George Osborne is facing the first Conservative revolt over the budget from MPs worried about plans to remove up to £1,000 a year in tax credits from families.

The chancellor will face “real anger and frustration” over the changes, which hit “the very people we ought to be supporting” according to Tory MPs.

They also worry that the changes will be a disincentive to work after years of promises to make work pay. Mainstream Conservative MPs are sounding the alarm for the first time today over the scale and suddenness of the cuts.

The Institute for Fiscal Studies has said that 13 million families will lose an average of £240 a year, and three million families will lose £1,000 a year.

Mr Osborne’s changes dwarf