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Benefits freeze will hit 13m families, says the IFS – Politics live Benefits freeze will hit 13m families, says the IFS – Politics live
(35 minutes later)
3.35pm BST15:35
Jess Phillips, the MP for Birmingham Yardley, has written how “I relied on benefits” in a blog on the Huffington Post.
Check me out, modern day front page news pic.twitter.com/beLE2OaOI0
In the post, Phillips argues tax credits are a handup not a handout.
She said: “There are two things that gall me about what Mr Osborne said in the budget. The first is the idea that benefits system should not support “lifestyles” those in work cannot afford.”
Phillips argues this is because she was in fact working. On the critique of living a lifestyle on benefits she said: “like to see him [Osborne] live it up on these benefits.”
Phillips adds: “The second thorn in the budget is the rebirth of the idea that people have extra babies to get benefits.”
3.17pm BST15:17
On to constitutional reform news, plans for English votes for English laws is to be revised after a Commons revolt.
Tory whips have warned Downing Street it faced defeat because rebel Conservatives had joined forces with the Democratic Unionist party (DUP), Nicholas Watt our political corespondent reports.
Alistair Carmichael, the former Lib Dem Scotland secretary, said that the government’s plans had descended into farce after a humiliating climbdown.
You can read the full account here:
Related: English votes for English laws plan to be revised after Commons revolt
Updated at 3.17pm BST
3.11pm BST15:11
Andy Burnham, the Labour leadership hopeful, has called the IFS verdict on the Budget “devastating” and condemned the celebrations of Iain Duncan Smith, the work and pensions secretary, in the commons.
Burnham said in a tweet it showed the “nasty party was well and truly back”.
Read the devastating @TheIFS verdict on the Budget. Then look at this picture again. Nasty Party is well & truly back pic.twitter.com/f0c7Ysfp6t
The IFS said 13 million families will be worse off because of the freeze on working-age benefits (see 13:48pm)
Updated at 3.14pm BST
3.06pm BST15:06
Earlier, John Cridland the director general of the CBI – the independent employers organisation – also reacted to the national Living Wage and said it was a “gamble” that risked politicising the process and causing problems for some small businesses.
“The businesses that will be under the most pressure, paying a significantly higher minimum wage - 6% higher on average every year in this Parliament - aren’t the same businesses as a whole who will get the benefit from the tax reductions,” he told Today this morning.
“Setting the minimum wage isn’t about morality. What we have done with the minimum wage is do the best we possibly can for low-paid workers while keeping them in a job by forensically setting a rate that small businesses could afford to pay. Now that is being prejudged by politicians to achieve a social objective.”
Menawhile, Chris Leslie the new shadow chancellor said Labour was “delighted” that Mr Osborne had “stolen” some of its manifesto policies – such as the increase in the minimum wage.
But he added (see 11:36am): “Do not under-estimate how important those tax credits have been for many, many people who will be waking up this morning and I think left reeling by the massive reduction to their quality of life that will come because of the nature of this set of decisions.
“It will really hit working families hard.”
Updated at 3.08pm BST
2.54pm BST14:542.54pm BST14:54
In two separate charts, the IFS shows what the impact of tax and benefit reforms will be, between five and nine years:In two separate charts, the IFS shows what the impact of tax and benefit reforms will be, between five and nine years:
Impact of tax and benefit reforms between Jan 2010 and April 2019 (incl. universal credit): http://t.co/Gd3KOr1mA2 pic.twitter.com/LkDwX4SGzXImpact of tax and benefit reforms between Jan 2010 and April 2019 (incl. universal credit): http://t.co/Gd3KOr1mA2 pic.twitter.com/LkDwX4SGzX
Impact of tax and benefit reforms between April 2015 and April 2019 (incl. universal credit): http://t.co/Gd3KOr1mA2 pic.twitter.com/AYkv1ZUWxaImpact of tax and benefit reforms between April 2015 and April 2019 (incl. universal credit): http://t.co/Gd3KOr1mA2 pic.twitter.com/AYkv1ZUWxa
2.45pm BST14:452.45pm BST14:45
Ed Miliband, the former Labour leader, has responded to the IFS verdict (see 13:48pm). He tweeted:Ed Miliband, the former Labour leader, has responded to the IFS verdict (see 13:48pm). He tweeted:
@TheIFS verdict is stark: rise in minimum wage doesn't compensate for cuts to tax credits & poorest hit far harder than richest by Budget.@TheIFS verdict is stark: rise in minimum wage doesn't compensate for cuts to tax credits & poorest hit far harder than richest by Budget.
The shadow business secretary cited a key part of the IFS statement:The shadow business secretary cited a key part of the IFS statement:
.@TheIFS:"simply not enough money going in to the new minimum wage to anywhere near compensate people on tax credits" http://t.co/68Dorj1pPA.@TheIFS:"simply not enough money going in to the new minimum wage to anywhere near compensate people on tax credits" http://t.co/68Dorj1pPA
Iain Watson the BBC political correspondent has said:Iain Watson the BBC political correspondent has said:
State will be much same size- as % of national income - than it was in late 90s says IFS but higher proportion spent on health, pensionsState will be much same size- as % of national income - than it was in late 90s says IFS but higher proportion spent on health, pensions
Jonathan Portes, the director of the National Institute of Economic and Social Research linked to an extract from Paul Johnson’s IFS assessment, that ends with:Jonathan Portes, the director of the National Institute of Economic and Social Research linked to an extract from Paul Johnson’s IFS assessment, that ends with:
This was a big Budget in some respects. It was a deeply disappointing Budget for those of us who hoped the Chancellor might take the chance to improve, simplify and reform our creaking tax system. This was not the Budget of a tax reforming Chancellor.This was a big Budget in some respects. It was a deeply disappointing Budget for those of us who hoped the Chancellor might take the chance to improve, simplify and reform our creaking tax system. This was not the Budget of a tax reforming Chancellor.
