Parent
Media playback is unsupported on your device
Video

Budget 2015: Working parents discuss tax credits

The government says it needs to find a further £12bn in savings from the annual welfare bill to meet its goal of balancing the books by 2017-18.

With Prime Minister David Cameron promising an end to what he called the "ridiculous merry-go-round" of taxing low earners then handing money back in benefits, many are expecting the axe to fall most heavily on tax credits.

The working tax credit entitles parents who work a certain number of hours per week (16 for single parents, 24 for a couple with kids, for example) to receive just over £2,000, and extra money towards childcare.

However, by working for more hours than the minimum, recipients begin to lose this credit once their wages hit a set ceiling, and this can also lead to reductions in other benefits, like the child tax credit, which is means-tested.

For a full discussion of how the tax credit system works you can read this article.

BBC News visited a drop-in children's scheme run by the charity Home-Start, on the outskirts of Cardiff, to find out what parents think the chancellor could do to help them.

For many, the issue of working tax credits was crucial.

Video journalist: Dougal Shaw

  • 06 Jul 2015
Go to next video: What to look out for in the Budget