IDS is in trouble over his strivers’ tax – and he knows it

Unable to justify the government's decision to cut support for families, the Work and Pensions Secretary has resorted to myths.

You can tell ministers are in trouble when they start peddling distortions on the scale we've seen from Iain Duncan Smith this week. IDS is in trouble. And he knows it.

Next week, the beleaguered Work and Pensions Secretary comes to the Commons to defend the indefensible. The comprehensive failure of George Osborne's budgets has forced the independent Office for Budget Responsibility (OBR) to revise up its forecasts for the claimant count by a third of a million. That's pushed up welfare spending by an eye-watering £13bn. To pay that bill, IDS has been asked to push through a strivers' tax - more than 60 per cent of which will come from working families -  on top of the £14bn already removed from tax credits, while Britain's richest citizens get a £3bn a year tax break.

It’s unjustifiable. And IDS knows it. So this week, we've had a very muddled attempt to make up some kind of case.

First, we had a made-up story that tax credit fraud had jumped by 58 per cent. This claim lasted about as long as it took Channel 4's FactCheck to gently point out, that IDS couldn't actually add up and the sums were wrong. Then we had a new line of attack. Benefits are rising faster than earnings. Except they're not. In the last ten years wages have risen faster than Jobseeker's Allowance, and the OBR tells us wages will power ahead of inflation in the next four years.

Then Nick Clegg tried to claim Labour was being inconsistent to low paid public service workers. We back a 1 per cent pay freeze, so why not a 1 per cent benefits cap? Because we've always said that 1 per cent should be an average with a tougher squeeze for the best paid public servants to fund higher pay rises for the lowest paid.

It's all fairly desperate stuff from a government that's trying at all costs to avoid admitting that the lion's share of the savings will come from working families' tax credits. So the real question in next week's debate is this: how can the government justify cutting working families' tax credits to pay for their failure to get Britain back to work - when millionaires are being given a tax cut? Right now working people are being hit with a double whammy. Wages are stagnant and tax credits are being slashed whilst at the same time the cost of living goes through the roof as anyone who boarded a train today will tell you.

The basic truth that IDS won't confront is simple. The best way to get welfare spending down is to get Britain back to work. But his much vaunted welfare revolution is in tatters. The Work Programme is literally worse than doing nothing. Universal Credit is beset with IT problems and has already been raided to pay for rising dole bills. Now the benefit cap is being pushed to the back end of the year because it’s a mess. Next week's Welfare Uprating Bill does nothing to address any of this. It does nothing to create a single new job.

More than half of the people currently out of work have been so for more than six months but the government isn’t lifting a finger to help. The Youth Contract is nowhere to be seen and the all too predictable result is youth unemployment still hovering around a million. That's why this government should be looking at far more concerted action to get Britain back to work with ideas like Labour's proposed tax on bankers' bonuses to create a fund big enough to get over 100,000 young people back into jobs.

There will plenty more smoke and mirrors from the government over the coming months but they can't disguise the reality of this Bill. It is a strivers’ tax which hammers hardworking families. The vast majority of the households hit are in work. Those are the people this government wants to cover the cost of their failure whilst 8,000 millionaires receive a tax cut worth an average of £107,500. If this government wants a battle over fairness whilst they are taking from hardworking families to fund a tax cut for the wealthiest, Labour is ready to take it on.

Work and Pensions Secretary Iain Duncan Smith outside Number 10 Downing Street. Photograph: Getty Images.

Liam Byrne is Labour MP for Birmingham Hodge Hill, cofounder of the UK-China Young Leaders Roundtable and author of Turning to Face the East: How Britain Prospers in the Asian Century.

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Donald Tusk is merely calling out Tory hypocrisy on Brexit

And the President of the European Council has the upper hand. 

The pair of numbers that have driven the discussion about our future relationship with the EU since the referendum have been 48 to 52. 

"The majority have spoken", cry the Leavers. "It’s time to tell the EU what we want and get out." However, even as they push for triggering the process early next year, the President of the European Council Donald Tusk’s reply to a letter from Tory MPs, where he blamed British voters for the uncertain futures of expats, is a long overdue reminder that another pair of numbers will, from now on, dominate proceedings.

27 to 1.

For all the media speculation around Brexit in the past few months, over what kind of deal the government will decide to be seek from any future relationship, it is incredible just how little time and thought has been given to the fact that once Article 50 is triggered, we will effectively be negotiating with 27 other partners, not just one.

Of course some countries hold more sway than others, due to their relative economic strength and population, but one of the great equalising achievements of the EU is that all of its member states have a voice. We need look no further than the last minute objections from just one federal entity within Belgium last month over CETA, the huge EU-Canada trade deal, to be reminded how difficult and important it is to build consensus.

Yet the Tories are failing spectacularly to understand this.

During his short trip to Strasbourg last week, David Davis at best ignored, and at worse angered, many of the people he will have to get on-side to secure a deal. Although he did meet Michel Barnier, the senior negotiator for the European Commission, and Guy Verhofstadt, the European Parliament’s representative at the future talks, he did not meet any representatives from the key Socialist Group in the European Parliament, nor the Parliament’s President, nor the Chair of its Constitutional Committee which will advise the Parliament on whether to ratify any future Brexit deal.

In parallel, Boris Johnson, to nobody’s surprise any more, continues to blunder from one debacle to the next, the most recent of which was to insult the Italians with glib remarks about prosecco sales.

On his side, Liam Fox caused astonishment by claiming that the EU would have to pay compensation to third countries across the world with which it has trade deals, to compensate them for Britain no longer being part of the EU with which they had signed their agreements!

And now, Theresa May has been embarrassingly rebuffed in her clumsy attempt to strike an early deal directly with Angela Merkel over the future residential status of EU citizens living and working in Britain and UK citizens in Europe. 

When May was campaigning to be Conservative party leader and thus PM, to appeal to the anti-european Tories, she argued that the future status of EU citizens would have to be part of the ongoing negotiations with the EU. Why then, four months later, are Tory MPs so quick to complain and call foul when Merkel and Tusk take the same position as May held in July? 

Because Theresa May has reversed her position. Our EU partners’ position remains the same - no negotiations before Article 50 is triggered and Britain sets out its stall. Merkel has said she can’t and won’t strike a pre-emptive deal.  In any case, she cannot make agreements on behalf of France,Netherlands and Austria, all of who have their own imminent elections to consider, let alone any other EU member. 

The hypocrisy of Tory MPs calling on the European Commission and national governments to end "the anxiety and uncertainty for UK and EU citizens living in one another's territories", while at the same time having caused and fuelled that same anxiety and uncertainty, has been called out by Tusk. 

With such an astounding level of Tory hypocrisy, incompetence and inconsistency, is it any wonder that our future negotiating partners are rapidly losing any residual goodwill towards the UK?

It is beholden on Theresa May’s government to start showing some awareness of the scale of the enormous task ahead, if the UK is to have any hope of striking a Brexit deal that is anything less than disastrous for Britain. The way they are handling this relatively simple issue does not augur well for the far more complex issues, involving difficult choices for Britain, that are looming on the horizon.

Richard Corbett is the Labour MEP for Yorkshire & Humber.