LAST week we debated the Welfare Uprating Bill which cuts benefit and tax credit rates for the next three years.
Introducing this divisive piece of legislation the Chancellor tried to pit the working poor against the unemployed, labelling jobseekers as “shirkers” not workers.
But people in work will lose too as 8,500 working families in Wigan will lose tax credits, while at least 3,500 local jobseekers will see their benefits cut.
As the number of part-time and agency workers continues to grow, many people in Wigan move in and out of work on a repeated cycle. To try to divide those in work from those who are not is unfair and wrong.
It will mean that people on Jobseekers Allowance will see their benefits rise by just 71p per week over three years. Food, fuel and other prices will rise much higher than this. At the same time, in April, millionaires will be given a tax cut worth £2,000 per week. How can that possibly be fair?
During the debate ministers laughed as MPs talked of the misery this legislation will cause. At one point I had to ask the Secretary of State to stop laughing as I described what this will mean for people in Wigan.
This Bill fails every test. It is not fair and it will not work. Its consequences will be appalling for the very poorest in society. Wigan’s children will pay the greatest price. As benefits erode more will go to school hungry and more will grow up in poverty.
There are better ways to reduce the benefits bill. Firstly the Government could get serious about job creation.
The best way to cut welfare spending is for people to be employed. Minister should provide wage subsidies, and ensure that we only pay private firms to deliver public services if they provide young people with apprenticeships and give people work and decent training opportunities.
Secondly, the Government should take seriously the impact of low pay on local economies.
The more people there are taking cuts to their tax credits and take-home pay, the fewer people there are spending in local economies. In an area like Wigan, which has a high proportion of small businesses employing many local people, that could prove devastating to the area. Ministers should follow Wigan Council’s lead and bring forward a living wage.