HC Deb 22 March 1973 vol 853 cc648-9
23. Mr. Meacher

asked the Chancellor of the Exchequer what is the value of the total gain in the Budget to workers earning less than £25 a week.

Mr. Patrick Jenkin

The zero-rating of children's clothes and shoes and of purchase tax foods, together with the reduction of national insurance contributions for those with less than £24 a week, will help the low-paid. It is not possible to quantify the benefit for any particular income group.

Mr. Meacher

Is the Minister aware that low-wage earners did not get from the Budget any increase in the tax threshold in respect of the 13 per cent. increase in money earnings last year? Is he further aware that before next year's Budget the tax threshold on current trends will have fallen to an all-time low of about 53 per cent. of average earnings, which makes nonsense of any claim of fairness to low-paid workers?

Mr. Jenkin

What makes nonsense of the hon. Gentleman's question is that while his Government were in office tax thresholds fell, in real terms, by 12 per cent. Since this Government have been in office, tax thresholds have risen by 81 per cent. in real terms.

Mr. Peter Rees

Will my hon. Friend confirm that a married man with two children with an income of £20 a week was paying tax at the rate of £1 a week in 1970–71 as a result of the Labour Government's tax measures, whereas he has been completely relieved of tax by the two Budgets of my right hon. Friend?

Mr. Jenkin

I am happy to accept my hon. and learned Friend's expertise in these matters.

Mr. Pardoe

Will the Minister please remember that it is not good enough to excuse his Government's performance by pointing a finger at the Labour Government's performance, which was not very good either? Will he accept that all our partners in the Common Market have found that family allowances are the only satisfactory way to help the low-paid families, and that the Government must redeem their promise to increase family allowances?

Mr. Jenkin

I am sure that the hon. Gentleman recognises that in working out and publishing our proposals on the tax credit scheme we are ahead of the rest of the world, and that this system will give the greatest help to the low-paid, the pensioners and others who will benefit from it.