Millions of families and pensioners rely on Child Tax Credit, Housing Benefit, Income Support, Income-based Jobseeker’s Allowance, Income-related Employment and Support Allowance, Working Tax Credit and Pension Credit to top up their income.

These payments are made by the Department for Work and Pensions (DWP) and HM Revenue and Customs (HMRC) to help those on a low income make ends meet.

However, although state benefits are due to rise 3.1 percent in April, charities have warned that people will still be £700 a year worse off if inflation hits seven percent this year as some economists have predicted.

The Foundation, an organisation that promotes social change through research, policy and practice, said: “For families on low incomes, a reduction in the value of benefit levels that are already inadequate could not come at a worse time.”

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