Paul Johnson, director of the Institute for Fiscal Studies,has been on BBC Radio 4's Today programme this morning reiterating the concerns, adding that "the numbers just don't add up".
People on low incomes will be significantly worse off if George Osborne's planned changes to tax credits get the go-ahead, the respected Institute for Fiscal Studies has warned.
The Chancellor believes that his higher minimum wage, now known as the National Living Wage, would help to compensate for cuts to tax credits.
But the IFS has warned that the average loss from the cuts to benefits and tax credits is £750 per year for families where one person is in work.
There are 8.4 million working age households who are currently eligible for benefits or tax credits who contain someone in paid work.
In a research publication the IFS warned: “Among this group the average gain from the new National Living
Wage, is estimated at £200 per year (in a “better case” scenario). This suggests that those in paid work and eligible for benefits or tax credits are, on average, being compensated for 26 per cent of their losses from changes to taxes, tax credits and benefits through the new NLW.”
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