The Child Poverty Action Group said tax credits are effective inreducing the number of children living in poverty but overpayments werehurting families and eroding public confidence.
Kate Green, the group's chief executive, said: "The uncertainty,underpayments and overpayment recoveries have left many familiesstruggling with a reduced income."
The data, published by HM Revenue & Customs, showed that 413,700families in work received the childcare element of the working taxcredit in 2006/07. This compares to 374,300 in 2005/06.
- www.hmrc.gov.uk.
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