Government Austerity Cuts See Families Suffer

Published on 1 January 1970 by Raffick Marday

The Government’s austerity cuts are taking effect today, with tax changes and welfare cuts to affect most areas of society.

Child Poverty Action Group warns parents of babies born from today will, as a result of benefit changes, be £1,500 worse off a year, than before the cuts.

The benefit changes will see child benefits frozen at their current rate for three years, meaning families will have less to compensate for rising inflation, and Child Tax Credit entitlements could be reduced for some families due to changes to the Family Element and Baby Element.

“Child poverty will rise as a result of these unfair cuts and the health and well being of these children will be at greater risk,” commented Alison Garnham, Child Poverty Action Group, chief executive.

“Families on a low income with a new baby should be last in line and should not face any cuts.”

The Trades Union Congress (TUC) also warns the tax credit changes could leave some families thousands of pounds out of pocket.

They state many parents may not have spotted the impact of the changes to working tax credits announced in the Emergency budget last year, and could be in for a shock when they stand to lose over £2,500 a year.

A dual earner family for example, with incomes of £25,000 and £15,000, two children (a baby and a toddler), paying £400 in childcare for 45 weeks of the year, could lose around £2,600 a year by April 2012, the TUC calculated.

“With wages failing to keep up with the cost of living and the VAT rise biting into household budgets, these tax credit cuts could not have come at a worse time for families,” said Brendan Barber, TUC general secretary.

“Many Mumsnetters are making changes to their family budgets as they find their wages aren’t going as far as they used to,” added Justine Roberts, founder and CEO of Mumsnet.

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