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Spending Review: 2.6 million families 'will be £1,600 a year worse off' after benefit changes

Up to 2.6 million working families could be an average of £1,600 worse off a year as a result of benefit changes announced in Chancellor George Osborne's Spending Review, according to independent economic experts.

Despite Mr Osborne's decision to scrap proposed cuts to tax credits due to come in next April, the Institute of Fiscal Studies says the introduction of the new Universal Credit, which consolidates a number of existing benefits, will result in the cut in cash for affected households.

The IFS also says Mr Osborne was "lucky" to receive a £27 billion windfall which allowed him to perform his U-turn on tax credits, adding the Chancellor will "need his luck to hold out" if he is to meet his target of a surplus by 2019/20 without raising taxes or imposing further spending reductions.

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Osborne: £12bn of welfare cuts to be 'delivered in full'

The £12 billion of welfare cuts promised by the Conservatives at the general election "will be delivered in full", Chancellor George Osborne has said.

He said the cuts would be "delivered in a way that helps families as we make the transition to our new National Living Wage."

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