McDonnell offers cooperation if Osborne drops Credits Bill

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AHEAD of today’s debate in the House of Lords, shadow chancellor John McDonnell said that Labour would ‘co-operate’ in future efforts to review the Tax Credit Bill, if Osborne U-turned to drop his proposed cuts in Tax Credits.

In fact the government faces defeat in the House of Lords at the hands of a Liberal Democrat motion to scrap the proposals completely. A Labour motion proposes that the cuts should be put on hold to study the impact on those affected and at least three years of transitional help given.

McDonnell told the Andrew Marr Show on Sunday morning that he had written to Osborne to make clear that if the government changed tack now, Labour would ‘co-operate’ in future efforts to review the Tax Credit Bill, as long as it was done ‘at the right time and in the right way’.

The shadow chancellor said: ‘If the Lords do throw this out tomorrow and put it back to the government, I’ve said to him “If you change your mind, bring back a policy in which people are protected, not a political stunt but a real protection, we will not in any way attack you for that. In fact we’ll support you”.’

In his letter, McDonnell reminded Osborne: ‘It has only been three months since the Summer Budget when you chose to break the promise that David Cameron made to the British people during the election – that the Tories would not touch tax credits. We now know that you plan to cut £1,300 from over 3 million families who are in work and doing all they can to pay the bills and get to the end of each month.’

McDonnell added: ‘Now, you, me and everyone else in Westminster knows that you will have to u-turn on this issue. However, you need to do it in full. It can’t be a fudge. Not some partial reversal that scores cheap headlines, yet leaves people still worse off or lands another burden on middle and low earners or the poorest in our society. You need to drop this policy completely.’

Saying ‘sometimes you have to be big enough to admit you got it wrong and do the right thing,’ McDonnell continued: ‘So I am appealing to you to put the interests of these 3 million families ahead of any concerns you may have about losing face and ahead of petty party politics. If you do, I promise you personally and publicly that if you u-turn and reverse this decision fairly and in full, I will not attack you for it.’

With reports of the Tory cabinet being split over tax credits cuts, Education Secretary Nicky Morgan told the BBC that Labour had no ‘credible alternative’ and the ‘policy wasn’t changing’.