Child poverty campaigners blast VAT increase

The Robin Hood Tax campaign group, which includes Barnardo's, Oxfam and Save the Children, has said the 2.5 per cent rise in VAT to 20 per cent will increase families' average VAT spending to £31 a week.

This will disproportionately affect the poorest families and plunge many more into poverty, the group argued.

In a statement the campaign group said: "The poorest families in the UK, who already struggle to afford basic household items, could be pushed over the breadline with an annual VAT bill of at least £1,600."

The group is calling for the government to instead raise more taxes from the financial sector.

Robin Hood Tax spokesman Max Lawson said: "It is deeply unfair that those living in poverty may have to choose between paying their heating bill or giving their child a hot meal, while the bankers celebrate the new year with yet another round of multi-million-pound bonuses."

Support from the voluntary sector for disadvantaged families will also suffer through the VAT rise, according to the charity Family Action. It has said that an extra £12,000 a year is needed to provide the same level of grants it provided in 2008/9. It handed out £540,000 in grants of between £100 to £300 to 3,000 disadvantaged families during that year.

Rhian Beynon, head of policy and campaigns at Family Action, said: "These welfare grants are an absolute lifeline to vulnerable families and this increase will reduce our ability to support people. The grants are vital to people forced to flee domestic abuse or families facing crisis when a cooker breaks and they have no savings to get a replacement.

"With the hit our investments have taken due to low interest rates and the increased applications we’re seeing as more families face hardship we’ll have no option but to look for more corporate or individual support or risk families losing out."