He told everybody, in his Autumn Statement, that he was scrapping his cuts to working people’s incomes. In fact he offered only a partial reversal.
The headlines went out, people heard him say “the simplest thing to do is not to phase these changes in but to avoid them altogether”, and that’s what they believed.
In fact, it turns out Gideon didn’t do “the simplest thing”. He just mentioned it in passing.
And everybody was wrong-footed, including the mainstream media (not that they’d have complained, being a gang of Tory-supporting lickspittles).
Now we’re all rushing to rectify the record.
But will the general public even notice?
Labour has released research showing how new claimant families will get lower in-work benefit entitlements when tax credits are replaced by the universal credit benefit system.
Owen Smith, the shadow work and pensions secretary, said research commissioned from the House of Commons library shows that next year, thousands of working families will be up to £2,500 a year worse off as a result of the government’s cuts to universal credit.
“It is now quite apparent that the chancellor only offered a partial reversal of his cuts to working people’s incomes in last week’s statement. Next year, half a million families may be hit by cuts to tax credit’s successor, universal credit,” said Smith.
“This newly commissioned research shows that working families on universal credit still face devastating losses next year. A 23-year-old single parent with two children, working 30 hours a week on the minimum wage, is set to lose £2,500.”
Both the Institute for Fiscal Studies (IFS) and the Resolution Foundation thinktanks last week said they believe millions of working families will be worse off by 2020 because of welfare changes than they would have been under the current system.
There are 2.6 million working families who stand to lose an average £1,600 as a result of benefit changes due to come into force under universal credit, while 1.9 million would be £1,400 better off, the IFS noted.
It stressed that no family will take an immediate cash hit, but the “long-term generosity of the welfare system will be cut just as much as was ever intended, as new claimants will receive significantly lower benefits than they would have done before the July changes.”
The Resolution Foundation said the changes will cost working households £1,000 on average in 2020 and the losses could rise to £3,000 for some families.
However, the Treasury and the Department for Work and Pensions hit back at the independent studies, saying it was “completely misleading” to suggest families would lose money, because the universal credit rates will only apply to new claimants.
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