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| Budget does nothing for 600,000 more children in poverty, campaigners say | Budget does nothing for 600,000 more children in poverty, campaigners say |
| (17 days later) | |
| Britain's poorest families have been abandoned on the frontline of austerity, say campaigners who claim the budget has failed to change the fact that 600,000 more children will move into poverty during the coalition's time in office. | Britain's poorest families have been abandoned on the frontline of austerity, say campaigners who claim the budget has failed to change the fact that 600,000 more children will move into poverty during the coalition's time in office. |
| "The chancellor described it as a budget for families, with children, looking to work hard and aspiring to get on," said Alison Garnham, chief executive of Child Poverty Action Group (CPAG). "But most low-income families have very few reasons to be cheerful and plenty to be fearful." | "The chancellor described it as a budget for families, with children, looking to work hard and aspiring to get on," said Alison Garnham, chief executive of Child Poverty Action Group (CPAG). "But most low-income families have very few reasons to be cheerful and plenty to be fearful." |
| Raising the personal tax allowance, from £8,105 to £9,440 next month and to £10,000 from April 2014 does little for the million lowest paid workers, Garner argued. "Some don't pay tax anyway, while others keep just 15p in every extra £1 because their in-work benefits like housing benefit get withdrawn," she said. | Raising the personal tax allowance, from £8,105 to £9,440 next month and to £10,000 from April 2014 does little for the million lowest paid workers, Garner argued. "Some don't pay tax anyway, while others keep just 15p in every extra £1 because their in-work benefits like housing benefit get withdrawn," she said. |
| The new package of childcare support for working families, due to be introduced from autumn 2015 after the next general election, will also do little for struggling low-paid parents. | The new package of childcare support for working families, due to be introduced from autumn 2015 after the next general election, will also do little for struggling low-paid parents. |
| The package includes cover of up to 85% of childcare costs for parents receiving support through tax credits but will only be offered where a lone parent or both earners in a couple earn enough to pay income tax, leaving lower earners out. It will also provide childcare support of £1,200 per child for families not on tax credits or state benefits where both parents earn up to £150,000. | The package includes cover of up to 85% of childcare costs for parents receiving support through tax credits but will only be offered where a lone parent or both earners in a couple earn enough to pay income tax, leaving lower earners out. It will also provide childcare support of £1,200 per child for families not on tax credits or state benefits where both parents earn up to £150,000. |
| "It's a great disappointment for struggling families that the majority of extra funds for childcare will be going to the wealthiest families," Garnham said. | "It's a great disappointment for struggling families that the majority of extra funds for childcare will be going to the wealthiest families," Garnham said. |
| "The real challenge is to make childcare affordable for those at the bottom end, so there are strong incentives for second earners and single parents to work. That would do much more to help reduce child poverty and would help economic recovery too." | "The real challenge is to make childcare affordable for those at the bottom end, so there are strong incentives for second earners and single parents to work. That would do much more to help reduce child poverty and would help economic recovery too." |
| Fiona Weir, chief executive of single parent charity Gingerbread, said: "While we welcome the government's investment in childcare, 2015 feels like a very long time to wait for low-income single parent families, who may not have a car, a 5% house deposit or a fondness for beer, but who are struggling to pay their bills and put food on the table today." | Fiona Weir, chief executive of single parent charity Gingerbread, said: "While we welcome the government's investment in childcare, 2015 feels like a very long time to wait for low-income single parent families, who may not have a car, a 5% house deposit or a fondness for beer, but who are struggling to pay their bills and put food on the table today." |
| Previously announced plans for welfare benefits, rubber-stamped by the chancellor to take effect from 6 April, will add to the pressure on low-income families and push more children into poverty, say campaigners. | Previously announced plans for welfare benefits, rubber-stamped by the chancellor to take effect from 6 April, will add to the pressure on low-income families and push more children into poverty, say campaigners. |
| For the next three tax years starting this April, most key benefits and tax credits will rise by just 1% a year – below projected inflation and amounting to a 4% real terms cut – while some have been frozen altogether. This will directly push 200,000 children into poverty over the period, according to the government's own analysis, say campaigners. | For the next three tax years starting this April, most key benefits and tax credits will rise by just 1% a year – below projected inflation and amounting to a 4% real terms cut – while some have been frozen altogether. This will directly push 200,000 children into poverty over the period, according to the government's own analysis, say campaigners. |
| Child benefit rates have been frozen for a third year running at £20.30 per week for the first child and £13.40 for each subsequent child. Until January 2013, this was a universal benefit paid at the same rate to all families with children regardless of income. But since January it is not paid to families where one earner earns above £60,000 and is recovered on a sliding scale via income tax where one earner earns £50,000-£60,000. | Child benefit rates have been frozen for a third year running at £20.30 per week for the first child and £13.40 for each subsequent child. Until January 2013, this was a universal benefit paid at the same rate to all families with children regardless of income. But since January it is not paid to families where one earner earns above £60,000 and is recovered on a sliding scale via income tax where one earner earns £50,000-£60,000. |
| Key elements of tax credits will not rise at all in the coming tax year including the basic element of the working tax credit (WTC), which stays at £1,920, and the family element of the child tax credit (CTC), stuck at £545. | Key elements of tax credits will not rise at all in the coming tax year including the basic element of the working tax credit (WTC), which stays at £1,920, and the family element of the child tax credit (CTC), stuck at £545. |
| From 6 April, the child element of CTC rises by £30 a year (57p a week) to £2,720, and the disabled child element goes up by £65 to £3,015 a year. The severely disabled child element rises by £30 to £1,220. | From 6 April, the child element of CTC rises by £30 a year (57p a week) to £2,720, and the disabled child element goes up by £65 to £3,015 a year. The severely disabled child element rises by £30 to £1,220. |
| The maximum that claimants can be paid for the childcare element of WTC is frozen for the coming tax year. Currently this pays up to 70% of childcare costs provided by a registered childminder, nursery, out-of-school club or other approved provider. The percentage paid depends on income, subject to maximum limits on the weekly costs you can claim for. The weekly limit on costs for one child is £175, so the maximum payable at 70% is £122.50 a week. The weekly limit for two or more children is £300 (and the maximum claim £210). | The maximum that claimants can be paid for the childcare element of WTC is frozen for the coming tax year. Currently this pays up to 70% of childcare costs provided by a registered childminder, nursery, out-of-school club or other approved provider. The percentage paid depends on income, subject to maximum limits on the weekly costs you can claim for. The weekly limit on costs for one child is £175, so the maximum payable at 70% is £122.50 a week. The weekly limit for two or more children is £300 (and the maximum claim £210). |
| Both tax credits and most main means-tested benefits will eventually be replaced by a single universal credit payment for those of working age, with a national rollout from October 2013 to 2017. | Both tax credits and most main means-tested benefits will eventually be replaced by a single universal credit payment for those of working age, with a national rollout from October 2013 to 2017. |
| The current tax credit calculation is complicated. The total tax credits an claimant is eligible for (varying from individual to individual), are reduced by 41p for every £1 a claimant earns over £6,420 – another figure frozen for the coming tax year. The government online calculator at gov.uk/tax-credits-calculator gives an idea of what claimants qualify for. | The current tax credit calculation is complicated. The total tax credits an claimant is eligible for (varying from individual to individual), are reduced by 41p for every £1 a claimant earns over £6,420 – another figure frozen for the coming tax year. The government online calculator at gov.uk/tax-credits-calculator gives an idea of what claimants qualify for. |
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