Cameron freaks out over Lords’ plan to block tax credit cuts

Peers in the House of Lords are planning to block the government’s proposed cuts to tax credits in a vote next week and Conservatives in the House of Commons are threatening to suspend the Upper House in retaliation.

Next Monday, the Lords will be voting on a Bill of tax credit cuts, after the Commons voted in favour of the cuts this week. In ordinary times, the upcoming Lords vote would be a formality – aware of their limited constitutional rights, the Lords would normally wave the government’s plans through.

But these are extraordinary times. The government’s unprecedented attack on society’s most vulnerable has caused unease even in Tory ranks, and horror in the other parties. So three peers – Liberal Democrat, Labour and crossbench – have tabled motions to oppose the cuts.

The Lib-Dem’s motion is a “fatal motion”; if passed, it will kill the Bill altogether.

Fatal motions are extremely rare; only a handful have successfully passed since World War II. But Lib-Dem leader Tim Farron is instructing peers to support the fatal motion, and if Labour peers join them, the tax credit cuts will be dead in the water.

Could it happen? Well, the Lords show all the signs of being in a rebellious mood. Just last night, Labour and Lib Dem peers united to vote down the government’s plan to scrap onshore wind subsidies early.

And Cameron certainly seems to be panicking. “Government sources” have briefed The Huffington Post that he will suspend the House of Lords or fill it with Tory peers if the Upper chamber goes against his will, and Cameron himself told the Commons:

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This House has now decided twice in favour of this measure … I think the House of Lords should listen to that very carefully and recognise that it’s for this House to make financial decisions.

Cameron is referring to the convention that the House of Lords does not normally challenge major financial measures. But the government is being hoist with its own petard here; instead of putting the tax credits cut forward as part of the Finance Bill, the Chancellor of the Exchequer, George Osborne, decided to ram it through in regulations, which are subject to less scrutiny in the Commons, but which have to go through the Lords.

There is also a convention that the Lords lets the government pass laws that were in its last General Election Manifesto. But the Bill will get no help from that direction as tax credit cuts were of course not in the Conservative Manifesto. On the contrary, the Prime Minister explicitly promised not to cut them.

According to the BBC’s James Landale, peers would therefore be constitutionally in-the-clear if they voted for the fatal motion:

As for the officials and clerks in the House of Lords, they are rather caught in the middle. They are clear that all the options open to peers on Monday are legitimate from a constitutional point of view. But they equally admit that all the options would have substantial political consequences.

So now millions of society’s most vulnerable people are depending on an anachronistic House of unelected peers to defend them from the elected government’s austerity politics. It is an extraordinary situation – but if Cameron is frightened by it, he has only himself to blame.

Featured image via World Economic Forum/Wikimedia Commons