Government boosts child benefits

In his first budget, chancellor Alistair Darling announced a £765 million investment in the coming tax year with a further £950 million the following year to help lift 250,000 more children off the breadline.

The move was welcomed by action groups. Kate Green, chief executive of Child Poverty Action Group, said: "This is excellent news for Britain's poorest children. It keeps the 2010 target to halve child poverty in reach. It won't take us all the way there, but the intent is clear and a significant step forward has been taken.

"We must end the moral disgrace and social and economic costs of so many more British children living in poverty than in other wealthy countries. It is not acceptable, affordable or in Britain's interests to continue failing millions of children. It is right that children were the winners."

Child benefit payments for the first child are set to rise by £20 a week from April 2009, a year earlier than planned.

Child Tax Credit was also in the spotlight with the chancellor promising to increase the child element by £50 above inflation for families on low and middle income. This means a family with two children on £28,000 a year will find themselves £130 a year better off.

Plans are afoot to change the rules on housing and council tax benefit so that families living on benefits are better off in work by October 2009. So, a working family with one child on the lowest income will gain up to £17 a week.

All long-term recipients of incapacity benefit will have to attend work capacity programmes by 2010.

Elsewhere, the chancellor announced plans for increased co-operation with the energy companies to give the five million people currently on prepayment meters a fairer deal. At present, energy companies spend around £50 million a year on social tariffs but the government wants to see this rise to at least £150 million in the coming years.

That's not all! For the rest of our Budget 2008 coverage, click here

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