Prime Minister David Cameron’s tax and benefit changes will make U.K. households almost 1,000 pounds ($1,650) worse off a year by 2015, the opposition Labour Party said.
Families will have 974 pounds less to spend due to measures introduced since the Conservative-led coalition took office in 2010, Labour said in an e-mailed statement, citing an Institute for Fiscal Studies analysis commissioned by the party. A family with children where both parents are working will be on average 2,073 pounds a year worse off, and households with only one working parent will be 3,720 pounds a year poorer.
With 13 months to go before the general election and polls showing its lead over the Tories dwindling, Labour is seeking to counter Tory claims that incomes are rising again as the recovery takes hold. The party says there is a “cost of living” crisis for most people and government policies had favored only the rich.
“Cameron is trying to tell working people they are better off, but he’s not fooling anybody,” said Ed Balls, Labour’s Treasury spokesman. “The Tories are giving with one hand but taking away much more with the other.”
A Treasury report published last month showed that taking tax policy into account, including increases in the amount people can earn before paying income tax, take-home pay increased faster than inflation in 2012-2013, except for the top 10 percent of earners.
Measures pledged by Labour should it win the next election include freezing energy bills until 2017 and returning the top rate of income tax to 50 percent.