Welfare reforms will consign millions of working families to poverty, warns TUC

Responding to the Prime Minister’s speech on welfare in Runcorn today (Monday) TUC General Secretary Frances O’Grady said: “Today the government has smashed the myth that it is the party for blue-collar workers. Tax credits play a vital role in making sure the UK’s working families are better off in work. Cutting this crucial benefit will consign millions of hard-working families and their children to living on the poverty line. “Even if they secured decent pay rises well above the minimum wage, as well as income tax cuts, millions of working households would still rely on tax credits to survive. The best way to make work pay for families is to deliver better wages while protecting tax credit entitlements. “The Prime Minister had nothing to say about how he will improve pay and conditions for people at work. All we heard today is that he is planning to drive family incomes down by slashing the tax credits which give working people vital help to bring up children. The test of his reforms will be whether working families find themselves better or worse off - from what we heard today it sounds as if those in low-paid work will soon be feeling even worse off than they do now.” NOTES TO EDITORS: - TUC research has previously modelled the impacts for low-paid families of pay increases, showing that while pay rises are vital, and that income tax cuts can also deliver small gains (although not for those who already earn below £10,600 and no longer pay income tax), even when earnings rise from the minimum wage to the Living Wage tax credits continue to provide vital support, particularly for low-paid working parents: www.tuc.org.uk/social-issues/welfare-and-benefits/tax-credits/tax-credi… - All TUC press releases can be found at www.tuc.org.uk - Follow the TUC on Twitter: @tucnews