Tax credit cut to hit early years workers hard

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Research conducted by The Children’s Society and Child Poverty Action Group has discovered that nursery nurses are possibly going to lose up to £1,788 a year under current proposals. Teaching assistants and care workers would also be affected by these proposals.

Last week, after two motions were passed, Chancellor George Osbourne stated that he intends to go ahead with changes to tax credits, however, he is now committed to lessen the impact on families.

Meanwhile, during Prime Minister’s Questions, David Cameron refused to answer Jeremy Corbyn’s question six times about whether families would be worse off under the new plans.

Based on gross earnings data from the National Statistics and House of Commons Library, CPAG’s calculations are for sole earners that are working full time either as a single parent or the sole earner in a couple family.

A spokesperson for the CPAG has said: ‘We hope ministers take a deep breath and admit that these cuts will pull the rug from under the feet of working families. Ministers should now bring forward new measures to help working families – investing in tax credits, not cutting them.

‘Nobody who supports hard-working families can think it’s right to suck £1,788 from the tax credits of a nursery nurse’s annual income. These are grafting parents, often working long hours and trying to provide for their children. And if they are struggling now to pay for food, utilities, fares and children’s clothing, these kind of losses will make them fear for the future.’

The Children’s Society also agreed with CPAG’S call to make sure the Government helps working families.

Sam Royston, Director of Policy and Research, said:  ‘We urge the Government to rethink its damaging approach to tax credit changes before children are made to pay a heavy price.

‘It is now clear that children would be the biggest losers as a result of these changes, with about 4.5 million affected.

‘If the Government is serious about being the champion of hard-working families, as it claims to be, it must make sure that work always pays – and not push children in working families into poverty.’

Children’s charities and early years organisations have welcomed the decision from the Lords to delay the changes which would see the income threshold from those who are claiming Child Tax Credit cut from £16,105 to £12,125 and the threshold of those with Working Tax Credit from £6,420 to £3,850 from April 2016.

Tricia Pritchard, a senior professional officer from Voice said: ‘Nursery staff are already among the lowest paid workers and therefore any worsening of their pay and conditions would inevitably impact negatively on provision as a whole.

“Our fear is that if the proposed changes to tax credits were to result in loss to income in the region of £1,788 a year, many practitioners would be forced to leave the profession, hastening the decline in recruitment and retention. We could actually lose nursery places or, even worse, see nurseries close.

‘Our members work long hours and are already struggling to make ends meet. Family life for low-income families is already tough. These proposals add to their challenges by potentially placing their jobs in jeopardy and reducing provision for those who need it most.’

Chief executive of the Pre-School Learning Alliance, Neil Leitch, said: ‘For many years now, the sector has survived on the hard work and commitment of dedicated, passionate practitioners, most of whom work long hours for little pay simply because they love what they do. For these same professionals to suffer even further financially as a result of this policy is unacceptable. As such, we welcome recent pressure on the Government to rethink these plans, and hope that it will do so at the earliest opportunity.’

Peers voted 307 to 277 in favour of the motion put forward by Baroness Meacher to hold off plans to cut tax credits next year, as the Government has not responded to an analysis by the Institute of Fiscal Studies that showed up to three million families would lose £1,000 a year.

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