An extra 20,000 children will be pushed into poverty because of changes to benefits and tax credits

The Work and Pensions Minister Esther McVey revealed the extent to which planned changes to benefits and tax credits under the Welfare Benefits Uprating Bill will affect child povery figures in a response to a question put forward by Chris Skidmore, Conservative MP for Kingswood.

The Welfare Benefits Uprating Bill, which was read for a second time in the House of Commons last week, will limit increases to most working-age benefits and tax credits to the below-inflation rate of 1 per cent, for the next three years. The current rate of inflation is above 2 per cent.

Ms McVey (right) went on to say that despite rates of benefits and tax credits rising in cash terms where subject to an uprating, because the relative poverty income line moves each year in cash terms too, some families will move below this line over the period.

She said, ‘In times of recession the relative poverty line tends to fall. In 2010-11, 300,000 children moved out of relative poverty largely due to reductions in median incomes. Absolute poverty remained unchanged. It cannot be right that we can move children out of poverty through a recession.

‘We estimate that the uprating measures in 2013-14, 2014-15 and 2015-16 will result in around an extra 200,000 children being deemed by this measure to be in relative income poverty compared to uprating benefits.’

The Work and Pensions Minister also argued that the measure of child poverty, which is based on relative income alone, is not helpful in tracking progress towards the target of eradicating child poverty.