Families and single parents will see a drop of up to £2,000 in income by 2016

WORKING FAMILIES AND SINGLE PARENTS  out of work are going to be the biggest losers financially by 2015.

According to the the Institute for Fiscal Studies (IFS) for the Family and Parenting Institute (FPI), the average income for families with two children is projected to drop by 4.2 per cent or £1,250 a year between 2010 and 2015.

Families with children under the age of five are also going to take a bigger financial hit of 4.9 per cent by 2016.

Changes to tax and benefits and the introduction of Univeral Credit will see lone parents who are not working lose more than 12 per cent of their income by 2015, or a staggering drop of £2,000.

Chief Executive of the Family and Parenting Institute, Dr Katherine Rake said that having children has always been expensive and now there are even more penalties.

She said: “It is particularly surprising to see that some of the most vulnerable groups – such as families with new babies and lone parents out of work– are bearing the brunt of the tax and benefit reforms. Many families will be left struggling to understand why they have been singled out in this way and how this sits alongside the Government’s ambition for the UK to become a family friendly nation.”