Today’s Institute for Fiscal Studies (IFS) report commissioned by the End Child Poverty report contains some bleak predictions. While the full picture will not be clear until the October spending review, the IFS has drawn some worrying conclusions about rising child poverty as a result of the future increases to VAT and other benefit cuts proposed in areas such as housing.
Changes in tax credits for families in the £40k bracket are causing concern. Faced with the forthcoming benefit changes, many will be significantly less comfortable than some may suppose. Worryingly, new figures released by the IFS suggest that the poorest 10% with children could lose up to 5% of their income. Reports suggest that those worst hit will be low income households of working age with children. It is reported that according to Treasury figures, those on low incomes will be about £180 a year worse off in two years time.
While the Treasury insists however that there will be no rise in child poverty and the Coalition remains committed to ending child poverty by 2020, the Treasury Select Committee has called for a wider analysis on the effect that the budget could cause on wealth redistribution.
It is hugely important that those from all income brackets are adequately supported to help raise their children in happy circumstances. Hopefully, the October spending review will result in brighter predictions for the kind of hard working families the Family Commission has met in abundance throughout its inquiry.