Welfare Tax Credits: Lone Parents

(asked on 9th July 2015) - View Source

Question to the HM Treasury:

To ask Mr Chancellor of the Exchequer, what discussions he has had with the Secretary of State for Work and Pensions on the potential effect of the tax credit changes announced in Summer Budget 2015 on lone parent families in which the parent works full time on minimum wage with (a) two and (b) three or more children.


Answered by
Damian Hinds Portrait
Damian Hinds
Minister of State (Education)
This question was answered on 14th July 2015

The Chancellor of the Exchequer has regular discussions with the Secretary of State for Work and Pensions on a wide range of topics.

The Government is making changes to Child Tax Credit and Universal Credit which will help put welfare spending on a more sustainable path. The Government wants to move from a low wage, high tax, high welfare society to a higher wage, lower tax, lower welfare society. That means more emphasis on support to hardworking families on low incomes by reducing income tax through increases in the personal allowance and increasing wages, than on topping up low wages through tax credits.

Parents currently on the minimum wage will benefit from the introduction of the National Living Wage from April 2016 which will be set at £7.20 per hour. The Government’s ambition is for the National Living Wage to reach over £9 by 2020. This would equate to a cash rise of £5,200 a year by 2020 for those who are currently working full time on the National Minimum Wage.

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