Poor Families with Children Lose Out

Stuart Weir, 2015 Jan 30
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Homeless or not, children from poor families have short, poor lives

Low income households with children and the very rich have lost the most from the coalition government’s tax and benefit changes, according the Institute for Fiscal Studies. [Presumably the very rich won’t really notice! Ed.]

The tax changes and cuts to benefits brought in by the coalition government have had less impact on middle-income families, but families with children have been affected more than child-free households.  Low income families have lost the most as a percentage of their income, mainly as a result of cuts to benefits.

Households have lost an average of £489 a year from coalition changes, but including the tax rises introduced in April 2010 increases this average loss to £810 annually. According to the IFS, childless households have had a mean gain of £199 each from the changes brought in since 2010. However, households with one child have lost £648 and households with two children have lost £1,202.

The changes to benefits and tax means that middle-income working-age households without children have gained the most from the coalition’s changes, because of large increases in the income tax personal allowance. They are also much less affected by benefit cuts.