“Average working families” and the Budget

15 March 2017
What was claimed

The IFS found average working families will be £1,400 worse off because of the 2017 Budget.

Our verdict

That’s not correct. Figures on this scale don’t refer to the recent budget, they cover all changes to tax and benefits from 2015 to 2020. The average one-earner couple with children stands to lose £1,400 over this period and households with children overall are expected to be £1,300 worse off.

“According to IFS figures, average working families will be £1,400 worse off as a result of her Budget that’s been produced last week”.

Jeremy Corbyn, 15 March 2017

There was only one new change to personal taxes and benefits in last week’s Budget.

It was the change to National Insurance Contributions for self-employed people and it’s since been reversed.

So we’ve asked Labour what Mr Corbyn was referring to.

He may have been talking about Institute for Fiscal Studies analysis of the long-term impact of every single change to tax and benefits set to happen between 2015 and 2020.

The IFS suggests that working-age households with children will on average end up with around £1,300 less each year.

That’s not necessarily what most people would think of as “average working families”. It’s an average of all working-age households, from the poorest to the richest, ignoring whether anyone in the house is actually employed.

Similarly, the average one-earner couple with children stands to lose around £1,400. But again, it doesn’t matter how much they earn and we’re only talking about one kind  of “working family”.

Families where both parents work or lone parents, for example, will be affected very differently.

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