Responding to David Cameron’s appearance on The Andrew Marr show this morning, Jonathan Ashworth MP said:

“David Cameron has shown that his promises to stand up for working families are a complete farce.

“He ruled out any changes to his Government’s cuts to tax credits, which will make working families on average £1,300 worse off next April. His claims that these families will be compensated by his so-called ‘National Living Wage’ have already been rubbished by the Institute for Fiscal Studies.

“You can’t trust his promises on a seven day NHS - he has made them before but hasn’t delivered. What the Tories have done is take the health service backwards - under them it is harder to see your GP and waiting lists are higher.

“And, once again, the Prime Minister has refused to come clean about when he was informed directly by Lord Ashcroft of his non-dom status. This matter urgently needs to be cleared up.”

ENDS

Notes to editors

·         The House of Commons Library has found that the Government’s cuts to tax credits, which take effect from next April will hit almost all in-work families in receipt of tax credits. There are currently just over 3 million in-work families receiving tax credits, of whom 2.7 million have children. (House of Commons Library, September 2015, http://www.parliament.uk/business/news/2015/september/commons-debate-statutory-instrument-on-tax-credits/)

·         These families will be, on average, around £1,300 worse off next year as a result of these changes. Some families on middle-incomes will lose entitlement to tax credits altogether.

·         Those families losing out from the cuts to tax credits include earners who already earn above the minimum wage.

·         The independent Institute for Fiscal Studies has also rubbished any suggestion that the so-called ‘National Living Wage’ will compensate families hit by the cuts to tax credits. Paul Johnson, director of the IFS, has said that this is “arithmetically impossible.”

“But the key fact is that the increase in the minimum wage simply cannot provide full compensation for the majority of losses that will be experienced by tax credit recipients. That is just arithmetically impossible.”

Paul Johnson, introductory remarks, IFS post-Budget briefing, 9 July 2015, http://www.ifs.org.uk/uploads/publications/budgets/Budgets%202015/Summer/opening_remarks.pdf

·         The IFS has also shown how working families who are eligible for benefits or tax credits will only be compensated for around a quarter of their losses as a result of the ‘National Living Wage’.

“Among the 8.4 million working age households who are currently eligible for benefits or tax credits who do contain someone in paid work the average loss from the cuts to benefits and tax credits is £750 per year. Among this same group the average gain from the new NLW, is estimated at £200 per year (in a “better case” scenario). This suggests that those in paid work and eligible for benefits or tax credits are, on average, being compensated for 26% of their losses from changes to taxes, tax credits and benefits through the new NLW.”

IFS, ‘An assessment of the potential compensation provided by the new ‘National Living Wage’ for the personal tax and benefit measures announced for implementation in the current parliament’, September 2015, http://www.ifs.org.uk/uploads/publications/bns/BN175.pdf

·         In 2010, David Cameron’s spokesman said that Cameron had only found out about Lord Ashcroft’s non-dom status in February 2010.

“A spokesman for the party leader confirmed today that Cameron found out last month that Ashcroft was a “non-dom”, though it remains unclear who told him.”

The Guardian, 4 March 2010, http://www.theguardian.com/politics/2010/mar/04/william-hague-lord-ashcroft-criticism

·         But Lord Ashcroft has now said he told Cameron in 2009 and that the two had a conversation about “how we could delay revealing my tax arrangements until after the [2010] election.”

“In 2009, I discussed the matter in detail with Cameron. He was therefore fully aware of my status as a so- ‘non dom’ — the rule that allows some wealthy UK residents to limit the tax they pay on earnings outside the country.

“Indeed, we had a conversation about how we could delay revealing my tax arrangements until after the election.”

Daily Mail, 21 September 2015, http://www.dailymail.co.uk/news/article-3242581/A-broken-promise-wrote-book-LORD-ASHCROFT-reveals-went-supporter-critic-Cameron.html