Chancellor Philip Hammond could lift 200,000 people out of poverty next week by ending the freeze on benefits and tax credits, a charity has said.
Hammond, who will announce new financial measures in the Spring Statement on March 13, could tackle rising inequality by ditching the cap on increases to welfare payments, the Joseph Rowntree Foundation suggested.
Families are already on average £340 a year worse off because of the policy, the charity said, and if it continued as planned until 2020 they could lose out by £560 a year.
One claimant told the charity that, since the benefit freeze was introduced in 2015, they had “been choosing between eating, heating, paying bills or dealing with another essential need or emergency”.
There have been cross-party calls for the government to end the freeze, which stops benefits and tax credits from rising in line with inflation.
Joseph Rowntree’s chief executive Campbell Robb said: “The chancellor must seize this opportunity to right the wrong of more and more families being swept into poverty.”
TUC general secretary Frances O’Grady said the freeze was holding back working parents from giving their children a decent life.
“It’s time to stop turning the screw. The government must scrap the benefits freeze and create a social security system that works for everyone when they need it,” she said.
A government spokesperson said: “Our priority is to support people to improve their lives. Since 2010 we’ve introduced the national living wage, doubled free childcare for 3 and 4 year olds, and cut taxes for 32 million people to help families meet the everyday cost of living and keep more of what they earn.
“But we know that some people need more support. That’s why we’re spending £90 billion to support families who need it, and by 2022 we will be spending £28 billion more on welfare than we do now.”