One of the rows that the Tories are starting their conference with is over tax credits. A growing number of MPs, including Boris Johnson, have expressed concern about the changes, which lower the threshold for withdrawing tax credits from £6,420 to £3,850 and speed up the rate of withdrawal as pay rises. But today on the Andrew Marr Show, David Cameron made clear that there wouldn’t be a review of these cuts. He was asked if George Osborne might change the plans in the Autumn Statement:
‘No. We think the changes we put forward are right and they come with higher pay and lower taxes.’
They do come with higher pay and lower taxes, but as the Institute for Fiscal Studies made clear right after the summer Budget, these do not compensate for the cuts to tax credits. And those who support the principle of reforming the benefits system so that tax credits do not subsidise poverty pay, like Frank Field, are annoyed that the government has chosen to make the changes not just for new claimants but for existing ones too.
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