Skip to main content
Poor ‘will suffer most’ in next recession

BRITAIN’S poorest families will suffer the most in the next recession because of cuts to welfare payments, the Institute for Fiscal Studies (IFS) warns today.

Tory changes to social security — such as universal credit, the freeze on working-age benefits and cuts to child tax credit — mean low-income households will have significantly less “insurance” if earnings fall.

The poorest households will lose an average of 53p after tax for every £1 fall in their pre-tax income when recession hits, up from 39p under the current arrangements.

The 95th Anniversary Appeal
Support the Morning Star
You have reached the free limit.
Subscribe to continue reading.
Similar stories
Chancellor of the Exchequer Rachel Reeves stands next to Prime Minister Sir Keir Starmer as he acknowledges guests during a visit to the Benn Partnership Centre, a community centre in Rugby, Warwickshire, November 27, 2025
Features / 28 November 2025
28 November 2025

The 2025 Budget shores up the PM’s political position with headline-grabbing welfare U-turns, but with no improvements on offer to declining public services or living standards, writes MICHAEL BURKE

Business Secretary Peter Kyle, Chancellor of the Exchequer Rachel Reeves and Prime Minister Sir Keir Starmer on stage ahead of Reeves's keynote speech during the Labour Party Conference at the Liverpool Arena, September 29, 2025
Labour Party Conference 2025 / 30 September 2025
30 September 2025

Labour will find increases in the state pension age are unacceptable, just as cuts to the Winter Fuel Allowance, personal independence payments and universal credit are — it needs to change direction immediately, writes PCS general secretary FRAN HEATHCOTE

WE MUST DO BETTER: Jon Trickett speaks in the House of Commons, September 10 2025
Labour Conference 2025 / 29 September 2025
29 September 2025

We cannot refuse to abolish the unjustifiable two-child benefit cap that pushes children into poverty while finding billions of pounds for defence spending — the membership and the public expect better from Labour, writes JON TRICKETT MP