The Liberal Democrats have cited evidence provided today by Parliament’s watchdog to an influential parliamentary committee as further proof of the need for a fundamental review of the tax credit system.

Commenting on the Parliamentary and Health Ombudsman’s evidence to the Public Administration Committee, Liberal Democrat Shadow Work and Pensions Secretary, Danny Alexander MP said:

"The ombudsman’s withering assessment of how the tax credit system was set up should shame the Treasury into a fundamental review of the system.

"Gordon Brown needs to take personal responsibility for this failing system - its laudable policy objectives are thoroughly undermined by complex bureaucracy.

"It is clear from the ombudsman that even when it works as intended, the system is in many cases worsening child poverty and incentives to work.

"When the poorest families are forced into debt and choose not to take up their benefits rather than endure the failings of tax credits, only the worst dogmatist would insist the policy was sound. The Liberal Democrats want to see a return to fixed awards with a fairer appeals process."