TUC report comes ahead of unions pre-Budget rally in central London this evening

Tim Lezard

#Oct20 TUC Austerityfail flagGovernment welfare and tax changes, together with lower than forecast wage growth, will leave the majority of children in the UK living in families below the breadline by 2015, according to new TUC research published ahead of its A Future For Families rally in central London later today.

(Pictured: #Oct20 rally against austerity, London 2012)

It says tax and welfare reforms alone will be responsible for nearly half a million more children living in poverty.

Add in slower than forecast wage growth and the public sector wage freeze, the research found, and 690,000 more children will be living below the minimum income standard by 2015.

The TUC report A Bleak Future For Families written by Howard Reed of Landman Economics warns that tax and welfare changes, including tax credit cuts, the VAT rise and the increase in the personal allowance, will have the biggest net impact in terms of increasing the number of children whose families are struggling to make ends meet – pushing 460,000 more children below the breadline by 2015.

The current MIS for a single pensioner is £12,623, rising to £23,992 for a single parent with two children and £24,643 for a couple with one child.

The majority (54.4%) of children will be living below the MIS in two years time, says the TUC.

A Bleak Future For Families shows that nine in ten families will be worse off by 2015, with only the poorest ten per cent of households better off, and then only by a measly 57p a week.

The research comes ahead of a TUC-organised rally in central London this evening, when union leaders and campaigners will urge the Chancellor to deliver a Budget next week that prioritises jobs, growth and families.

TUC General Secretary Frances O’Grady said: “Families are suffering the tightest squeeze in their living standards in nearly a century.

“By the 2015 election, the majority of children in Britain will be living below the breadline. For any civilised society, that should be shaming.

“But while the Prime Minister says there is no alternative, the truth is that support is growing for a new approach. The Budget should start from recognising that what Britain faces is a growth, jobs and living standards crisis.

“Rather than targeting tax cuts at millionaires, cutting VAT would benefit everyone, and would help poorer households far more than raising the personal allowance.”

According to the TUC report, middle income household will be nearly £1,200 a year worse off by 2015, a 6.6% cut in their income, with the biggest single loss as a result of tax credit cuts (-£505).

While the government has justified welfare cuts by saying that they target those out of work, working families are also hit hard by government austerity policies, says the research.

Working lone parents are set to lose the equivalent of 8.2% of their total income, far more than the median household loss of 6.6%, mainly as result of tax credit cuts. Households in Wales (-7.2%) and Yorkshire and the Humber (-6.9%) will suffer the sharpest loss in incomes.


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Tim Lezard

Campaigning journalist, editor of @Union_NewsUK, NUJ exec member; lover of cricket, football, cycling, theatre and dodgy punk bands

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