Labours welfare policies

It has become an unspoken known that the 2015 general election would rely purely on which party had the strongest economic policy. However, Labour at its party conference in Brighton has tried to turn the tables and turn the clamour for power into a debate on childcare and living standards. De ja vu perhaps? Reminiscent of Blair’s plans to eliminate poverty and introduce a system of tax credits? Lest we forget measures such as the minimum wage, sure start and the new deal.

Shadow home secretary Yvette Cooper has announced that Labour will offer parents of primary school children guaranteed access to childcare from 8am to 6pm. As part of proving Labours commitment to those struggling with falling living standards, Miliband also gave a firm commitment that a future Labour government would abolish the controversial bedroom tax. Latest evidence of a growing economic divide came as figures showed that UK living standards had dropped to their lowest in a decade after average real incomes fell a further 3% last year. The IFS has said the median income for people in their twenties had not grown in the years between 2001-2008 whereas pensions had grown faster than any other income group (but that’s another article in itself). Labour is trying to regain ground in social policy where most people blame Labour for the fall in living standards in recent years.

As always the economic sense of these Labour policies has been questioned. Labour’s bedroom tax pledge will cost as much as £470m year, but the party said the costs can be met closing tax scams in the construction industry, abandoning the government’s shares-for-rights scheme and reversing George Osborne’s £150m tax cut for hedge funds announced in the budget in 2013. The £470m estimated savings in construction comes from a clampdown on the disguised workers scheme, whereby workers pretend to be self-employed to reduce tax.

Unsurprisingly the Lib Dems at their conference in Glasgow voted overwhelmingly to condemn the bedroom tax. Nick Clegg however, continued to defend the tax. The Coalition have already introduced changes to the way childcare and early year services will operate in the UK including tax free childcare vouchers and tax relief on childcare costs. There have also been proposed reforms to the ratio of nursery staff to students and to the level of qualifications nursery staff need.

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