Work and Pensions
Work and Pensions
The Conservative Party has always believed in a low welfare, low tax and high wage economy. This is why we are making huge reductions to the current rates of income tax so that you will keep more of your hard earned money every month. On top of this philosophy of making it pay to work, we are introducing a Negative Income Tax system. This will provide everyone with a minimum standard of living whilst ensuring that those who work will earn more than those who don't. This is exactly the kind of incentive we want to provide in order to grow our economy. Previous Labour government reforms to private pensions wiped off hundreds of billions to the value of these pension funds. We believe that private pensions can offer more security in your retirement and this is why we will re-introduce the Advanced Corporation Tax relief to make private pensions more valuable.
Negative Income Tax
The Conservative Party will push to implement a Negative Income Tax. If you don't earn anything and are over 18, then you will get £8,000 per annum. This £8,000 will be withdrawn at a rate of £0.60 for every £1 earned via working. You will receive the negative income tax up until you earn £13,325 where you will receive £5 from the Negative Income Tax. Anything earned after that, you will no longer receive the Negative Income Tax. The Negative Income Tax will match rises in inflation to ensure that claimants are not worse off in real terms. If inflation is negative, no changes will be made to the tax.
Reforming Welfare
The introduction of the NIT policy will mean that all current benefits will be replaced, including the state pension. New benefits will be introduced however. These will be: Health Benefit and Youth Health Benefit in accordance with the Welfare Reform (Health Benefit and Youth Health Benefit) Reform Act 2016, Child Credit, Housing Credit, Employment Injuries Disablement Credit and Widowed Parent's Credit. The Child Credit and Housing Credit will be withdrawn the more you earn, similar in style to the Negative Income Tax.
Raising Wages
As a result of the Negative Income Tax policy, the minimum wage system shall be reformed. A minimum wage for each job sector will be set by the Department for Business, Industry and Skills. They will negotiate with the business and workers to formulate a fair minimum wage in their industry. The Department for Business, Industry and Skills will ensure everyone in a skilled working sector will earn a living wage.
Flexible Contracts
Our party believes that workers should have more flexibility when it comes to working hours. This is why we will propose a bill that will allow small businesses to use flexible work contracts as well as allowing workers to choose if they want a flexible work contract. Something that previous governments outlawed.
Incentivising Private Pensions
The Conservative Party wants to incentivize the use of private pensions. Hence we will restore the Advanced Corporation Tax Relief. The abolition of this tax relief wiped off hundreds of billions to private pension funds. We want to see private pension funds larger so the elderly can feel more comfortable in retirement.
