Home > News > Articles & speeches > Why tax credits matter

Next week, we will see the Chancellor delivering his budget speech – with decisions that will affect people up and down the country. With this in mind, I recently challenged the Wales minister, Alan Cairns MP, to come clean on whether the Government is intending to cut child tax credits in the budget. Not only did the Minister give no reassurance on tax credits, but he clearly chose not to understand the importance of child tax credits in our current taxation system – in providing families who are in work but on below average incomes with additional support to help them provide for their children. To describe protecting child tax credits as a “wrong priority” as he called it, whilst his Government pushes through laws to prevent any income tax increase for millionaires is a real kick in the teeth for working people. Over half of all families with children in Wales currently rely on child tax credits to help them make ends meet. Of course, one way of decreasing reliance on tax credits would be to have larger increases in the minimum wage –so that we are not effectively subsidising employers, but that has to be done in a planned and systematic way so businesses can plan ahead – and the Chancellor has not even met his own target yet of raising the minimum wage to £7. We have called a debate this week, especially to highlight the importance of child tax credits – in providing support for parents who are doing their best, juggling work, often in several low paid jobs, with looking after their children – in the hope of influencing the Chancellor’s budget.

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