I congratulate my hon. Friend Kirsten Oswald on securing such a vital debate. My constituency is perhaps not the first to come to mind when thinking of areas where poverty strikes, but our enduring challenge is the low-wage economy. Unemployment is low in comparison with many other areas, but low wages are the biggest threat to children growing up there. Indeed, low wages, coupled with the increased cost of living, have certainly played a part in 210,000 children in Scotland living in relative poverty, many of whom come from families in which at least one parent is working. That should quite simply be considered an outrage.
We often hear the UK Government talk of making work pay, yet policy decisions achieve quite the opposite. In my constituency, that means one in five children growing up in poverty, with the figure as high as one in three in some parts. Changes to the tax credit regime will, without question, further worsen the living conditions of over 7,000 children in Inverness, Nairn, Badenoch and Strathspey, as up to £1,000 a year is taken out of family budgets. The measures announced in the Budget are regressive, and it is children in families with the lowest incomes that continue to be hit hardest. It should be borne in mind that the proposals will affect life chances in areas of high deprivation, and families who are on the radar of financial distress. They will also be part of daily life for those who are afraid to admit to their situation, through fear of unwanted service disruption or sheer embarrassment at the stripping away of layers of personal pride that the removal of support leads to.
I want to share how, in the highlands, in-work families will lose out as a result of the tax credit regime changes. Limiting tax credits to two children results in the removal of £7.2 million from welfare payments in Highland—simply put, that is £7.2 million from low-wage, low-income families. Removing the family element of tax credits takes £4.02 million from welfare payments in Highland, which is £4.02 million from low-wage families. Increasing the tax credit taper from 41% to 48% means the removal of £7.77 million from welfare payments in Highland. The reduction in income thresholds in tax credits equates to a removal of £33.33 million from welfare payments in Highland, which is a further £33.33 million from low-wage families. I will stop with the numbers, but everyone in the Chamber knows that they go on and on.
I want to ask the Government this: in our low-wage but low-unemployment economy, how do such cuts ever help make work pay? They do not. Families are already struggling with housing costs, heating bills and food prices, and parents face a harrowing choice between heating their home or putting food on the table, with some even wondering if they will still qualify for the food banks because of the number of their visits. In a growing number of cases, due to the oppressive sanctioning regime faced by my constituents and many others, there is the phenomenon of no-income poverty.
Thank goodness the Scottish Government have, by paying, done what they can across the piece to mitigate the outrageous bedroom tax imposed on Scotland. In the highlands there are virtually no one or two-bedroom social housing units, which has been a real problem. Through no fault of their own, people have been scared and intimidated. Again, they have had to be compensated by the Scottish Government.
Poverty robs children of their childhood. Children and young people growing up in poverty face limited life chances. We surely should not accept any child growing up without a fair start in life. The charity Barnardo’s Scotland says that its caseworkers have recorded numerous cases of having visited homes where there was literally no food in the cupboards. The UK Government need to take action to reverse, not increase, child poverty. As others have said, these children are more likely to live in poor housing, to suffer chronic illness in childhood, and to die at birth or in infancy.