Yet Portes said he would be “slightly less” negative:Yet Portes said he would be “slightly less” negative:
This is the most damning IFS assessment of any Budget I've ever seen: http://t.co/CzO1IrlzCT [for record, I'd be slightly less negative].This is the most damning IFS assessment of any Budget I've ever seen: http://t.co/CzO1IrlzCT [for record, I'd be slightly less negative].
In fact, Portes concluded in a blog that it was a budget for “hard-working Poles.”In fact, Portes concluded in a blog that it was a budget for “hard-working Poles.”
Updated at 2.47pm BSTUpdated at 2.47pm BST
2.31pm BST14:312.31pm BST14:31
IMF cuts world growth forecastIMF cuts world growth forecast
The International Monetary Fund (IMF), an organisation of 188 countries, has said a slowdown in economic output in the UK and other advanced economies in this year’s first quarter will peg back global growth.The International Monetary Fund (IMF), an organisation of 188 countries, has said a slowdown in economic output in the UK and other advanced economies in this year’s first quarter will peg back global growth.
In its latest World Economic Outlook, the IMF predicted world growth of 3.4% this year, down from its previous projection in April of 3.5%.In its latest World Economic Outlook, the IMF predicted world growth of 3.4% this year, down from its previous projection in April of 3.5%.
The IMF had forecast UK growth this year would fall to 2.4%, from 2.7% in April, and next year it cuts expansion to 2.2% from 2.3%.The IMF had forecast UK growth this year would fall to 2.4%, from 2.7% in April, and next year it cuts expansion to 2.2% from 2.3%.
The organisation had also has dismissed fears that the Greek crisis will slow down the global economic recovery.The organisation had also has dismissed fears that the Greek crisis will slow down the global economic recovery.
Blanchard: Greece a reminder of the dangers of high debt. http://t.co/ORzIA4vT5O #WEO pic.twitter.com/kfifAzIHjfBlanchard: Greece a reminder of the dangers of high debt. http://t.co/ORzIA4vT5O #WEO pic.twitter.com/kfifAzIHjf
The report has said that oil prices had rebounded more than expected, after falling by more than half since last summer due to the crisis in the Ukraine and overproduction.The report has said that oil prices had rebounded more than expected, after falling by more than half since last summer due to the crisis in the Ukraine and overproduction.
It expected the average price of oil to be 59 US dollars (38) per barrel over the year.It expected the average price of oil to be 59 US dollars (38) per barrel over the year.
Meanwhile, the latest forecast from the Office for Budget Responsibility (OBR) for UK growth has slightly revised down the expectation for 2015 to 2.4% from 2.5%, due to lower-than-expected growth in the first quarter of the year.Meanwhile, the latest forecast from the Office for Budget Responsibility (OBR) for UK growth has slightly revised down the expectation for 2015 to 2.4% from 2.5%, due to lower-than-expected growth in the first quarter of the year.
You can read more about it here:You can read more about it here:
Related: IMF cuts 2015 growth forecast for US, UK, Japan and CanadaRelated: IMF cuts 2015 growth forecast for US, UK, Japan and Canada
Updated at 2.32pm BSTUpdated at 2.32pm BST
2.15pm BST14:152.15pm BST14:15
Aisha GaniAisha Gani
Hello, I’m Aisha Gani and I’ll be taking you through the rest of this afternoon’s proceedings in parliament. You can tweet me at @aishagani and feel free to leave comments below the line – I’ll include the best ones.Hello, I’m Aisha Gani and I’ll be taking you through the rest of this afternoon’s proceedings in parliament. You can tweet me at @aishagani and feel free to leave comments below the line – I’ll include the best ones.
So far there has mostly been debates on the sustainability of the NHS, mental health services in schools, and on the plight of refugees in the commons.So far there has mostly been debates on the sustainability of the NHS, mental health services in schools, and on the plight of refugees in the commons.
But back to budget responses, perhaps the most intriguing query today was from Labour’s Helen Goodman, the shadow work and pensions secretary.But back to budget responses, perhaps the most intriguing query today was from Labour’s Helen Goodman, the shadow work and pensions secretary.
She suggested that the budget is unfair to Catholics because of plans to limit to two the number of children eligible for tax credits from April 2017.She suggested that the budget is unfair to Catholics because of plans to limit to two the number of children eligible for tax credits from April 2017.
Goodman said: “Could you explain to the House why cutting tax credits for large families is a fair thing to do when it will be concentrated... on families where children are living in poverty, on Roman Catholic families, on Catholics from other minorities.Goodman said: “Could you explain to the House why cutting tax credits for large families is a fair thing to do when it will be concentrated... on families where children are living in poverty, on Roman Catholic families, on Catholics from other minorities.
“Don’t you understand that every child matters?”“Don’t you understand that every child matters?”
Ian Duncan Smith, the work and pensions secretary replied: “I have for some time believed the way tax credits operated distorted the system so there were far too many families not going into work, living in bigger and bigger houses, with larger families subsidised by the state when many others, the vast majority of families in Britain, make decisions about how many children they can have and the houses they can live in.Ian Duncan Smith, the work and pensions secretary replied: “I have for some time believed the way tax credits operated distorted the system so there were far too many families not going into work, living in bigger and bigger houses, with larger families subsidised by the state when many others, the vast majority of families in Britain, make decisions about how many children they can have and the houses they can live in.
“Getting that balance back is about getting fairness back into the system.”“Getting that balance back is about getting fairness back into the system.”
2.08pm BST14:082.08pm BST14:08
Taking a short break from the IFS verdict, the Guardian’s Scotland correspondent Libby Brooks has written about a controversial line in the summer budget which suggests a woman who becomes pregnant with a third child after being raped would have to justify her position in order to get tax credits. She writes –Taking a short break from the IFS verdict, the Guardian’s Scotland correspondent Libby Brooks has written about a controversial line in the summer budget which suggests a woman who becomes pregnant with a third child after being raped would have to justify her position in order to get tax credits. She writes –
The government has been challenged to justify an “incredibly distasteful” proposal in Wednesday’s budget which would require a woman who had a third child as the result of rape to justify her position in order to avoid losing tax credits.The government has been challenged to justify an “incredibly distasteful” proposal in Wednesday’s budget which would require a woman who had a third child as the result of rape to justify her position in order to avoid losing tax credits.
