Working tax credit changes hit 200,000 households

Ministers said large proportion would be able to work extra hours to qualify, but figures suggest 5% managed to do so.

More than 200,000 low-income families have lost working tax credit payments of up to £73 a week, Treasury figures confirm.
Changes introduced on 6 April required claimant households to work at least 24 hours a week to qualify for tax credits, up from 16 hours a week. Government snapshot estimates showed 212,000 couples would be affected, but ministers argued that “a large proportion” would be able to persuade their employers to increase their hours.
Official figures released in response to a parliamentary question on Tuesday show that on 1 April, 203,000 households were still working between 16 and 24 hours a week, suggesting 5% of those affected were able to get extra hours while almost all the remainder lost out.
Unions and charities had described the changes to working tax credits as a “ticking timebomb” and lobbied ministers to postpone the reform on the grounds that the dire economic climate would make it hard for employers to offer extra hours.
In March the Usdaw union calculated that two-thirds of families affected by the cuts were already on or below the poverty line, with annual incomes of less than £17,000. Losing working tax credits would mean some would be better off on out-of-work benefits, it said.
John Hannett, the Usdaw general secretary, said: “The government defended its shameful attack on working couples trying to do the right thing by insisting they would be able to get extra of hours of work. The government’s own figures released today blow that claim out of the water.
“The government’s decision to ignore the advice of Usdaw, businesses and charities that substantial numbers of families would face severe hardship, debt and even the loss of their homes, shows how out of touch they are both with economic reality and with the appalling hardship their policies are causing.”
The Treasury said there had been “eligibility loss around working tax credits” on 1 April but said the vast majority of affected households would be better off as a result of its wider tax and benefit changes.
A spokesperson said: “We’ve had to take tough decisions, such as on tax credits, but have done so in the fairest way possible, meaning more than 15 times as many people gain rather than lose from the recent changes.”



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