The Institute for Fiscal Studies (IFS) has forecast a 7.4 per cent fall in real median net household income in the wake of Chancellor George Osborne’s autumn statement this week.
The forecast fall nearly matches the one experienced in 1974-77 of 7.5 per cent, the largest three-year fall since records began in 1961.
The IFS has also predicted a decision not to raise child tax credit above the rate of inflation will do nothing to improve the outlook for child poverty.
"We estimate little overall change in outlook for the path of child poverty in coming years," the IFS said.
"[It] remains inconceivable that government will get close to its 2020 child poverty targets under current policies."
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