More than half of all households receive more in benefits than they pay in tax

MORE THAN half of households in the UK receive more from the state in welfare payments and pensions than they pay in tax, according to a new report.

The Houses of Parliament.

The 51.5 per cent of households taking in more than they contribute in 2013/14 is down from a peak of 53.5 per cent in 2010/11, but remains well above the 43.8 per cent recorded in 2000/01, said the report published by the Centre for Policy Studies think tank.

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Co-author Adam Memon said that the figures displayed levels of “welfare dependency” which were too high. He urged the Government - which is planning a further £12 billion in cuts to working-age benefits - to press ahead with deeper welfare reform.

But the TUC dismissed the analysis as “extremely misleading”, because it included retired households who receive pensions after a lifetime of paying taxes. TUC general secretary Frances O’Grady described the report it as “a blatant attempt to give the Government political cover to slash public services and in-work benefits”.

The CPS report found that the poorest fifth of households received an average £9,982 more from the state than they paid in taxes, while the middle fifth received £3,517 more than they contributed. The richest fifth paid £20,777 per household more than they received. Partly as a result of the redistributive effect of these payments, levels of inequality in the UK were lower in 2013/14 than in any year under the previous Labour government, said the report.