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Budget Resolutions and Economic Situation

A lot of things have happened that have ensured that the claimant count has not reached the levels of the past. Part of that is undoubtedly because of flexibility—people being willing to reduce their hours—and that has been supported to a significant extent by the tax credits system, which has ensured offsetting payments if income is reduced. The incomes of some 400,000 families have been increased through tax credits to offset a reduction in earned income. The hon. Gentleman makes a fair point about the operation of the means-tested system, which has been in place for a long time, but however we look at it, it is undoubtedly the case that, in employment terms, the damage from the recession that we have been through has been a great deal less than that from the recessions of the 1980s and the 1990s.