BRITAIN’S poorest families will suffer the most in the next recession because of cuts to welfare payments, the Institute for Fiscal Studies (IFS) warns today.
Tory changes to social security — such as universal credit, the freeze on working-age benefits and cuts to child tax credit — mean low-income households will have significantly less “insurance” if earnings fall.
The poorest households will lose an average of 53p after tax for every £1 fall in their pre-tax income when recession hits, up from 39p under the current arrangements.
Those with three or more children will be harder hit than after the 2008 financial crisis, when tax credits and in-work benefits meant that inequality actually fell.
Shadow work and pensions secretary Debbie Abrahams said: “This Conservative government has made the poorest pay for its failing austerity while allowing the wealthiest to avoid billions in tax.”