The plans to restrict child tax credits to two children for new claimants from 2017 include a number of exemptions, including multiple births, and set out that “the Department for Work and Pensions and HMRC will develop protections for women who have a third child as a result of rape or other exceptional circumstances”.The plans to restrict child tax credits to two children for new claimants from 2017 include a number of exemptions, including multiple births, and set out that “the Department for Work and Pensions and HMRC will develop protections for women who have a third child as a result of rape or other exceptional circumstances”.
Alison Thewliss, SNP MP for Glasgow Central, who first drew attention to the clause on Twitter on Wednesday afternoon, described what would inevitably result in a woman having to prove to a DWP official that she had been raped as appalling.Alison Thewliss, SNP MP for Glasgow Central, who first drew attention to the clause on Twitter on Wednesday afternoon, described what would inevitably result in a woman having to prove to a DWP official that she had been raped as appalling.
I am utterly furious that Tories will make women who've had a child after being raped justify that for tax credits. pic.twitter.com/Ai4SKBOHaQI am utterly furious that Tories will make women who've had a child after being raped justify that for tax credits. pic.twitter.com/Ai4SKBOHaQ
2.02pm BST14:022.02pm BST14:02
Here’s some initial Twitter reaction from the IFS’s verdict.Here’s some initial Twitter reaction from the IFS’s verdict.
There seems genuine surprise in some quarters that a Conservative budget has taken much more from poorer households than richer onesThere seems genuine surprise in some quarters that a Conservative budget has taken much more from poorer households than richer ones
IFS says IHT changes increases the bias towards owner occupation and may push up house prices #budget2015IFS says IHT changes increases the bias towards owner occupation and may push up house prices #budget2015
not much on this in the Budget... although OBR suggested 14000 less housing association homes.. perhaps more at SR: pic.twitter.com/U3ZY7nxcWMnot much on this in the Budget... although OBR suggested 14000 less housing association homes.. perhaps more at SR: pic.twitter.com/U3ZY7nxcWM
Seems Osborne has bucked one trend though: amount of tax raised in post-election budgets. Most hike tax by £5bn-this one raises even moreSeems Osborne has bucked one trend though: amount of tax raised in post-election budgets. Most hike tax by £5bn-this one raises even more
1.48pm BST13:481.48pm BST13:48
Paul Johnson of the IFS has made his opening remarks. Here are the key quotes –Paul Johnson of the IFS has made his opening remarks. Here are the key quotes –
Falling value of public pay relative to private sector - full presentation here: http://t.co/VTCNsapf24 #ifsbudget pic.twitter.com/qigwWa72JNFalling value of public pay relative to private sector - full presentation here: http://t.co/VTCNsapf24 #ifsbudget pic.twitter.com/qigwWa72JN
Statutory corporate tax rates in the G20, 2015 - from this #ifsbudget briefing presentation: http://t.co/HAWHKEli0H pic.twitter.com/DAt3qeakX7Statutory corporate tax rates in the G20, 2015 - from this #ifsbudget briefing presentation: http://t.co/HAWHKEli0H pic.twitter.com/DAt3qeakX7
Johnson concludes –Johnson concludes –
1.26pm BST13:261.26pm BST13:26
The IFS briefing has started now and you can watch it here.The IFS briefing has started now and you can watch it here.
Extract from Paul Johnson's opening remarks at #ifsbudget briefing, underway now pic.twitter.com/CJgsHitvjiExtract from Paul Johnson's opening remarks at #ifsbudget briefing, underway now pic.twitter.com/CJgsHitvji
1.22pm BST13:221.22pm BST13:22
People on tax credits will be "significantly worse off" because of the budget, says the IFSPeople on tax credits will be "significantly worse off" because of the budget, says the IFS
Paul Johnson has been speaking on the BBC’s World at One. He said that, of the range of cuts included in yesterday’s budget plans, the freezing of most working age benefits through to 2020 would have the biggest effect, saving £4bn over that period. 13m UK families will lose average of £260 a year due to budget’s freeze on working-age benefitsPaul Johnson has been speaking on the BBC’s World at One. He said that, of the range of cuts included in yesterday’s budget plans, the freezing of most working age benefits through to 2020 would have the biggest effect, saving £4bn over that period. 13m UK families will lose average of £260 a year due to budget’s freeze on working-age benefits
The reduction of the work allowance will also have a huge effect, he said, meaning cuts will be bigger for those with a job, reducing incentives for people to move into work.The reduction of the work allowance will also have a huge effect, he said, meaning cuts will be bigger for those with a job, reducing incentives for people to move into work.
The minimum wage announcement won’t “anywhere near compensate in cash terms” for the welfare cuts, he said. People currently on tax credits will be “significantly worse off” and the reform would cost 3m families an average of £5,000 per year each.The minimum wage announcement won’t “anywhere near compensate in cash terms” for the welfare cuts, he said. People currently on tax credits will be “significantly worse off” and the reform would cost 3m families an average of £5,000 per year each.
The public sector pay rise cap of 1% is more dramatic than it seems, says Paul Johnson. By 2020 public sector pay will be much lower compared to private sector pay than it has been for 30 years.The public sector pay rise cap of 1% is more dramatic than it seems, says Paul Johnson. By 2020 public sector pay will be much lower compared to private sector pay than it has been for 30 years.
Updated at 1.56pm BSTUpdated at 1.56pm BST
1.05pm BST13:051.05pm BST13:05
The Institute for Fiscal Studies is about to start its briefing on yesterday’s budget. But, in the mean time, the BBC’s World at One has interviewed the IFS’s director Paul Johnson and the verdict doesn’t look great.The Institute for Fiscal Studies is about to start its briefing on yesterday’s budget. But, in the mean time, the BBC’s World at One has interviewed the IFS’s director Paul Johnson and the verdict doesn’t look great.
