Foreign aid spending up, taxes could rise and pensions under threat if Conservatives win election 

700038000JS00007_School_Vis Theresa May: Foreign aid commitment 'remains and will remain'
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Foreign aid spending and taxes could increase and pensions hit if the Conservative party wins the general election, under plans announced today.

The commitments were set out in a series of public statements by Theresa May, the Prime Minister, and her Chancellor Philip Hammond on Friday and will infuriate grassroots Conservatives.

They are likely to infuriate right wing Tory MPs and ministers who want Mrs May to drop the commitment to spend a proportion of GDP on aid and cut taxes.

Mrs May committed to spending 0.7 per cent of GDP on foreign aid despite opposition from Cabinet ministers and senior Tory MPs.

Theresa May Credit: Leon Neal/Getty

The Prime Minister said at an campaigning event in her Maidenhead constituency that the commitment “remains and will remain”.

Mrs May said: “Let’s be clear. The 0.7 per cent commitment remains and will remain.

“What we need to do though is to look at how that money is spent and make sure that we are able to spend that money in the most effective way.

“I’m very proud of the record that we have of the children around the world who are being educated as a result of what the British government, the British taxpayer is doing in terms of its international aid.”

Mrs May was asked if the Conservatives will commit to the triple lock on pensions.

Mrs May said: “What I would say to pensioners is just look what the Conservatives in government have done.

“Pensioners today £1,250 a year better off as a result of action that has been taken.

“We were very clear about the need to ensure that we support people in their old age and that’s exactly what we have done.”  

Meanwhile, Mr Hammond has hinted that the Conservatives will not repeat promises made in 2015 not to increase tax.

The Chancellor told the IMF spring meeting in Washington that pledges not to increase income tax, national insurance and VAT “do constrain the ability of the government to manage the economy flexibly”.

When asked repeatedly whether the Tories will reaffirm their 2015 tax promises he said the pledges "will be different".

He said: “I’m a Conservative I didn’t come into politics because I believed in higher taxes. I believe in lower taxes. And I want to see Britain as a high skill, high unemployment, high growth, low tax economy. I say low tax, I mean sensibly taxed economy.

“So I’m not in the business of having some ideological desire to increase taxes. But I also think we need to manage our economy sensibly and sustainably.

“We need to address the remainder of our deficit. Get our fiscal accounts back in to balance and it's self-evidently clear that the commitments that were made in 2015 manifesto did and do today constrain the ability of the government to manage the economy flexibly.”

Two hours later Mr Hammond issued a fresh comment on his view on tax.

He told The Telegraph: "We are and will always be the low tax party. And Labour will always be the high tax party"

But Sir Gerald Howarth, a Tory MP and former defence minister who is standing down at the general election, said: “I think it is a mistake to enshrine it in law. 

“That any one department be ringfenced when there are so many other calls on finances, particularly in defence, at a very critical moment in international affairs when the world is very turbulent.

“It is so immoral to be spending £14billion on overseas aid – it is immoral. It is taxpayers money when social care is under pressure, NHS is under pressure, schools are under pressure.

“What are we doing – just locking ourselves [in] needlessly. 

“Nobody is saying we should scrap the aid budget but if we took the aid budget back to 2010 levels - £8billion – we would still be the third largest contributor in the world in cash terms.”

Ed Costelloe, the chairman of the Grassroots Conservatives movement, said Mr Hammond’s remarks were “electorally rather silly”.

The Chancellor had shown an “element of naivety”, he said adding: “It is possible we are being softened up for some of the effects of Brexit.”

Lord Tebbit, who was chairman of the Conservative party when Margaret Thatcher won her third election landslide in 1987, said: “It is a very bad start to the campaign to insist on increasing aid every year whilst there is not sufficient money for the NHS. It does not seem to make good politics to me."

UK Independence Party Leader Paul Nuttall said, "The foreign aid budget which is due to go up to £15 billion by 2020 is an absolute outrage. It costs the British people £30 million every single day. 

"UKIP is the only party that wants to see a drastic reduction in the foreign aid budget and to see that money spent on our NHS instead.

"We want to see British taxpayers' money spent here in our country on our own people. We are not afraid to say 'charity begins at home'".

The Liberal Democrats said the Government was "getting its betrayal in early".

Liberal Democrat Alistair Carmichael MP said:   “This is May and Hammond admitting that the cupboard is bare thanks to their disastrous hard Brexit.

“Theresa May’s refusal to guarantee the triple lock is yet another massive U-turn by the Prime Minister.

"Conservative high command is clearly in total disarray as it attempts a handbrake turn every day, including on such major issues as immigration, foreign aid and the single market."

But a key ally to Priti Patel, the International Development secretary, said that the 0.7per cent commitment went down well in LibDem marginals.

He said: "It is a vote winner in LibDem seats - there is a demographic of people who are really proud that we do this. It takes the edges off the Tory image a little bit."

There was also a risk that dropping the commitment risked allowing people to brand the Conservatives as the "nasty party", a tag which Mrs May first fought against when she was the party's chairman over a year ago.

Mrs May’s commitment on aid spending was also welcomed by George Osborne, the Chancellor.

He said on Twitter: “Re-commitment to 0.7 per cent aid target very welcome. Morally right, strengthens UK influence &was key to creating modern compassionate Conservatives.”

Ben Harris-Quinney, chairman of the Bow Group, warned Mrs May not to "take support for granted".

He said: "Whatever the polls say no political party can take support for granted and should always look beyond the short term.

"Committing to continuing to spend 0.7% of GDP on foreign aid whilst refusing to rule out tax hikes across the board is exactly the sort of manoeuvre that can turn a great victory to dust."

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