According to a report carried out by the Institute for Fiscal Studies, commissioned by the Family and Parenting Institute, families with children will find the coming years financially straining as the Government’s tax and benefit reforms are implemented. Even working parents will be hit hard as they will lose a significant part of their income.
Coupled with the Government’s employment law reforms, employees are likely to not only struggle with increased job insecurity but also with benefit cuts. According to the report, a family with two children will, annually, be £1,000 worse off.
Certain family structures will suffer more than others according to the report. Amongst the worst affected will be families with children under the age of five, families with more than two children, and unemployed single parents.
However, out of all the groups single unemployed parents will take the hardest hit as they will lose £2,000 of their annual income. The report highlighted that this reality, encountered by many single parents, is a "very real concern" as they will struggle with finding jobs that can cover their childcare costs and offer flexible working times.
According to a Government spokesman, MPs are doing what they can to help families whilst getting the UK economy back on track. “The Prime Minister acknowledged that families are facing difficult times so the Government has taken practical steps to help them - cutting fuel duty, freezing council tax and cutting income tax for millions. The Chancellor also confirmed working-age benefits will go up by 5.2% in April and increased the child element of the child tax credit in line with inflation.”
Katherine Rake, Chief Executive of the FPI, said, “These figures reveal the full extent to which families with children are shouldering the burden of austerity. Having children has always been expensive. But now many families with children face an extra penalty of more than £1,000.
“It is particularly surprising to see that some of the most vulnerable groups – such as families with new babies and lone parents out of work– are bearing the brunt of the tax and benefit reforms.”
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