Lyn Brown has hailed a “major victory” after George Osborne dropped plans to cut tax credits in his Spending Review, but warned Newham schools could lose money.

The chancellor was expected to ease the impact of cuts to tax credits but instead scrapped them altogether.

He also surprised Parliament by pledging a real terms increase to police funding despite speculation that cuts were imminent.

The MP for West Ham, Lyn Brown, said she was happy to see tax credit cuts cancelled but did not fully endorse the chancellor’s changes.

“The Autumn Statement delivered a major victory for all of us who have campaigned against tax credit cuts,” she said. “But it is not a complete victory as tax credits will be cut for families with more than two children, something the chancellor appears to have forgotten to mention.”

Mr Osborne also pledged 30 free hours of childcare from 2017 to parents who work more than 16 hours a week but earn less than £100,000 a year.

Ms Brown, however, said the government will “deny 30 hours of free childcare for anyone working less than 16 hours a week.”

A new school funding formula is set to be introduced from 2017, the chancellor said, which prompted concern from Ms Brown.

“As always with this government, the devil will be in the detail,” she said.

“I will be looking hard at the new formula for schools funding as I fear it will mean money going from Newham to wealthier local authority areas and local government is being slashed by £9 billion a year.

“If the government is true to form they will announce what this means for Newham on Christmas Eve.”