CBI, the Confederation of British Industry, has called for childcare subsidies and tax cuts for working families to help improve their living standards.\u00a0 The business lobby group said radical ideas are needed to raise standards for families and low-income workers.<\/p>\n
The group is calling for changes to NI and an extension of free childcare and maternity pay in the immediate future \u2013 a part way gap to achieving the overall cuts of \u00a37bn that it is asking for.<\/p>\n
John Cridland, the director general of CBI, said: \u201cThe financial crisis and slow recovery have hit people\u2019s finances hard.\u00a0 Living standards will gradually improve as the economy does.\u00a0 But growth on its own will not be the miracle cure.\u201d<\/p>\n
Part of the recommended changes include a gradual increase in the threshold at which employees pay NI to \u00a310,500 over the next parliament, which would have a similar function to the current personal allowance for income tax.\u00a0 If enacted, the CBI said such a threshold would equate to \u00a3363 a year in take-home pay for households with two earners.<\/p>\n
However, Cridland also said that the measures would not amount to the government abandoning its deficit reduction plans, despite the proposed \u00a37bn cut.\u00a0 He advocated that the cuts would boost growth through additional consumer spending and generating greater future tax revenues.\u00a0 Once these benefits are factored it, the CBI estimated a net cost to the treasury of \u00a33bn.<\/p>\n
He said: \u201cTackling the deficit is an absolute priority, but I don\u2019t think it\u2019s an either\/or debate.\u00a0 We need to be more ambitious about the ways we tackle the deficit.\u00a0 Deficit reduction doesn\u2019t have to be cut and slash.\u201d<\/p>\n
Meanwhile, he rejected the idea that businesses are to blame for falling living standards.<\/p>\n
\u201cYou can\u2019t mandate increases in wages. \u00a0Wages are at the level that an employer can sustain with the business that they can generate,\u201d he said.<\/p>\n
\u201cThe National Minimum Wage is about ability to pay.\u00a0 The Living Wage is what people need to earn.\u00a0 Should companies pay the Living Wage if they are able to?\u00a0 Yes. \u00a0I would encourage them to.\u00a0 Can it ever be more than an encouragement? \u00a0No.\u201d<\/p>\n
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