Cutting tax credits will make Brits work as hard as the Chinese, says Tory minister Jeremy Hunt
- Health Secretary said benefit cuts send a 'very important cultural signal'
- Cabinet minister, who has a Chinese wife, backs efforts to cut handouts
- Britons should work hard like 'Asian economies are prepared to work hard'
- Osborne under pressure from Tories over impact on 13million families
- Labour fans the flames with dossier on effect of cuts in marginal Tory seats
Health Secretary Jeremy Hunt said that reducing state handouts would send a 'very important cultural signal' to Britons about the importance of work
Benefits cuts will force people to work harder like the Chinese, Jeremy Hunt claimed today as tensions grew in the Tory party over changes to tax credits.
The Health Secretary, who has a Chinese wife, said that reducing state handouts would send a 'very important cultural signal' to Britons about the importance of work.
The government faces claims the move will leave 3million families more than £1,000 worse off, including many who are in work.
Labour sought to fan the flames today by publishing a list of Tory MPs in 25 marginal seats where 130,000 working families will be left out of pocket.
The independent Institute for Fiscal Studies has warned that 13 million families will lose an average of £240 a year when the cuts come into effect in April.
The government claims that tax cuts, free childcare and the new National Living Wage will make up the shortfall for the vast majority of those affected.
Senior ministers are adamant they will not back down, insisting that people will have to work for a few more hours to make up the shortfall.
Mr Hunt, speaking at a fringe event at the Tory party conference, said the welfare changes would strengthen the nation's work ethic.
'We have to proceed with these tax credit changes because they are a very important cultural signal.
'My wife is Chinese, and if 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 that we have to answer which is essentially: are we going to be a country that 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 culture where work is at the heart of our success.'
Mr Hunt added: 'The hard cash argument I don't entirely buy because I don't think it takes into account the dynamic effect, it doesn't take into account the extra hours that people work, 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 were previously being paid.
'So 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 are 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.'
However, a number of senior Tories including London Mayor Boris Johnson and former minister Lord Willetts have warned the tax credit cuts go too far and will mean that people in work are punished.
Opponents of the plan hope that enough Tory rebels will vote against the cuts to wipeout the slender Tory majority of just 12.
The Labour party released details of the 25 Tory MPs with the smallest majorities, and then numbers of families in their area affected by the cuts.
For example, Byron Davies won Gower by only 27 votes but there are 3,600 working families receiving tax credits in his constituency.
Stewart Jackson was elected in Peterborough by 1,925 but 11,000 families will be hit.
Owen Smith, Labour's shadow Work and Pensions Secretary, said: 'The independent experts at the IFS have said that it will be 'arithmetically impossible' for people not to lose out, while around 3 million families will lose an average of £1,300 a year.
'Mr Osborne's refusal to listen to sense and back down on these cuts is an insult to working people. It leaves millions of working families dreading a letter through the post just before Christmas telling them how much of their tax credits they are set to lose.'
Chancellor George Osborne insisted that a 'typical' family with one person working full-time on the national minimum wage will be better off overall
This morning Mr Osborne insisted that a 'typical' family with one person working full-time on the national minimum wage will be better off overall, when all of the Government's changes to benefits, income tax allowances and the establishment of a new 'national living wage' are taken into account.
And he said that maintaining tax credits at their current level would force the Government to divert money away from priorities like health and education.
Mr Osborne told ITV1's Good Morning Britain: 'What we are offering ...is a new settlement where we get lower welfare bills, but we get higher wages and lower taxes too, there's help with free childcare, and we also live in a country that lives within its means and that provides security to every working family.
'That's the new settlement and we've got to get on with it if we are going to deliver a country that offers jobs and opportunity in the future.'
But Labour's former welfare reform minister Frank Field said: 'The national living wage only reaches its full £9 an hour in 2020 and the free childcare offer won't be available to those families with eligible children until 2017.
'The tax credit cuts will be imposed from April. That's the issue the Chancellor has to face.
'Even if his calculations are correct, he is still launching a dive-bomb attack on Britain's strivers from April until 2020.'
UNISON General Secretary Dave Prentis said: 'The government is on the back foot over tax credits and ministers know it.
'They keep saying that families will be better off, but figures published by the House of Commons Library, and a host of other organisations, tell a very different story.
'The reality is that the incomes of almost three million working households will take a huge hit next April as the tax credits they rely on to get through each month are taken away.'
|MP||Constituency||Majority||Working families |
receiving tax credits
|Amanda Solloway||Derby North||41||5,800|
|Gavin Barwell||Croydon Central||165||6,500|
|James Davies||Vale Of Clwyd||237||4,400|
|David Nuttall||Bury North||378||5,400|
|Andrea Jenkyns||Morley & Outwood||422||5,000|
|Oliver Colvile||Plymouth Sutton & Devonport||523||5,800|
|Simon Kirby||Brighton Kemptown||690||4,700|
|David Mundell||Dumfriesshire Clydesdale & Tweeddale||798||4,200|
|Chris Green||Bolton West||801||4,900|
|Graham Evans||Weaver Vale||806||4,100|
|Johnny Mercer||Plymouth Moor View||1,026||6,400|
|Luke Hall||Thornbury & Yate||1,495||3,200|
|Craig Williams||Cardiff North||2,137||3,100|
|Royston Smith||Southampton Itchen||2,316||5,500|