January 13, 2011 12:45 PM

Commenting on the publication of a report by the Institute of Fiscal Studies into the Department of Work and Pensions' proposed 'Universal Credit' reforms, Jenny Willott MP, the Co-Chair of the Liberal Democrat Parliamentary Committee on Work and Pensions said:

"The IFS report acknowledges that the Universal Credit system will make the benefits system simpler and more effective. It will help reduces mistakes and fraud and ensure that work really does pay.

"Under the system built up by Labour too many people have found their way into work only to be told that for every pound they earn they will lose 90p or more of their benefits. This is demoralising and unfair."

On claims by the IFS that 1.4 million families will lose out under the system because of changes to tax credits Jenny said:

"The Universal Credit system is still being developed and so even the IFS accept that making exact judgements about winners and losers is a difficult task. However, their report shows that 2.5 million families will be better off because of the Universal Credit.

"The changes to the rates at which tax credits are taken away will mean that some people may be up to 3p in the pound worse off, , but the Government is already looking at transitional measures to ensure that those that might lose out, don't.

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