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Tax credit cuts are a very important cultural signal - Jeremy Hunt

Published 05/10/2015

Jeremy Hunt says tax credit changes send
Jeremy Hunt says tax credit changes send "a very important cultural signal"

Tax credit cuts are a "very important cultural signal" as Britain seeks to match the work ethic of Asian and American countries, Jeremy Hunt has said.

The Health Secretary said he did not "entirely buy" the argument that families will lose "hard cash" through the changes proposed by the Government, claiming the benefits of more job opportunities, extra hours and the national living wage need to be considered.

Prime Minister David Cameron has said there will be no review of the cuts in next month's Autumn Statement despite calls from within his own party for a rethink.

The independent Institute for Fiscal Studies has warned millions of people will lose up to £1,300 a year from the Budget changes.

Asked if there is a case for implementing the tax credit cuts over a longer period of time up to 2020, Mr Hunt replied: "No. We have to proceed with these tax credit changes because they're a very important cultural signal.

"My wife is Chinese and we want this to be one of the most successful countries in the world in 20, 30, 40 years time.

"There's a pretty difficult question we have to answer, which is essentially, are we going to be a country which is prepared to work hard in the way that Asian economies are prepared to work hard, in the way that Americans are prepared to work hard? And that is about creating a culture where work is at the heart of our success.

"But the hard cash argument I don't entirely buy because I don't think it takes into account the dynamic effects, it doesn't take into account the extra hours that people work, and it doesn't take into account the extra opportunities that you're giving people by creating jobs that are - through the national living wage - paid better than they would previously have been paid.

"I don't want to pretend that it won't be very challenging but I do believe that moving to a culture where work pays and we're trying to help people be independent and stand on their own two feet is the most important thing we can do for people on low incomes."

The general secretary of the Unite union, Len McCluskey, condemned Mr Hunt's comments as "a disgraceful insult from the richest member of the Cabinet to millions of people struggling to get by working hard for long hours in insecure employment".

Mr McCluskey said: " Mr Hunt should withdraw his remarks immediately and apologise. There is nothing as insulting as wealthy Cabinet ministers dishing out tax breaks to the super-wealthy, allowing massive assets to sit idle in bank accounts doing nothing for the common good, (while) working people wait in fear for the letter telling them the Government is cutting their income and ponder joining the foodbank queue.

"We are the fifth biggest economy with one of the hardest-working populations; the facts are that wealth is being hoovered up by an ever-smaller clique, while the percentage of wealth that workers enjoy falls ever backwards. This is the obscenity of our economy Mr Hunt, should be addressing."

The c hief executive of single parent charity Gingerbread, Fiona Weir, said: "Jeremy Hunt's comments that the tax credit cuts send a 'cultural signal' shows that, as well as being regressive, the Government is deeply out of touch on this issue.

"This unhelpful language further demonises those that are reliant on vital welfare payments, many of whom already have a job. In the case of single parents, two-thirds are in work but rely on tax credits to top up low wages.

"A working single parent about to lose out under the proposals is going to struggle to understand how they are expected to work harder."

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