Paul Johnson (@TheIFS) tells #wato as a result of the #Budget poorer households will lose out "significantly" pic.twitter.com/7fzlHlYEYBPaul Johnson (@TheIFS) tells #wato as a result of the #Budget poorer households will lose out "significantly" pic.twitter.com/7fzlHlYEYB
12.56pm BST12:5612.56pm BST12:56
Iain Duncan Smith is making his closing comments in the debate in parliament.Iain Duncan Smith is making his closing comments in the debate in parliament.
I believe the next five years will see a renaissance in Britain as we change to an economic powerhouse, both in the North and in the South, with more people back to work earning a decent wage, in fact a living wage...I believe the next five years will see a renaissance in Britain as we change to an economic powerhouse, both in the North and in the South, with more people back to work earning a decent wage, in fact a living wage...
Even with the changes we are making, the welfare system will remain generous. Around 5 in 10 families with children will still be eligible for tax credits as a result of these reforms. These figures show that we are taking a balanced approach to welfare, an approach that allows people to stand on their own two feet whenever possible, but provides them with the support to do that. To reduce their taxes, to provide childcare and skills support. Providing intensive back to work support, introducing universal credit to make work pay and asking employers to play their part by increasing wages at a time when our economy is growing.Even with the changes we are making, the welfare system will remain generous. Around 5 in 10 families with children will still be eligible for tax credits as a result of these reforms. These figures show that we are taking a balanced approach to welfare, an approach that allows people to stand on their own two feet whenever possible, but provides them with the support to do that. To reduce their taxes, to provide childcare and skills support. Providing intensive back to work support, introducing universal credit to make work pay and asking employers to play their part by increasing wages at a time when our economy is growing.
In conclusion, the believe Mr deputy Speaker, it is an approach that continues to provide a generous safety net and support for those who need it. It expects people to take the same choices as those in work do and those not on benefits, and at its heart it is an approach that is about moving from a low wage, high tax, high welfare country to a high wage, low tax, lower welfare country. It’s a positive vision for Britain under a one nation Conservative government, delivered by a great chancellor and a great prime minister.In conclusion, the believe Mr deputy Speaker, it is an approach that continues to provide a generous safety net and support for those who need it. It expects people to take the same choices as those in work do and those not on benefits, and at its heart it is an approach that is about moving from a low wage, high tax, high welfare country to a high wage, low tax, lower welfare country. It’s a positive vision for Britain under a one nation Conservative government, delivered by a great chancellor and a great prime minister.
12.35pm BST12:3512.35pm BST12:35
A Labour MP has suggested govt's benefit cuts will discriminate against Roman Catholics who have religious objections to contraception.A Labour MP has suggested govt's benefit cuts will discriminate against Roman Catholics who have religious objections to contraception.
Helen Goodman said that catholics with large families would be unfairly hit by plans to restrict Child Tax Credits to the first 2 childrenHelen Goodman said that catholics with large families would be unfairly hit by plans to restrict Child Tax Credits to the first 2 children
There has been a lot of Twitter comment about the two child tax credit cap. Journalist Dawn Foster found the section of the red book that says protections will be developed for women in “exceptional circumstances”, including becoming pregnant as a result of rape.There has been a lot of Twitter comment about the two child tax credit cap. Journalist Dawn Foster found the section of the red book that says protections will be developed for women in “exceptional circumstances”, including becoming pregnant as a result of rape.
So Treasury genuinely discussed whether mothers of three should receive child benefit if they were raped #Budget2015 pic.twitter.com/MLQzpm3ypsSo Treasury genuinely discussed whether mothers of three should receive child benefit if they were raped #Budget2015 pic.twitter.com/MLQzpm3yps
12.25pm BST12:2512.25pm BST12:25
Iain Duncan Smith opens his responses to Leslie by saying – with Osborne grinning in the background – that the chancellor would be looked back on as “one of the greatest”.Iain Duncan Smith opens his responses to Leslie by saying – with Osborne grinning in the background – that the chancellor would be looked back on as “one of the greatest”.
IDS criticises the tax credit system, which he says was the brain child of Gordon Brown. 40% of those being given tax credits have tax taken off them, which is then recycled through the system before being given back to them.IDS criticises the tax credit system, which he says was the brain child of Gordon Brown. 40% of those being given tax credits have tax taken off them, which is then recycled through the system before being given back to them.
Tax credits cost the government £1.1bn in the first year it was introduced. It is now costing £30bn per year, most of which is on child tax credits. It was “money pumped into the system to chase, what was then, a moving poverty line,” says IDS. He also accuses the last Labour government of raising tax credit spending in run up to general elections.Tax credits cost the government £1.1bn in the first year it was introduced. It is now costing £30bn per year, most of which is on child tax credits. It was “money pumped into the system to chase, what was then, a moving poverty line,” says IDS. He also accuses the last Labour government of raising tax credit spending in run up to general elections.
Updated at 12.38pm BSTUpdated at 12.38pm BST
12.13pm BST12:1312.13pm BST12:13
Shailesh Vara, MP North West Cambridgeshire, has been appointed Parliamentary Under Secretary of State at Department for Work and Pensions.Shailesh Vara, MP North West Cambridgeshire, has been appointed Parliamentary Under Secretary of State at Department for Work and Pensions.
Updated at 12.37pm BSTUpdated at 12.37pm BST
12.07pm BST12:0712.07pm BST12:07
Yvette Cooper opposes 1% public sector pay capYvette Cooper opposes 1% public sector pay cap
Yvette Cooper, one of Labour’s four leadership candidates, has announced that she opposes the government’s planned five year 1% cap on public sector pay.Yvette Cooper, one of Labour’s four leadership candidates, has announced that she opposes the government’s planned five year 1% cap on public sector pay.
