Published in South Wales Evening Post 26-10-2016
Working Tax Credits and Child Tax Credits were introduced by the Labour government, back in 2003. They provide vital top-up support to hard-working families whose incomes are not able to cover the basic costs of living: food, housing, energy bills and the like. If we had a real living wage in this country that was being paid to everyone in full or part-time employment, then of course there'd be no need for tax credits, because everyone's take-home pay would be enough to cover their costs.
But the fact of the matter is that millions people across the UK are obliged to claim for tax credits, just so that they can make ends meet. When Gordon Brown introduced tax credits in 2003 they were only intended for a small section of the workforce, and for the first few years that was the case. But ever since the Tory-led coalition government got into power in 2010 we've seen cruel attacks on the 4.5million people who receive tax credits, 4million of whom have children.
Tax Credits have played a critical role in the biggest improvement in child poverty since the war, when the number of children living in families below the poverty line fell from 35% of the child population to 19%. This good work is now at risk. That's the price we're paying for the low-wage, low-skill economy that this government has created.
In May 2014 the government appointed a company called Concentrix to oversee the process for claiming tax credits, with clear instructions to 'crack down' on the slightest suspicion of fraudulent claims. Now, I have no problem at all with that, in principle. It's absolutely right that we ensure that the only people receiving any sort of social security payments are those who have the right to do so. But the way in which Concentrix has set about its task, based on instructions from Government, has been an unmitigated disaster. Since September I have had 11 constituents bring their complaints to me, and the number is growing every day. Here are just a few examples, to show how callous, absurd and dysfunctional the system has become:
Concentrix alleged that Samantha Rowlands was living with a woman, when she submitted evidence proving otherwise Concentrix focused instead on a ‘Rowlands’ being paid in her bank statements. They alleged this was her husband but it was her mother, whose bills Samantha handles. Samantha had to pawn her late father’s jewellery just to be able to put food on the table.
Jackie Harris had her tax credits stopped after her income was submitted and the system worked out she had to be working less than 16 hours. Ms Harris attached a letter from her employer and her employment contract explaining why, but this was ignored. She has not received a payment for 15 weeks.
Kirsty Wade’s tax credits were stopped after Concentrix alleged she was living with somebody. They had seen mail being sent to her address with a different name on it. The mail was addressed to her landlord who picks up the mail from the address once a week. Ms Wade was without payments for weeks on end.
It is degrading to not be believed and trusted, to be considered to be cheating the system, especially when evidence and sound reason to the contrary are given. When someone is working hard to make ends meet, it is deeply insulting and demoralising to have the floor unjustly ripped out from under them. And let’s be clear, Concentrix is just the messenger here. The problem starts with the Government’s ‘pay by results’ approach, which incentivises contractors like Concentrix to behave in such harsh and inhumane ways.
My constituents have been frustrated, angered and humiliated by this, and it has to stop. I have written to the Chancellor, Philip Hammond, and I will continue to press for change in Parliament. Fortunately the message seems to be getting through, as Concentrix was given the boot over the summer, asked to complete outstanding cases but take on no new ones. The knock-on effect of that is that hundreds of staff have had to be hired by The Revenue, no doubt at huge cost to the taxpayer. So, the government's new approach was supposed to save money, but in fact it will probably end up costing millions - talk about a false economy!
Theresa May claims that she wants to build 'a country that works for everyone', and yet her government is undermining some of the basic standards of civilised behaviour that are supposed to hold our country together. There is no excuse for it, and no reason for it either. Let's hope that lessons are learned, and that from now on common sense and common decency will prevail.