Emergency Budget measures 'regressive'

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The coalition's emergency Budget has hit families with children the hardest, according to the Institute for Fiscal Studies.

In a report published today the respected financial think-tank appears to once again call into question George Osborne's claim that his was a "progressive Budget" that would impact on the rich more than the poor.

According to the research carried out for the End Child Poverty Campaign the tax and benefit changes announced in the emergency Budget are "clearly regressive as, on average, they hit the poorest households more than those in the upper-middle of the income distribution in cash, let alone percentage, terms".

The report adds: "Low-income households of working age lose the most as a proportion of income from the tax and benefit reforms announced in the emergency Budget.

"Those who lose the least are households of working age without children in the upper half of the income distribution."

Shadow work and pensions secretary Yvette Cooper seized on the report, damning the government for conducting "shocking and unfair attack on children and families".

“The chancellor claimed his Budget didn't increase child poverty – but only because he deliberately didn't count cuts in housing benefit, disability benefits and child tax credit that hit families hard," she said.

“The idea that the poorest families with children should end up being hit hardest is appalling and gives the lie to George Osborne’s claim it was a progressive budget.”

But the Treasury said it "does not accept" the IFS analysis, claiming the report was selective in what it analysed.

And Fiona Weir, a spokesperson for the End Child Poverty campaign, said that despite the coalition's commitment to ending child poverty by 2020, its cuts were "hitting the poorest families hardest".

"It’s not fair that children should have to pay for the cuts and shocking that the poorest families are bearing the brunt of them," he said.

"The coalition must re-consider its cuts, including changes to Housing Benefit and uprating benefits.

"The spending review will need to show clearly how the government will deliver on the commitment to ending child poverty, ensuring that cuts fall on those most able to pay."

The Institute for Fiscal Studies has previously questioned Osborne's claim that his Budget was progressive, noting that the main measures which will lead to losses amongst better-off households were announced by the previous government. While the reforms enacted by the coalition to be in place by 2014–15 are generally regressive.