In a statement, Yvette Cooper has said:In a statement, Yvette Cooper has said:
This is an ideological assault on public services from George Osborne, not a sensible policy, and it isn’t fair. Is the Chancellor really saying he can afford to cut inheritance tax for estates worth £1million but the people who care for us and keep us safe should have to face five more years of real term pay cuts? And it is an utter disgrace that the Prime Minister is still considering letting an unacceptable 10% pay increase for MPs go ahead, while forcing public sector workers to fall further behind.This is an ideological assault on public services from George Osborne, not a sensible policy, and it isn’t fair. Is the Chancellor really saying he can afford to cut inheritance tax for estates worth £1million but the people who care for us and keep us safe should have to face five more years of real term pay cuts? And it is an utter disgrace that the Prime Minister is still considering letting an unacceptable 10% pay increase for MPs go ahead, while forcing public sector workers to fall further behind.
We need a responsible approach to pay that helps our public services cope with tighter budgets - supporting jobs and maintaining the quality of service. And that also means respecting the people who work so hard to care for us when we are sick or old, to teach our children, to keep our streets clean, to keep us safe from terror threats or to risk their lives defending our country.We need a responsible approach to pay that helps our public services cope with tighter budgets - supporting jobs and maintaining the quality of service. And that also means respecting the people who work so hard to care for us when we are sick or old, to teach our children, to keep our streets clean, to keep us safe from terror threats or to risk their lives defending our country.
I will not support this five year 1% cap, and I believe Labour must have the confidence to stand up for what is right for our public services and fair for hard working people. The Government needs to change track before our vital services pay the price.I will not support this five year 1% cap, and I believe Labour must have the confidence to stand up for what is right for our public services and fair for hard working people. The Government needs to change track before our vital services pay the price.
At a lobby briefing yesterday, Chris Leslie – who is currently attacking the chancellor’s budget in parliament – suggested it was not something he would oppose.At a lobby briefing yesterday, Chris Leslie – who is currently attacking the chancellor’s budget in parliament – suggested it was not something he would oppose.
It is very difficult, I think we’ve got to weigh up some of these changes and be more thoughtful in the way that we don’t just literally oppose everything, as Harriet was saying, tempting though it might be to oppose everything. We don’t want to see public sector jobs being lost in the way that would happen if you found departments choosing to raise pay but making people redundant. And that is a very difficult and somewhat invidious choice for those departments. Ultimately, I think a level of restraint is probably necessary.”It is very difficult, I think we’ve got to weigh up some of these changes and be more thoughtful in the way that we don’t just literally oppose everything, as Harriet was saying, tempting though it might be to oppose everything. We don’t want to see public sector jobs being lost in the way that would happen if you found departments choosing to raise pay but making people redundant. And that is a very difficult and somewhat invidious choice for those departments. Ultimately, I think a level of restraint is probably necessary.”
Updated at 12.37pm BSTUpdated at 12.37pm BST
11.59am BST11:5911.59am BST11:59
Iain Duncan Smith, the work and pensions secretary, has intervened to dispute Leslie’s anecdote, which he has repeated a lot today, about the effects of yesterday’s budget on a two parent family on an average salary. Leslie says they will be £2,000 poorer. IDS says they will be better off as a result of yesterday’s budget.Iain Duncan Smith, the work and pensions secretary, has intervened to dispute Leslie’s anecdote, which he has repeated a lot today, about the effects of yesterday’s budget on a two parent family on an average salary. Leslie says they will be £2,000 poorer. IDS says they will be better off as a result of yesterday’s budget.
Updated at 12.37pm BSTUpdated at 12.37pm BST
11.55am BST11:5511.55am BST11:55
We learned more about Tory plans to cut welfare in one hour of the chancellor’s budget speech yesterday than we did in a whole general election campaign, says Leslie. The Conservatives did win a majority, but they concealed their plans from the electorate.We learned more about Tory plans to cut welfare in one hour of the chancellor’s budget speech yesterday than we did in a whole general election campaign, says Leslie. The Conservatives did win a majority, but they concealed their plans from the electorate.
The Conservative manifesto said there would be a two year freeze in working age benefits, but yesterday the chancellor doubled that, he says. It was “one of the fastest broken promises in political history.”The Conservative manifesto said there would be a two year freeze in working age benefits, but yesterday the chancellor doubled that, he says. It was “one of the fastest broken promises in political history.”
11.45am BST11:4511.45am BST11:45
“The power house has become a power cut”, says Leslie of the chancellor’s Northern Powerhouse plans.“The power house has become a power cut”, says Leslie of the chancellor’s Northern Powerhouse plans.
Alex Salmond reminds Leslie that in the run-up to the Scottish referendum the former SNP leader described Darling as a “Tory front man”. Does the shadow chancellor think that this is a fitting description in light of Darling’s comments this morning? Leslie repeats that he hasn’t read Darling’s remarks, so can’t comment.Alex Salmond reminds Leslie that in the run-up to the Scottish referendum the former SNP leader described Darling as a “Tory front man”. Does the shadow chancellor think that this is a fitting description in light of Darling’s comments this morning? Leslie repeats that he hasn’t read Darling’s remarks, so can’t comment.
11.36am BST11:3611.36am BST11:36
MPs in parliament are now continuing the debate on the budget.MPs in parliament are now continuing the debate on the budget.
It was a budget entirely concerned with chasing headlines and furthering the political ambitions of the chancellor, says shadow chancellor Chris Leslie.It was a budget entirely concerned with chasing headlines and furthering the political ambitions of the chancellor, says shadow chancellor Chris Leslie.
Leslie is interrupted to be asked what he thought of comments made by former chancellor Alistair Darling, who addressed an audience at Edelman this morning. Darling is reported to have said that Labour is in disarray and are paying the price of not having a credible economic policy.Leslie is interrupted to be asked what he thought of comments made by former chancellor Alistair Darling, who addressed an audience at Edelman this morning. Darling is reported to have said that Labour is in disarray and are paying the price of not having a credible economic policy.
Leslie says he hasn’t read Darlings comments. Leslie says he hasn’t read Darling’s comments.
