Child Tax Credit to rise by £75

Mum and child

The child element of Child Tax Credit will increase by £75 above indexation from April next year after the government decided to bring forward the proposed increase for 2010.

Originally, the Child Tax Credit was to be increased by £50 above indexation next April, with a further increase in that credit of £25 above indexation in 2010.

In order to help cash-strapped families, the chancellor said: "I now intend to pay both these increases together in April, making it worth in total £2,235 for modest income families."

Earlier announced increases in child benefits from £18.80 to £20 a week for the first child, and from £12.55 to £13.20 a week for subsequent children will now come into effect already in January next year - three months earlier than initially planned.

To further tackle child poverty, the chancellor announced that the government is to introduce a child poverty bill next year which will aim to eradicate child poverty by 2020.