Budget 2015: Tory tax credit cuts could hit Falkirk families

Tax credits are among the benefits to face reform
Tax credits are among the benefits to face reform

Conservative-imposed cuts to tax credits could have an adverse effect on thousands of children living in the Falkirk district and across the UK.

That’s the warning from opposition parties and charities following today’s Westminster budget statement from chancellor George Osborne, in which he promised to fulfil the Tories’ election promise to slash £12 billion from the benefits budget.

With thousands of families in Scotland struggling from week to week the absolute last people the Chancellor should target is low income families

Labour MSP Siobhan McMahon

Top-up payments given to low-income families such as child tax credit and working tax credit were, as expected, among the benefits in the firing line.

Families that have a third child from April 2017 will not receive the child tax credit element of the new Universal Credit, and overall eligibility for tax credits will be tightened to ensure only 50 per cent of families receive them.

Mr Osborne revealed all working-age benefits will be frozen for four years - including tax credits and local housing allowance, but excluding maternity pay and disability benefits.

There was good news however for low-paid workers, with a ‘national living wage’ of £9 an hour to be introduced for those aged 25 and over by 2020.

The first £11,000 of workers’ wages will also go untaxed.

More than 15,000 children in the Falkirk district are at risk from cuts to tax credits according to figures released by Central Scotland MSP Siobhan McMahon.

Cutting tax credits risks vital income to some 9000 families in Falkirk, she said.

MSP McMahon has urged the SNP Government in Edinburgh to adopt Scottish Labour plans to tackle poverty by extending the living wage and banning “rip off rent rises” in the private sector.

McMahon said: “During the general election the Prime Minister promised the ‘good life’ for families but now he plans to cut vital support for families in Falkirk and across the UK.

“With thousands of families in Scotland struggling from week to week the absolute last people the chancellor should target is low income families.

“Recently new information has shown that over 200,000 children in Scotland are living in poverty – on what planet does slashing tax credits help those kids?

“New powers coming to Scotland will help but there is so much that could be done at Holyrood now.

“With rents and poverty levels soaring in our private rented sector the SNP Government should also back Scottish Labour plans to ban rip off rent rises.”

Falkirk East MSP Angus MacDonald said: “The SNP in government has taken strong action where we can to mitigate against the worst of Westminster’s cuts – and has consistently argued for full powers over the economy and social security to allow us to create a fairer system which supports and empowers people who need help rather than punishing them as the Tories are doing.

“Unfortunately for people living in poverty in Scotland, Labour have trooped through the lobbies with the Tories at Westminster to stop full economic powers being delivered to the Scottish Parliament – meaning vulnerable people continue to be at the mercy of the savage cuts agenda of George Osborne.”