Updated at 12.38pm BST Updated at 3.39pm BST
11.30am BST11:3011.30am BST11:30
Evel vote climbdown shows how important the votes of the DUP could be over the next five years - to both sides... http://t.co/SgIpmJJ7hnEvel vote climbdown shows how important the votes of the DUP could be over the next five years - to both sides... http://t.co/SgIpmJJ7hn
11.27am BST11:2711.27am BST11:27
The government announces EVEL delayThe government announces EVEL delay
The government will re-write its EVEL (English Votes for English Laws) plans – which would give MPs representing English constituencies a veto over laws affecting England only. The government will rewrite its EVEL (English Votes for English Laws) plans – which would give MPs representing English constituencies a veto over laws affecting England only.
Leader of the Commons, Chris Grayling, told parliament that the vote – which had been due to take place last week – would be delayed until after the summer recess and that there would be a two-day debate on a modified set of proposals. The Leader of the Commons, Chris Grayling, told parliament that the vote – which had been due to take place last week – would be delayed until after the summer recess and that there would be a two-day debate on a modified set of proposals.
Majority of 12 not quite as big as it felt a month ago, eh? https://t.co/seblHGp9YPMajority of 12 not quite as big as it felt a month ago, eh? https://t.co/seblHGp9YP
Updated at 3.39pm BST
11.18am BST11:1811.18am BST11:18
The budget is a "new contract with the country", says George OsborneThe budget is a "new contract with the country", says George Osborne
The chancellor has been all over breakfast television this morning, answering questions about the first budget from a Conservative majority government since 1996. Here’s a summary of the highlights – The chancellor has been all over breakfast television this morning, answering questions about the first budget from a Conservative majority government since 1996. Here’s a summary of the highlights:
The budget offers a new contract with the country, Osborne told Sky News.The budget offers a new contract with the country, Osborne told Sky News.
It says to businesses ‘we are going to cut your taxes but you have to pay higher salaries’. It says to people ‘we are going to make sure you get a proper wage, a National Living wage, but there are going to be less benefits’. And it says to the country ‘we are going to spend less but we are going to live within our means and have economic security’.” It says to businesses ‘we are going to cut your taxes but you have to pay higher salaries’. It says to people ‘we are going to make sure you get a proper wage, a National Living Wage, but there are going to be less benefits’. And it says to the country ‘we are going to spend less but we are going to live within our means and have economic security’.”
Appearing on the Today programme, Osborne was asked about his national living wage announcement: “I also gave Britain the lowest business tax rate of any major economy in the world: 18%. I also cut taxes for small businesses and cut their national insurance bills so they can adjust as well. So I think it’s important to remember it is part of a package.” Appearing on the Today programme, Osborne was asked about his “national living wage” announcement: “I also gave Britain the lowest business tax rate of any major economy in the world: 18%. I also cut taxes for small businesses and cut their national insurance bills so they can adjust as well. So I think it’s important to remember it is part of a package.”
The chancellor was asked about Tim Montgomerie’s column in the Times today, which quotes an unnamed cabinet minister as saying that the minimum wage announcement was designed to “kick lazy British businesses up the arse”.The chancellor was asked about Tim Montgomerie’s column in the Times today, which quotes an unnamed cabinet minister as saying that the minimum wage announcement was designed to “kick lazy British businesses up the arse”.
I don’t know exactly who said that but I’d use slightly more diplomatic language which is there are some really great British companies – I’m at one today here in Lancashire, they’re hiring apprentices, they’re providing great skills for their workforce – and there are other businesses that, frankly, have taken a free ride on that because they’re not training their own workforces. They use training that others have provided.” I don’t know exactly who said that but I’d use slightly more diplomatic language, which is there are some really great British companies – I’m at one today here in Lancashire, they’re hiring apprentices, they’re providing great skills for their workforce – and there are other businesses that, frankly, have taken a free ride on that because they’re not training their own workforces. They use training that others have provided.”
Osborne was asked about the plans to limit child tax credit support to two children. “It doesn’t affect people today, the policy on children; that is for future families,” he said.Osborne was asked about the plans to limit child tax credit support to two children. “It doesn’t affect people today, the policy on children; that is for future families,” he said.
It’s part of saying to our country: look, we’ve got to have a better contract. We can pay this national living wage but we can’t have this welfare system that just grows and grows and grows, crowds out the kind of spending I think we should be making on things like education and infrastructure in our country to provide for the real welfare of the country in the future.”It’s part of saying to our country: look, we’ve got to have a better contract. We can pay this national living wage but we can’t have this welfare system that just grows and grows and grows, crowds out the kind of spending I think we should be making on things like education and infrastructure in our country to provide for the real welfare of the country in the future.”
Updated at 3.38pm BST
10.58am BST10:5810.58am BST10:58
Former guitarist with the Smiths, Johnny Marr, has also weighed in ...Former guitarist with the Smiths, Johnny Marr, has also weighed in ...
Do Cameron & Osborne actually think that people in the north are ok with the term "Northern Powerhouse ?". Patronising and thick or what ?Do Cameron & Osborne actually think that people in the north are ok with the term "Northern Powerhouse ?". Patronising and thick or what ?
Updated at 11.18am BSTUpdated at 11.18am BST
10.36am BST10:3610.36am BST10:36
Alistair Darling tells an audience at Edelman: "Lab is in disarray... We are paying the price of not having a credible econ policy."Alistair Darling tells an audience at Edelman: "Lab is in disarray... We are paying the price of not having a credible econ policy."
10.33am BST10:3310.33am BST10:33
The Green party’s only MP, Caroline Lucas, has written in the New Statesman about the welfare cap. Osborne announced yesterday that he would be lowering the welfare cap to £20,000 per family (£23,000 in London) down from the previous cap, introduced by the coalition government, of £26,000.The Green party’s only MP, Caroline Lucas, has written in the New Statesman about the welfare cap. Osborne announced yesterday that he would be lowering the welfare cap to £20,000 per family (£23,000 in London) down from the previous cap, introduced by the coalition government, of £26,000.
