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Cost of Living

Volume 557: debated on Tuesday 29 January 2013

The Government continue to take steps to support households. The personal allowance will be increased to £9,440 in April 2013 to support hard-working individuals. The cash increase in that year is the largest ever. The 3p fuel duty increase planned for January 2013 has been cancelled, as a result of which fuel duty will have been frozen for two and a half years.

I thank my right hon. Friend for that answer and warmly welcome the fact that more than 1,700 people in my constituency have been taken out of paying income tax altogether by the raising of the threshold, and that more than 42,000 people in my constituency have had their income tax reduced as a result. May I urge him to be bold and go further?

I am grateful to my hon. Friend for those comments. We are increasing the tax allowance towards the bold and ambitious goal of £10,000, which Conservatives and Liberal Democrats have joined together in coalition to deliver. We will certainly be bold and ambitious, and I will take his comments as a Budget submission.

For the third year running, the Government have provided additional funds to councils to allow them to freeze council tax, which doubled under the Labour Government. I am aware that Warwickshire county council intends to freeze council tax, but will my right hon. Friend join me in urging Nuneaton and Bedworth borough council and North Warwickshire borough council, which are Labour controlled, to get on board, freeze council tax and give the hard-working people in my constituency a break?

My hon. Friend makes an important point. We have provided funding to local authorities to enable the council tax freeze to be delivered. Of course, councillors in those areas will be answerable to their constituents if they fail to deliver the substantial financial benefit that that offers. He is right to say that council tax doubled during the Labour party’s time in office.

Does the right hon. Gentleman accept that the cost of living increases have hit the poorest hardest, including the man I mentioned last week in Prime Minister’s questions? Should we not therefore follow the US in taxing the top 2% more, having net investment and generating an extra 1% growth, rather than hitting the poor hardest?

In that case, I am sure that the hon. Gentleman will welcome the fact that the wealthiest in society are paying more in every year of this Government’s time in office than they ever did under the Labour party.

Analysis by Citizens Advice shows that the Chancellor’s cuts to tax credits and benefits will

“swamp any gains from the change in personal tax allowances for almost all low income households…and many middle income families”.

How can that hit on working families be justified on the same day as millionaires are getting a tax cut?

The hon. Lady will know that working people in this country are net beneficiaries of the measures announced in the autumn statement. I would have thought that she would welcome the fact that 2.2 million Scots will gain from the increase in the personal allowance. It is a massive policy to ensure that the working people of this country have more of their own money back in their pockets to use for themselves.