Adam Smith Institute

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Press Release: Conservative Manifesto a mixed bag for workers (minimum wage, housing and childcare)

For further comments or to arrange an interview, contact Head of Communications Kate Andrews: kate@adamsmith.org | 07584 778207 Commenting on the Conservatives' pledge to keep minimum wage earners out of income tax, Director of the Adam Smith Institute Dr Eamonn Butler said:

It’s been an absurd part of UK tax policy that people making the minimum wage have had their earnings taxed away. The Conservatives should be applauded for making a firm commitment to keep those on the minimum wage out of income tax, regardless of future rises to the minimum wage.

However, to truly take the lowest-paid out of tax, the Tories would do well to reevaluate the National Insurance threshold, which goes into the same revenue pot as income tax yet continues to sit far below the personal allowance threshold.

Commenting on the Conservatives' housing pledge, Dr Butler said:

The Tories are right to put the UK's housing crisis at the heart of their manifesto and to prioritise giving low-earners the opportunity to buy their own home. But a £1 billion fund for Brownfield regeneration won't come close to supplying Britain's needed, and missing, homes.

The only way to create long-term affordable housing is to liberalise the planning system and allow for millions of houses to be built where people actually want to live. Building on just 0.5% of the UK’s Green Belt , for example, would be enough to fulfil UK housing needs for the next decade (though building on 1% of England's Green Belt would fully fix Britain's housing market by bringing prices down as well creating supply).

Commenting on the Conservatives' childcare pledge, Head of Communications Kate Andrews said:

The cost of childcare is unaffordable for many families, but it's government funds that are perpetuating the distorted and expensive childcare market. Providing more childcare benefits will only exacerbate the problem.

Ofsted regulations around childcare are some of the harshest in Europe, and it’s those requirements, including stringent qualification requirements and low mandatory child-to-staff ratios, that have caused prices to skyrocket.

"The Tories' commitment to more childcare spending will probably just reenforce the vicious cycle of high costs; to truly tackle the price of childcare, the sector must be deregulated.

Notes to editors:

For more information, read ASI report "The Green Noose: An analysis of Green Belts and proposals for reform", which looks at the Green Belt’s impact on England’s housing shortage.

The Adam Smith Institute is an free market, libertarian think tank based in London. It advocates classically liberal public policies to create a richer, freer world.