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Family wages will rise more slowly because of George Osborne’s austerity measures and the deteriorating economy, according to shock new figures.

Average household incomes will be £860 lower than originally forecast in last July’s Budget, according to latest predictions.

The Government’s independent economic forecaster has also warned that Real Household Disposable Income has been revised down.

A new breakdown from number crunchers at the House of Commons library said expectations for wage growth up to 2020 were watered down in last month’s Budget.

Read more:New stealth tax to hit workers

The Office for Budget Responsibility said estimated real average earnings in 2015 were £28,620 per year (or £549 per week) - and were tipped to rise by 8.5% over the next four years.

But eight months earlier, in the July 2015 emergency Budget, the OBR had tipped a surge of 11.6%.

(Image: PA)

If average earnings were to grow as forecast in July, they would be around £3,300 higher.

But based on last month’s lower forecast, average earnings will be around £2,440 per year higher in 2020 than in 2015.

That means £860 has vanished down a black hole in just eight months - £17 a week.

Shadow Work and Pensions Secretary Owen Smith, who commissioned the analysis, said: “The Tories keep telling working families there’s light at the end of the tunnel - that the crisis of low pay won’t last much longer.

“But the reality is they’ve been saying that for years and workers are still experiencing the lowest pay growth in nearly a century.

“If they were serious about supporting working families, they wouldn’t be cutting billions of pounds from Universal Credit.

“Those cuts will make the Tory crisis of low pay even more severe for the millions of workers set to lose £1,600 a year.

(Image: Getty)

“The Tories must look anew at the damage their policies are causing to working families and cancel cuts to in-work support.”

Meanwhile, families face a separate £180 bombshell because of the Chancellor’s failures.

Last November, the Government’s independent economic forecaster predicted Real Household Disposable Income of £18,880 in 2020.

But in last month’s shambolic Budget, that had been revised down to £18,700 - a £180 black hole per family.

Before last year’s general election, the Chancellor claimed RHDI signalled living standards were climbing and families were “better off”.

Shadow Chancellor John McDonnell said: “George Osborne should be ashamed that in his unfair, failed Budget - in which he gave a tax cut of £3,000 a year on average to 5,000 millionaires - his recovery built on sand will make the rest of us £180 a year poorer.”