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Corbyn challenges Cameron over Tory MP Heidi Allen's tax credits criticism

Published 21/10/2015

Conservative MP Heidi Allen, who used her maiden Commons speech to warn George Osborne that cuts to tax credits are
Conservative MP Heidi Allen, who used her maiden Commons speech to warn George Osborne that cuts to tax credits are "too hard and too fast".

Jeremy Corbyn has challenged David Cameron to explain where one of his backbenchers is wrong when she insists controversial cuts to tax credits are too harsh.

The Labour leader quoted Heidi Allen, who attacked the £4.4 billion cut to tax credits during an opposition day debate with a protest that "too many people will be adversely affected".

Answering at Prime Minister's Questions, Mr Cameron insisted the cuts to tax credits were part of a wider package of reforms that would see working people better off.

South Cambridgeshire MP Ms Allen was one of a series of Tory MPs who ramped up pressure on Chancellor George Osborne to U-turn on the cuts during Labour's opposition day debate.

Returning to the issue for the second week running, Mr Corbyn joked Mr Cameron would "absolutely welcome" his questions on tax credits.

After extensively quoting Ms Allen, including a plea that "something must give", the Labour leader said: "Where was she wrong?"

Mr Cameron replied: "The tax credit changes are part of a package, a package that includes a higher national living wage and tax reductions.

"I think that is the right approach for our country - let's make work pay, let's allow people to earn more, let's cut their taxes and let's make welfare affordable."

He added: "I'm delighted that once again this measure passed the House of Commons last night with a big majority."

Labour's opposition motion was beaten by a majority of 22. The statutory instrument implementing the changes was passed by MPs last month - but is set to be bitterly opposed by peers next week.

Mr Corbyn continued with his practice of asking questions from the public, quoting Lisette as asking: "A lot of people are setting up their own businesses as self-employed, especially in rural areas where job vacancies are limited and pay is often low. Tax credits help them until their business becomes established."

Mr Corbyn continued: "Cutting tax credits damages her life opportunities and the life opportunities they might employ - do you not see the value of giving support to people trying to improve their lives rather than cutting their ability to survive properly?"

Mr Cameron replied: "Of course we want to help the self-employed on low incomes."

Mr Cameron said those on the lowest incomes keep child tax credit at £2,730 and outlined policies for small businesses - including cuts to income tax and the employment allowance to reduce National Insurance bills.

He added: "Above all what we are doing is creating an economy with two million more people in work, an economy that is growing, wages that are rising and inflation that is at zero.

"All these questions on tax credits in a way come back to the same point which is how you build a strong and secure economy. You don't do it on the back of a massive deficit and an ever increasing debt which is what Labour left us with."

Mr Corbyn said it was all "very strange" and accused Mr Cameron of having "changed his mind" since before the election.

Quoting John, he recalled the Prime Minister's "solemn" promise before the election not to cut tax credits.

Mr Corbyn said: "Is there any reason why this change has come about or any reason why we should believe you on any assurances you give in relation to tax credits?"

The Prime Minister replied: "What we said before the election was we would reduce welfare by £12 billion as part of getting the deficit down, part of getting the economy growing and part of creating two million jobs - that is what happened at the election and we are keeping our promises by delivering that stronger economy."

He added: "You talk about something strange happening - something quite strange did happen last night. We had a vote on tax credits and the deputy leader of the Labour Party didn't turn up."

The SNP's leader in Westminster Angus Robertson said a couple who both earn just above the minimum wage living in a council house with two children "stand to lose more than £2,000" under the Government's tax credit plans.

"That's the equivalent of their basic rate of income tax rising a staggering 90%," he said.

"Does the Prime Minister have the faintest idea about the human cost of his plans?"

Mr Cameron rebuffed the suggestion.

"First of all if the couple live in a council house then they are actually seeing a cut in their social rent because of the plans set out in the Budget," he said.

"If that couple have children they will have support in terms of childcare.

"If that couple are working for a small business they will have the opportunity of the enhanced employment allowance.

"If that couple are earning just above the minimum wage, if they are earning for instance £7 an hour and working a full-time working week, they will see a huge benefit as we increase the income tax allowance to £12,500.

"They will almost be paying no income tax at all."

A senior Labour source later said: "We were shocked to hear David Cameron say twice that he was 'delighted' that the vote was carried last night, delighted that working people are going to lose hundreds of pounds.

"That was quite a surprise to us. It's not going to be an issue of delight for many people."

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