GEORGE Osborne has performed a U-turn on plans to cut tax credits following widespread condemnation of his original proposal.

The Chancellor made the announcement the centrepiece of his Autumn Statement to claim the Tories were the “mainstream representatives of the working people of Britain”.

However, he said he was still pressing ahead with his plans for £12bn in welfare cuts, which he declared would be “delivered in full”.

While he said the £4.4bn of tax credits cuts would be “avoided” campaigners warn that cuts to the family element of tax credits and the two child limit will still be enforced.

Mr Osborne said he was able to avoid the cuts because public finances had improved. He faced opposition form Labour, SNP, LibDems and the House of Lords over the plan announced in his July budget.

He said: "I've had representations that these changes to tax credits should be phased in.

"I've listened to the concerns. I hear and understand them.

"And because I've been able to announce today an improvement in the public finances, the simplest thing to do is not to phase these changes in, but to avoid them altogether."

Mr Osborne also said the UK NHS budget would increase by £20bn over the next five years and the police budget would not be cut.

The main opposition parties all claimed victory over tax credits but warned the details of the statement need scrutiny.

Ian Murray, Labour Shadow Scottish Secretary, said: “We need to look carefully at the detail, in particular the impact on Universal Credit, but with this announcement working families can sleep easier tonight.”

The SNP said the Chancellor was humiliated into the change.

Stewart Hosie, Deputy Leader said: "George Osborne's ideology has not changed he still plans to cut billions more than necessary to run a balanced budget, and will leave the people of Scotland facing the horror of a decade of austerity that we never voted for.

"His complete and humiliating U-turn on tax credit cuts shows that we were right to keep the pressure up to the last minute highlighting the damage that would be inflicted by changing the tax credit system and calling on George Osborne to reverse his proposal.”

The Greens went further and said the U-turn was “pretence”.

Patrick Harvie, Scottish Green MSP for Glasgow, said: "The Chancellor's apparent U-turn on tax credit cuts is a mere pretence, and vast numbers of people will still lose out, either now or under Universal Credit instead. The cumulative effect of cuts upon cuts will do untold harm to the least well off in our society.

The move was welcomed by poverty campaigners but with a warning that poorer people would still suffer.

Peter Kelly, Poverty Alliance, Director said: “The announcement on tax credits is welcome, but families still remain under financial pressure.

“We are now at the stage where there is nothing to cut. We are hurting the most vulnerable in our society.”

Mr Osborne also said Scotland would get an extra £1,9bn in capital spending and challenged the Scottish Government to accept the Fiscal Framework of the Scotland Bill.

He said Scotland was protected under the United Kingdom

He said if Scotland had voted for independence it would have meant a “catastrophic cut in Scottish public services.”