The Tories are attempting to resurrect their scrapped tax credit cuts by the back door, as figures reveal the impact of cuts to in-work benefits through the new Universal Credit, which is designed to integrate six benefits, including in-work tax credits.
Next year a single mother of two in Scotland working full time on the minimum wage would be an average of £2,981 a year worse off if she is on Universal Credit, than someone in identical circumstances on tax credits.
A Scottish single mother-of-two working full time on the UK’s version of the National Living Wage of £7.20 per hour will be £3,321 a year worse off by 2021.
Said North Ayrshire & Arran MP Patricia Gibson:
"We can now see clearly the devastating impact that the Welfare Reform agenda of the UK Tory Government will have on single parents working in Scotland as tens of thousands of Scottish families on Universal Credit will be worse off.
“The aim behind UK Government plans that ‘work always pays’ is laudable one. Chancellor of the Exchequer George Osborne has undermined it with cuts to the in-work part of Universal Credit. Even the government’s own advisers have warned Mr Osborne that he risks destroying the incentive to work.
“Originally, the Tories planned to allow people on Universal Credit to keep 45p of every extra £1 they earn. This has now been slashed to 35p. The Social Mobility and Child Poverty Commission among many others have called on the UK Government to reverse this cut and he should do. If not, he will only deepen inequality and increase hardship for people working to escape the poverty trap.”
The Institute for Fiscal Studies has said that across the UK, 2.6 million working families on Universal Credit will be £1,600 a year worse off due to the cuts to the work allowance in the benefit.