There are growing indications from the government that the way child poverty is measured will be changed in order to allow tax credits to be cut, as part of the plan to reduce the benefits bill by £12 billion.
David Cameron dropped heavy hints in a speech on Monday that he plans to cut tax credits available to low paid workers. He said he wanted to see:
“A welfare system that encourages work – well paid work.”
However, he went on to add:
“The wrong track though, is to ignore the causes, and simply treat the symptoms of the social and economic problems we face.
“Take for example the complacency in how we approach the crucial issue of low pay. There is what I would call a merry-go-round.
“People working on the minimum wage having that money taxed by the government and then the government giving them that money back – and more – in welfare.
“Again, it’s dealing with the symptoms of the problem – topping up low pay rather than extending the drivers of opportunity – helping to create well paid jobs in the first place.”
If tax credits are cut, however, this is likely to plunge more low paid families with children into poverty.