Minister,
You have proposed substantial measures to cut tax credit work allowances which the IFS say will cost 3 million families an average of £1,000 a year each – a total cut of £3.4 billion.
The cuts in tax credits of £3.4 billion were not in your manifesto. During the election campaign you gave no indication that your government had plans to do this. Indeed on 30 April 2015, in response to a question on whether you would cut Child Tax Credit, you said: “No I don’t want to do that”.
This is a controversial measure. You assert that working people will be compensated for the cuts to tax credits by the increases in the minimum wage. This is contested by the IFS who say that it is “arithmetically impossible”.
It appears that you are proposing to implement your cuts to tax credits with the scantest possible parliamentary scrutiny, through a Statutory Instrument which will not be debated by the whole House of Commons. It will only be considered by a committee of no more than 15 MPs and is likely to be concluded in no more than 45 minutes. It will not be possible to amend it in the House of Lords.
Parliament needs to be able to scrutinise this measure which was not in your manifesto, and is substantial and highly controversial, and which we oppose. These cuts to tax credits hit working families in every constituency, and must not be sneaked through the back door without the chance for MPs to subject them to proper scrutiny.
I am writing to ask you to undertake that this is not implemented by way of a Statutory Instrument. I propose that it is first examined by the Work and Pensions and Treasury Select Committees, who can take evidence on the extent to which the cuts to tax credits will hit working families and the inaccuracy of your claim that those who lose out will be compensated by a higher minimum wage.
Thereafter, if you persist in taking these measures forward, I propose that you do so in primary legislation which can be considered at a Second Reading on the floor of the House of Commons, then in a full Committee Stage, then again by the whole House of Commons at a Report Stage and Third Reading, and then by the House of Lords.
I look forward to hearing from you.
Yours sincerely,

Harriet Harman