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Tax credits row

Tax credits row
Labour has defended its system of tax credits following a scathing attack by Iain Duncan Smith.

Writing in the Daily Telegraph today, the Work and Pensions Secretary claimed the system promoted dependency while also "haemorraghing money".

He accused Labour of deliberately increasing tax credits before general elections in a "calculated attempt to win votes".

He also said that incorrect and fraudulent claims for the payments had cost the public purse £10bn.

Hitting back today, Shadow Exchequer Secretary Catherine McKinnell said: "This cheap political attack on the whole tax credits system will not succeed in acting as cover for the Government's cuts to tax credits which will hit millions of striving working families next year."

She also queried the amount that he was claiming fraud cost the Exchequer.

"I question the £10bn figure. I’d like to see how much of that was actually recovered by HMRC in terms of overpayments and underpayments because of the estimated manner in which it is based," Ms McKinnell told Sky News.

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