CHILD poverty will increase under £12 billion of welfare cuts confirmed in a “hugely disappointing” spending review unveiled by George Osborne, campaigners last night claimed.
Responding to the Chancellor’s Autumn statement, John Dickie, director of the Child Poverty Action Group (CPAG) in Scotland, said the reversal of the tax credits cuts would be a “huge relief” to struggling families, but cuts to Universal Credit due to replace tax credits meant the decision amounted to “a stay of execution, rather than a full reprieve”.
Dickie said: “It was always wrong to cut support for working families in tax credits and it’s still wrong to cut help for these same families in the new universal credit that is replacing tax credits. Wider benefit and wider tax credits cuts are still going to slash family incomes and drive up child poverty.
“Spending reviews are about setting out the Government’s priorities.
“After the Prime Minister’s party conference pledge to mount an assault on poverty we are hugely disappointed that apart from the U-turn on tax credits there is very little evidence that the Government is putting its money where its mouth is when it comes to fighting poverty.”
Dickie added: “Today has also highlighted the absurdity of having a welfare cap in the first place. Unless the Government addresses the drivers of poverty – including sky-high housing and childcare costs and low pay, it will continue to be at risk of breaching its own welfare cap.
“We need to tackle the long-term drivers of benefit spending – such as low pay and high housing costs – rather than rationing decency by cutting benefits.”
The Chancellor also announced that Housing Benefit for new social tenants would be capped at same level as private sector in another set back to hundreds of thousands of families and would cut the amount spent on the benefit by £225 million a year by 2020/21.
Peter Kelly, director of the Poverty Alliance added: “Today’s announcement on tax credits is welcome, but families still remain under financial pressure.
“Families will still lose the family element of tax credit, and working-age benefits remain frozen until the end of this parliament.
“We are now at the stage where there is nothing to cut. We are hurting the most vulnerable in our society.
“Instead of taking money out of the pockets of the poorest, the UK Government should focus their energies on closing the £122bn tax gap.
“This £12bn of welfare cuts are a matter of choice, not necessity.
“There is a better way, and we believe that closing the tax gap is a part of this.”
Grahame Smith, STUC general secretary added: “Scotland’s workers, especially the low paid, will struggle to reconcile the glowing economic picture he painted with the reality of their daily lives.
“The STUC welcomes the chancellor’s climbdown on tax credits but it’s important that his decision to persist with cuts to universal credit isn’t lost in the post-announcement frenzy.
“Many low income households will still experience significant losses albeit in the slightly longer term.”
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