'Middle class welfare' under fire
Thursday, 22 October 2009 12:00 AM
Restoring the public finances requires major cuts in "middle class welfare", a report has said.
Right-wing thinktank Reform criticised shadow chancellor George Osborne's commitment to keep child benefit, winter fuel payments and free TV licences for over-75s for middle class families.
It said the measures announced at the recent Conservative party conference in Manchester would only save £0.7 billion, only a fraction of the £31 billion it estimates middle class welfare costs the taxpayer each year.
"The most generous benefits to the entitled classes include the child benefit, child and working tax credits, retirement pension and winter fuel allowance and statutory maternity pay," Reform argued.
"Faced with the alternative of even more significant tax rises, middle class welfare must be cut back to help restore the public finances and put welfare on a more sustainable footing."
The report launched a savage attack against welfare reform, which it claimed is "stuck in a rut". It calls for a more radical programme which moves towards a smaller system.
"The only alternative is to continue to increase the burden on current taxpayers, which will harm prospects for economic growth and postpone difficult decisions on expenditure," it warned.
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