Stats watchdog criticises Treasury tax cut claims

Stats watchdog criticises Treasury tax cut claims

The chair of the UK’s statistics watchdog has rebuked two Treasury ministers over recent claims on tax cuts for average earners.

Sir Robert Chote said Chief Secretary to the Treasury Laura Trott risked “misleading” or “confusing” the public.

It came after she claimed in November that “taxes for the average worker will have gone down £1,000 since 2010”.

Another minister, Bim Afolami, was also criticised. Labour said the verdict was “damning”.

The Treasury has been contacted for a response.

In a letter published on Monday, Sir Robert, the chair of the independent UK Statistics Authority, said that the public would be “at least confused” by Ms Trott’s statements in the House of Commons, “which would probably suggest to a typical listener that the average worker’s overall tax bill has fallen in cash terms”.

This claim of lower taxes since 2010 is incorrect, but the figure Ms Trott refers to is a comparison to what the average tax bill would have been in 2024-25 if tax thresholds had risen in line with rising prices since 2010.

After 2010, the then Conservative-led government had a policy of raising thresholds above inflation to “take people out of the tax system”.

Since the coronavirus pandemic, that policy has been largely reversed, with thresholds frozen, taking many workers back into the tax system and higher tax brackets.

Economic Secretary to the Treasury Bim Afolami was also told in Sir Robert’s letter that he “was not as explicit… as he could have been” that a separate claim that “taxes are coming down” made on the BBC’s Today programme in January referred solely to a £450 National Insurance cut.

Listeners were unlikely to be misled, however, because the interviewer Justin Webb “immediately put this in the context of broader personal tax changes and trends”, he wrote.

The tax burden overall has significantly increased in recent years, and is set to rise to its highest level in 70 years, according to the Office for Budget Responsibility.

Sir Robert, in a reply to Labour MP Angela Eagle, said “to maintain trust and confidence in their statements, and avoid the need for subsequent clarification, ministers and other members [of Parliament] need to consider how a typical listener is likely to understand what they say”.

He said this was especially important when they “use ’round number’ talking points derived from very specific methods of calculation”.

This is not the first time that the UK’s statistics watchdog has slapped down ministerial claims about the economy.

In December, Prime Minister Rishi Sunak’s claim that the government has reduced debt was challenged by the authority.

Debt has been rising as a proportion of the economy, but in a social media post last November the prime minister said “debt is falling”.

The watchdog’s chairman said that the assertion “may have undermined trust in the government’s use of statistics”.

Ms Trott also recently got into an argument with BBC PM presenter Evan Davis on debt levels, after he asked her how the government could be sticking to its pledge to get debt down while talking about tax cuts.

The opposition called on Ms Trott to correct the record to MPs following Sir Robert’s letter on Monday.

Darren Jones, Labour’s shadow chief secretary to the Treasury, said: “The UK Statistics Authority’s verdict on Laura Trott’s comments are damning.

“The truth is working people don’t need to listen to government ministers to know they are paying more in tax. They just need to look at their payslips.”

He added: “The least Rishi Sunak can do when hammering working people with the highest tax burden in 70 years is make sure his team tell it straight.”