Cameron hits back over austerity

The Oxford Times: Prime Minister David Cameron says he wants to give people "a sense of economic security and peace of mind" Prime Minister David Cameron says he wants to give people "a sense of economic security and peace of mind"

David Cameron held out the prospect of using future public spending savings to fund tax cuts as he hit back at political and church criticism of tough austerity measures.

The Prime Minister said "every efficiency" found could help provide "a bit of extra cash" for hard-pressed families - enough for parents to pay for trainers or a birthday meal for their children.

And he pointed to the Government's acceptance of a recommended above-inflation rise in the minimum wage as another example of voters feeling the benefits.

In a speech just two weeks before the Chancellor delivers the Budget, he acknowledged a failure properly to explain the "values" behind swingeing cuts - including a severe squeeze on welfare.

"T oo often we've given the impression that we're just about fixing problems rather than changing things for a purpose," he conceded - including on immigration and education.

"It's not just what we are doing that matters, it's why. It's all about values.

"And the most important value right now - after a difficult time for our country - is giving people a sense of economic security and peace of mind."

Mr Cameron, who has made clear his desire to cut taxes if the Conservatives win power outright in 2015, said that security came from "having more money in our pockets".

Senior Tories are calling for the 40p income tax rate threshold to be raised in the Budget so it hits fewer workers, easing the burden on middle class voters.

They want George Osborne to raise it to £44,000 to stop people like teachers and police officers who "don't consider themselves even remotely privileged or rich" being hit.

The Liberal Democrats are pushing for the main income tax allowance to be raised to £10,500 in what Nick Clegg calls a "workers' bonus" of £100 off the bills of basic-rate taxpayers.

The Deputy Prime Minister accused his coalition partners of being "spectacularly inconsistent" on tax and said he had to drag them " kicking and screaming" to raise the threshold to £10,000.

Mr Cameron said seeking savings was " important at the best of times but it's more important than ever when families are feeling the squeeze.

"Because every bit of government waste we can cut, every efficiency we can achieve is money we can give back to you.

"A bit of extra cash that can help a dad afford those trainers for his son or help a mum celebrate her daughter's birthday with a meal out.

"Having more money in our pockets is what gives everyone that sense of financial security and peace of mind. It's what enables us to provide for our families and feel more confident about the future."

The Low Pay Commission's proposed 3% rise in the minimum wage to £6.50 from October - the first real-terms boost since 2008 - was " only affordable because of the difficult decisions we have taken", Mr Cameron told the audience at a apprenticeship event in Coventry.

"Of course, the numbers matter but what matters even more is what it means for hard working people," he added - confirming that the Government would accept it.

"It means that as we recover from the great recession, hard-working people on the minimum wage - who have suffered during the tough times - can know they will share in the recovery.

"So yes, I look forward to accepting this recommendation."

Shadow chief secretary to the Treasury Chris Leslie said: "David Cameron has revealed his true values by the choices he has made.

"He's chosen to give the top 1% of earners a £3 billion tax cut while everyone else is worse off.

"Working people have seen their wages fall in real terms by over £1,600 a year on average under David Cameron's government.

"Tax and benefit changes since 2010 have also left families £891 a year worse off."

Senior church leaders have recently joined criticism of cuts to benefits but Mr Cameron said the Government was obliged to act to cut worklessness and immigration levels.

"It's wrong to let our own people do nothing, with no purpose in their life, dependent on benefits.

"It's wrong that we open our doors and communities to such rapid levels of immigration they can't manage.

"And wrong that we ask British taxpayers to fund this situation with their hard-earned money," he said.

"Now I don't care whether you are the leader of the Labour Party or the leader of the church, this kind of failure is just wrong."

Mr Cameron conceded that the most recent immigration figures " show what a big task we still face" after a steep rise all but rendered his target to cut net migration to the tens of thousands unachievable.

"But things are starting to change," he said.

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