The welfare cap appeals to the very worst in human nature. It’s part of a narrative that chooses to ignore the underlying causes of poverty or inequality, justifies punishing anyone out of work, and breeds resentment towards anyone who falls on hard times. Sadly, it’s a narrative that the shadow frontbench will not risk challenging – and many are even willing to go along with it.The welfare cap appeals to the very worst in human nature. It’s part of a narrative that chooses to ignore the underlying causes of poverty or inequality, justifies punishing anyone out of work, and breeds resentment towards anyone who falls on hard times. Sadly, it’s a narrative that the shadow frontbench will not risk challenging – and many are even willing to go along with it.
10.15am BST10:1510.15am BST10:15
It’s likely that other aspects of the budget will start attracting attention as the day progresses, but this moment – which came at the end of Osborne’s hour-long speech – is the main focus of attention this morning.It’s likely that other aspects of the budget will start attracting attention as the day progresses, but this moment – which came at the end of Osborne’s hour-long speech – is the main focus of attention this morning.
Shadow health secretary and Labour leadership candidate Andy Burnham has written for Huffington Post, focusing on the fact that the new ‘National Living Wage’ will only kick in for 25-year-olds.Shadow health secretary and Labour leadership candidate Andy Burnham has written for Huffington Post, focusing on the fact that the new ‘National Living Wage’ will only kick in for 25-year-olds.
A Two Generations Budget, Cementing the Divide Between Young and OldA Two Generations Budget, Cementing the Divide Between Young and Old
...the biggest slap in the face for young people in this Budget is what George Osborne has done on pay. His flagship proposal of a ‘National Living Wage’ only kicks in at 25, but his cuts to tax credits affect people of all ages. He was not honest about this before the election and has no mandate for his plans. There is a real risk this will cement a two-tier workforce between young and old as he brings down the deficit on the backs of young people. ...the biggest slap in the face for young people in this budget is what George Osborne has done on pay. His flagship proposal of a ‘National Living Wage’ only kicks in at 25, but his cuts to tax credits affect people of all ages. He was not honest about this before the election and has no mandate for his plans. There is a real risk this will cement a two-tier workforce between young and old as he brings down the deficit on the backs of young people.
Updated at 10.17am BST Updated at 3.36pm BST
9.47am BST09:479.47am BST09:47
Analysis roundupAnalysis roundup
Say what you like about yesterday’s budget, it wasn’t lacking in big talking points. And the commentary in today’s papers reflects that. Here’s some of the best post-budget analysis.Say what you like about yesterday’s budget, it wasn’t lacking in big talking points. And the commentary in today’s papers reflects that. Here’s some of the best post-budget analysis.
George Osborne seeks to be a progressive, but he’s still in thrall to Thatcherism, Steve Richards in the IndependentGeorge Osborne seeks to be a progressive, but he’s still in thrall to Thatcherism, Steve Richards in the Independent
But before very long Osborne was deploying the language of the 1980s, a decade during which Margaret Thatcher strode away from one-nation Toryism. When reflecting on his plan to slash spending Osborne stated that “there can be no turning back”, a double whammy that echoed Thatcher’s defiant declaration that she was “not for turning” in relation to her economic policy and paid homage to the Thatcherite “no turning back group”. Later Osborne proudly declared that he was raising more cash from privatisations than at any point since 1987, when Thatcherism was at its height.But before very long Osborne was deploying the language of the 1980s, a decade during which Margaret Thatcher strode away from one-nation Toryism. When reflecting on his plan to slash spending Osborne stated that “there can be no turning back”, a double whammy that echoed Thatcher’s defiant declaration that she was “not for turning” in relation to her economic policy and paid homage to the Thatcherite “no turning back group”. Later Osborne proudly declared that he was raising more cash from privatisations than at any point since 1987, when Thatcherism was at its height.
Osborne focuses on the right place, Stephanie Flanders in the Financial TimesOsborne focuses on the right place, Stephanie Flanders in the Financial Times
He likes to honour past battles, this chancellor. With the decisions in this Budget, Mr Osborne has opened the way for many future ones — about the nature of the state and its role in a modern economy. He does not have all the answers, and some that he does have will seem profoundly wrong to many on the left. But he is, finally, focusing the country’s attention in the right place. He likes to honour past battles, this chancellor. With the decisions in this budget, Mr Osborne has opened the way for many future ones — about the nature of the state and its role in a modern economy. He does not have all the answers, and some that he does have will seem profoundly wrong to many on the left. But he is, finally, focusing the country’s attention in the right place.
There’s a reason Iain Duncan Smith looked so happy, Christian Guy in the TelegraphThere’s a reason Iain Duncan Smith looked so happy, Christian Guy in the Telegraph
For many years the Left took the easy way out when it came to helping our poorest families. Rather than encouraging work and rewarding those who took personal responsibility, too often they grew the welfare bill in the hope of short-term success. Lift groups of people above an income line by increasing their welfare payments, so the thinking went, and poverty would be dealt with. But Labour tested to near destruction the idea that you can tackle poverty through higher welfare spending. It sounded compassionate but it failed to change lives. For many years the left took the easy way out when it came to helping our poorest families. Rather than encouraging work and rewarding those who took personal responsibility, too often they grew the welfare bill in the hope of short-term success. Lift groups of people above an income line by increasing their welfare payments, so the thinking went, and poverty would be dealt with. But Labour tested to near destruction the idea that you can tackle poverty through higher welfare spending. It sounded compassionate but it failed to change lives.
Osborne’s budget stole Labour’s best election promises like a relative rummaging in the wardrobe, Jonathan Freedland in the GuardianOsborne’s budget stole Labour’s best election promises like a relative rummaging in the wardrobe, Jonathan Freedland in the Guardian
His chosen approach is devilishly simple. His goal is to recast the Tories as the champion of all those who enjoy the admiration or sympathy of their fellow voters – workers, especially in the private sector, pensioners, soldiers – and to let Labour be the advocate of everyone else. He wants the Conservatives to be the party of working people, leaving Labour as the party of worklessness and welfare. He’ll speak for the strivers, they can have the skivers – along with all those who either don’t vote or whose votes he’s happy to write off.His chosen approach is devilishly simple. His goal is to recast the Tories as the champion of all those who enjoy the admiration or sympathy of their fellow voters – workers, especially in the private sector, pensioners, soldiers – and to let Labour be the advocate of everyone else. He wants the Conservatives to be the party of working people, leaving Labour as the party of worklessness and welfare. He’ll speak for the strivers, they can have the skivers – along with all those who either don’t vote or whose votes he’s happy to write off.
