Oliver Letwin becomes first senior Conservative to call for tax increases in order to ease 'strain' on public services

'People were much more concerned than they had been at the previous two elections about spending on schools, spending on health, spending on social care'

Rob Merrick
Deputy Political Editor
Wednesday 28 June 2017 14:30
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Oliver Letwin was a senior Cameron adviser
Oliver Letwin was a senior Cameron adviser

Oliver Letwin has become the first senior Conservative to call for tax increases in order to ease the pain for cash-starved public services.

The former shadow Chancellor said the election campaign had laid bare the public’s exhaustion with ongoing austerity – admitting those services are “under strain”

It was time for “well judged and careful tax increases” to pay for better schools, hospitals and social care, while continuing to cut the budget deficit, he said.

Mr Letwin also warned that tax hikes could not be restricted to the “very rich”, adding: “One way or another, a large number of people will have to pay a little more tax.”

During the election campaign, Theresa May repeatedly refused to rule out increases in tax or national insurance, while promising more funding for education and healthcare.

And, since then, she has been forced to ditch key revenue-raising measures including means-testing winter fuel payments and ending universal free school meals for infants.

However, publicly, ministers have refused to admit that tax rises in the pipeline – falling back on the mantra that there are “no plans” for them.

Mr Letwin said Tory MPs had uncovered the voters’ growing opposition to austerity when canvassing, saying: “We all found that on the doorsteps.

“People were much more concerned than they had been at the previous two elections about spending on schools, spending on health, spending on social care.”

The comments, on BBC Radio Four’s Today programme, come ahead of a vote on the Queen’s Speech, when Labour will attempt to end austerity in the emergency services.

The Opposition has tabled an amendment to end funding cuts to the police and fire rescue services and lift the public sector pay cap to give public service workers a wage increase.

Significantly, Mr Letwin has previously been a hardline supporter of cuts, as David Cameron’s chief policy adviser.

However, the former shadow Chancellor, denied that his support for tax increases meant he was going soft on the need for the Treasury to balance the books.

Instead, he said better-funded public services and the latest fiscal target – to wipe out the deficit by 2025 – were both achievable, “if one is prepared to bite the bullet” of higher taxes.

“I’m not suggesting any change in the Chancellor’s target for that,” Mr Letwin said.

Today, Jeremy Corbyn will urge the Government to accept the public’s mood has changed, after Ms May’s general election battering.

“You can’t have safety and security on the cheap,” the Labour leader said. “It is plain to see that seven years of cuts to our emergency services has made us less safe; it’s time to make a change.

“Our emergency service workers make us proud at the worst of times for our country, such as the Grenfell Tower Fire and the recent terrorist attacks, and deserve the pay rise they have been denied for seven years.”

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