Child Tax Credit Cuts

I share the concerns that many of my constituents have raised with me about proposals in the Government's Welfare Reform and Work Bill to cut entitlement to child tax credits, and I have already tabled an amendment to remove clause 11, which would limit child tax credit payments to the first two children in a family, from the Bill.
 

Low-income families have already been hit hard by changes the coalition Government made to the uprating of some working-age benefits. These included a three-year freeze to child benefit and a 1% cap on increases to child tax credit, and meant that both effectively fell in value as they failed to keep up with inflation. Because of these changes a typical working family with two children, on low pay, lost more than £500 in the last year alone.
 
Only one in five families affected by these cuts earn more than £20,000 a year, despite almost two thirds being in work. It is clear that these changes have had a disproportionate impact on the poorest families, and that the Government’s proposed four-year freeze of all working-age benefits will do the same.
 
I am particularly concerned about the Bill’s proposal to limit child tax credit to the first two children in a family. This creates a real risk that child poverty – already unacceptably high – will increase dramatically over the next few years. It is already the case that a third of the children living in poverty in the UK live in families with three or more children, and it is certain that this would get worse as a result of this change.
 
When the Welfare Reform and Work Bill came before Parliament for its second reading on 20 July, Labour moved an amendment highlighting our concerns about its implications for child poverty. Unfortunately the Tories voted our amendment down, and for that reason I could not vote in favour of allowing the Bill to advance.
 
After the summer recess the Bill will face line-by-line scrutiny by a committee of MPs, where there will be further opportunities for amendments to be made.
 
I and my colleagues will continue to work hard to improve this Bill in a way that protects children from being further victimised by Tory cuts.


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