To that end, like a grasping relative rummaging through the cupboard of a dying family member who lies helpless on the bed, Osborne set about stealing any item of Labour clothing that took his fancy – picking out all those with mainstream appeal.To that end, like a grasping relative rummaging through the cupboard of a dying family member who lies helpless on the bed, Osborne set about stealing any item of Labour clothing that took his fancy – picking out all those with mainstream appeal.
Updated at 10.16am BST Updated at 3.35pm BST
9.41am BST09:419.41am BST09:41
Thursday will be dominated by reaction to the budget, which saw Osborne hike up the minimum wage and cut tax credits. Parliament will continue debating Wednesday’s announcements and the Institute for Fiscal Studies will be doing its post-budget briefing around 1pm.Thursday will be dominated by reaction to the budget, which saw Osborne hike up the minimum wage and cut tax credits. Parliament will continue debating Wednesday’s announcements and the Institute for Fiscal Studies will be doing its post-budget briefing around 1pm.
George Osborne has been speaking to broadcasters about yesterday’s announcements. Talking on the Today programme, he repeated that he wanted a country that lives within its means. He responded to the idea that he had adopted policies proposed by the Labour party ahead of the election – like cracking down on non-doms and increasing he minimum wage. George Osborne has been speaking to broadcasters about yesterday’s announcements. Talking on the Today programme, he repeated that he wanted a country that lives within its means. He responded to the idea that he had adopted policies proposed by the Labour party ahead of the election – like cracking down on non-doms and increasing the minimum wage.
My opponents were proposing to spend more money, to increase the welfare bill and the like, and we’re not proposing that. I think people need to be very clear, there are difficult decisions to be taken on public expenditure and welfare ...the net effect is that the deficit is reduced at the same pace as the last parliament. Not faster, not slower, but at the same pace. My opponents were proposing to spend more money, to increase the welfare bill and the like, and we’re not proposing that. I think people need to be very clear, there are difficult decisions to be taken on public expenditure and welfare ... the net effect is that the deficit is reduced at the same pace as the last parliament. Not faster, not slower, but at the same pace.
Osborne was asked if his national living wage was essentially just a higher national minimum wage. “It is a national living wage. It is set, obviously, at a much higher rate than the current minimum wage, which will still apply to younger people.”Osborne was asked if his national living wage was essentially just a higher national minimum wage. “It is a national living wage. It is set, obviously, at a much higher rate than the current minimum wage, which will still apply to younger people.”
He said the policy had been influenced by a recommendation by the Resolution Foundation, which Osborne himself said was on the centre-left of British politics. The higher minimum wage would go along side welfare savings and business tax cuts. “The reason it is a Conservative budget is because all those three things are put together.” He said the policy had been influenced by a recommendation by the Resolution Foundation, which Osborne himself said was on the centre-left of British politics. The higher minimum wage would go alongside welfare savings and business tax cuts. “The reason it is a Conservative budget is because all those three things are put together.”
I’ll post more about Osborne’s appearances this morning shortly.I’ll post more about Osborne’s appearances this morning shortly.
The shadow chancellor, Chris Leslie, has also been doing the broadcast rounds commenting on the budget announcement. He told the Today programme that he welcomed the increase in the minimum wage for over 25s, but argued that it was outweighed by the £4.5bn cuts to tax credits. The shadow chancellor, Chris Leslie, has also been doing the broadcast rounds commenting on the budget announcement. He told the Today programme that he welcomed the increase in the minimum wage for over-25s, but argued that it was outweighed by the £4.5bn cuts to tax credits.
He said tax credits were vital for “making work pay” and has described the measures as a work penalty, which will disincentivise people to work. Ahead of the election, Labour pledged an increase of the minimum wage to £8 for all adults in 2020, one pound less than Osborne promised for over 25s by the same date. He said tax credits were vital for “making work pay” and has described the measures as a work penalty, which will disincentivise people to work. Ahead of the election, Labour pledged an increase of the minimum wage to £8 for all adults in 2020, one pound less than Osborne promised for over-25s by the same date.
“If he wants to steal policies in our manifesto, then fine,” said Leslie, who added that Osborne’s national living wage was simply a rebranding of the minimum wage.“If he wants to steal policies in our manifesto, then fine,” said Leslie, who added that Osborne’s national living wage was simply a rebranding of the minimum wage.
The cut in tax credits would pull the rug from underneath working people’s feet, said Leslie, citing calculations that suggested a couple with two children working full-time on average earnings would lose £2,000 a year as a result of the measures. For every £1 this family gains from the minimum wage increase, they will lose £2 from the cut in tax credits, he said.The cut in tax credits would pull the rug from underneath working people’s feet, said Leslie, citing calculations that suggested a couple with two children working full-time on average earnings would lose £2,000 a year as a result of the measures. For every £1 this family gains from the minimum wage increase, they will lose £2 from the cut in tax credits, he said.
Sorry for the delayed launch this morning (see here - London grinds to a halt). I’m filling in for Andrew Sparrow today and will be covering the breaking political news as it happens, as well as bringing you the best reaction, comment and analysis from the web.Sorry for the delayed launch this morning (see here - London grinds to a halt). I’m filling in for Andrew Sparrow today and will be covering the breaking political news as it happens, as well as bringing you the best reaction, comment and analysis from the web.
If you want to follow me on Twitter, I’m on @fperraudinIf you want to follow me on Twitter, I’m on @fperraudin
Updated at 9.57am BST Updated at 3.34pm BST