The Chancellor’s Spring Statement was full of nakedly political tax moves but failed entirely to target support to help with the cost of living emergency, SDLP finance spokesperson Matthew O’Toole has said.
O’Toole pointed out that much of the value of the landmark announcement – the increase in the earnings threshold for employee National Insurance contributions - will be wiped out by the combination of the ending of the Universal Credit uplift as well as the coming rise in the headline National Insurance rate.
Meanwhile, Rishi Sunak used up huge amounts of fiscal headroom by scheduling in a £6 billion a year income tax cut not targeted at working families or the lower paid, but rather at all income tax payers – meaning it will help wealthier earners ahead of an election.
The Office for Budget Responsibility’s forecast document – also published today - highlighted how little the Chancellor’s measures are doing to help with the cost of living emergency, with the worst living standards squeeze for decades projected, despite the measures announced today.
South Belfast MLA Matthew O’Toole said:
“The Tory Government had the chance to do something serious to help with the cost of living but Rishi Sunak chose to play to the Tory tax cutting gallery. Rather than focus his tax cuts on those who most need them, he scheduled in billions of tax cuts which will help better off voters ahead of an election – rather than focusing real support on the families and workers who need it now.
"The rise in the National Insurance threshold is by itself welcome, but for many of those struggling in and out of work, it will not replace the £20 a week loss of the Universal Credit uplift. In fact, the income tax cut pencilled in by Sunak for election year costs precisely the same as the Universal Credit cut – a shameful indictment of Tory priorities and the real intent of this Spring Statement.
“And not only was there no windfall tax on the energy companies and oil suppliers making record profits, the 5p cut in fuel duty will scarcely dent the huge rises in forecourt prices – but the associated loss in revenue will no doubt be used by the Treasury to help justify public service cuts at some point.”