Welfare Cap — House of Commons, 2015-12-16
Topic: Social Welfare
Owen Smith (Labour, Centre-left): I think that is precisely the case. My right hon. Friend is right. There are currently around 140,000 recipients of tax credits, not all of whom get the work component; we do not know that precise number—it may be around 40,000. There are predicted to be 500,000 people, on the Government’s own numbers, in that circumstance by next April. When I put it to the Secretary of State at Work and Pensions questions last week that those people would lose out precisely as my right hon. Friend suggested, he said that the flexible support grant would more than make up for those losses I have looked at the flexible support grant and, as far as I can see, it is a £69 million grant that is available to local Jobcentre Plus managers to help people who are close to the workplace, perhaps for a new suit or a ticket to get on the bus to the interview. Even if it were permissible to use the money in that way, £69 million would in no way make up for the £100 million shortfall next year, the £1.2 billion shortfall the year after, and certainly not the £3.2 billion shortfall in 2020. It is impossible, and I fear it is also misleading for the public I will bet a pound to a penny that the Secretary of State and the Chancellor did not also mention that offsetting the cuts to universal credit will hit precisely the same Tory and Labour constituents just before the next election, in 2019-20. I would also wager that they still do not appreciate that the Chancellor cannot U-turn on this issue. The reverse-ferret is not available any longer, because if he does not make good his promise to make those cuts to universal credit, he will not be able to keep the promise that the Minister just made again on maintaining the welfare cap in 2020, and he will certainly not be able to deliver his other promise of a £10 billion budget surplus in the same year Perhaps the lesson we should all take from today’s U-turn on the welfare cap, snuck in shamefacedly at the fag end of the Parliament, is that no one should take this Chancellor’s traps and tricks, his games and gimmicks, terribly seriously any more. He can meet them or breach them—he does not mind which, because what he is really about is not sound management of the public finances but the political games of public schoolboys. That is why he cut universal credit seven times before it had even started, making a mockery of any claims to make work pay or support for the low-paid. That is why he continues with his fantastical claims, repeated by the Minister, that welfare spending is under control, even as the housing benefit bill went up by £30 billion in the previous Parliament, and even as Ministers breached £1 trillion on welfare spending for the first time We will back the Government in voting to secure Labour’s demand to reverse the tax credit cuts, and we will continue to press them for the same reversal for the victims of universal credit. But we should not pay too much attention to the Chancellor’s tricks and traps in future, because his flagrant breach of the welfare cap, deemed so essential just a few months ago, has exposed the true extent of his stunts. The welfare trap has caught him. Eliot’s detectives could not catch Macavity, but he has been rumbled.