Government announces £7bn more savings on welfare budget

THE chancellor announced a fresh crackdown on benefit fraud yesterday as well as a further £7bn of cuts to the welfare budget on top of the £11bn savings announced in June.

George Osborne said the current “complex” system of means-tested working age benefits and tax credits will gradually be replaced by a universal credit that would “sharpen” work incentives and reduce fraud and error.

But low income families with children would be protected from the effects of the “essential savings” through an above inflation increase of £30 in 2011 and £50 in 2012 to child tax credit. The welfare reforms included freezing working tax credit for three years while the mobility component of the Disability Living Allowance would also be removed.