UK households with children will have £142 wiped from bank account – and it could rise to £500

Jeremy Hunt has been warned he could face a red wall revolt if he delivers “a budget for the rich” at the Autumn Statement. The Chancellor and Prime Minister Rishi Sunak are this weekend finalising an Autumn Statement in the Commons on Wednesday, November 22.

The Chancellor is already in hot water amid reports he could cut working-age benefits, while cutting inheritance tax. The Chancellor is understood to be mulling over raising benefits at a lower inflation figure, rather than the 4.6 per cent recorded in October, which is the biggest fall in 30 years.

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The average annual income loss for families affected by this benefit cut would be £142. And even more worryingly, a typical working family with two children and rental costs would lose about £380 next year, while a working family with three children could lose about £500.

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Mr Hunt’s recalculation of how the welfare bill is calculated could save the Treasury about £1.3bn but move would hit the incomes of 9 million families. Some would lose as much as £500 a year, according to new analysis by the Resolution Foundation thinktank. John Stevenson, chair of the Northern Research Group of Tory MPs, representing 30 to 40 members in red wall seats, said: “I am all for reforming tax and inheritance tax needs reforming.

“However at this time any tax cuts should be aimed at helping businesses or the lower paid.” Jonathan Gullis, a former minister and the MP for Stoke-on-Trent North, said: “While long term this [inheritance tax] should be eventually abolished, now is not the right time for this tax cut.

“Instead, we should be looking at cutting the basic rate of income tax [and] increasing the 40p tax threshold to help families really feeling the pinch.” He added that the Chancellor should “go for growth” by increasing tax breaks for small businesses and the self-employed.

“We believe that the social security system should provide the vital safety net it was set up for in the postwar settlement,” senior Labour figures have written. “Some may argue that inflation will decrease over the next few months, but this ignores the real term cuts in working age social security support since 2011.”