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Since tax credits reduce entitlement to other benefits, 57% of tax credit savings will be offset by increased housing benefit and council tax support.
Finding ways of reducing spending on housing benefits is among the biggest headaches faced by the Government, which has attempted to reduce entitlement.
The Democrats voted it down because they knew it would reduce entitlement benefits.Michael Muse HoustonElder underlingsSIR – Schumpeter wrote about coping with an ageing workforce (February 6th).
The social security net is ignored, except in the intention to "take people out of tax"; increasing the threshold to £12,500 won't make a lot of practical difference, since it will simply reduce entitlement to in-work benefits.
Wasteful programmes are included to appease congressmen looking to boost employment in their districts.Yes, the government will have to reduce entitlement spending to achieve a fiscal balance, but cuts should be even-handed.
These include Sarah Wollaston, the chair of the Commons health committee and a former GP, who tweeted that the government would "never meet approval for change that would reduce entitlement to PIP at the same time as raising the higher rate tax threshold".
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"The only way to do that is to have broader tax increases or reduce entitlements.
Ranting about Obamacare, which one New Hampshire politician recently compared to the Fugitive Slave Act, is an excellent way to give the impression that you're fighting to reduce entitlements without having to do anything about the actual entitlements.
That difficulty has been well-illustrated recently in Greece and Portugal, with strikes and protests as citizens march in the streets to oppose tough austerity measures that directly reduce entitlements and state benefits.
One of the options that has been mooted is cutting child tax credit back to its 2003 level, which the Institute for Fiscal Studies has calculated would reduce entitlements for about 3.7 million low-income families with children by an average of £1,400 a year, and overall spending by about £5bn.
Reducing entitlement programmes will be tricky, to say the least.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com