Tax credits 'bombshell' as over 300 couples in Wakefield set to lose £4000 a year

More than 300 families in Wakefield will lose tax credits worth almost £4,000 a year unless they significantly increase their working hours.  Under government changes due to come into effect on 6 April 2012, couples with children will have to work a total of 24 hours a week to qualify for Working Tax Credit, rather than 16 hours as at present.

Official Treasury figures show that 305 households, including 670 children, in Wakefield could lose the £3,870-a-year credit as a result of the change.

Wakefield MP Mary Creagh is urging the Conservative-led government to reconsider the change to tax credit rules which will mean hundreds of families losing all of their working tax credits unless they can significantly increase their working hours.

The change means that couples with children earning less than around £17,700 will need to increase the number of hours they work from a minimum of 16 to 24 hours per week or they will lose all their working tax credit of £3,870 per year.

A recent survey by the Chartered Institute for Personnel and Development found that one in five organisations have cut back on the number of hours that people work as a result of the economic downturn, with just 6 per cent increasing them.

Wakefield MP Mary Creagh said “This is a deeply unfair change from a government that has already hit women and families in Wakefield hard.  People work part time because the full time work simply isn't there and the government’s economic policies mean companies and the public sector are laying people off.  Families with disabled children and full-time carers will not be excluded and parents could be pushed onto benefits and children into poverty by this move.  I am calling on Ministers to reverse this decision which penalises people in work."

Labour's Shadow Chief Secretary to the Treasury Rachel Reeves said "This is the wrong policy at the wrong time for thousands of families."

Read more here: http://www.bbc.co.uk/news/uk-politics-16992380