THE BUDGET is over.
Last week’s statement by the Chancellor of the Exchequer has been responded to, studied in the press and already the wheels seem to have come off.
Of course, there is more investigation to do and a lot of that will be done by the Treasury Select Committee, although that is mainly made up of Labour MPs, so it is unlikely to be too negative.
What is key, though, is this seems to be a budget that appeases left-wing Labour backbenchers.
Rachel Reeves allowed – even encouraged – speculation to build the budget regulators had identified a £30billion black hole in the public finances. It was a rather odd position for any chancellor to take, as the only blame for this would be her actions at the previous budget.
As it turned out, she leapt on the opportunity this misinformation presented to hike taxes on hard-working families, blaming a whole load of things that, of course, were nothing to do with her.
But it turned out there was no fiscal black hole. In fact, there was a fiscal surplus. So all this extra taxation has gone on hiking welfare payments.
Our welfare bill has got completely out of hand. It has taken on a life of its own.
Rachel Reeves’ key policy was to abolish the two-child benefit cap.
There is a debate to be had about incentivising large families in poor households, but the problem has been illustrated by the think-tank, the Centre for Social Justice.
It has calculated that a three-child family claiming all the benefits, housing, universal credit and all the rest of it available to them will be generating a tax payer-funded income equivalent to that of a three child working family on £71,000 a year pre-tax income.
The average salary here in Wyre Forest is £32,000. For full time employees, it is £37,900.
No-one wants child poverty. That is why the majority of people agree that support for two child families is a good thing. And most families get child credit as well.
But suggesting a hard-working family would be better off on benefits is wrong.
