Section: Welfare Benefits

Research suggests Universal Credit cut could lead to 840,000 more people in poverty

Posted 20.09.21
Legatum Institute: Further reading

In an attempt to mitigate some of the financial impacts of the Covid-19 crisis, the Government introduced a range of financial support for families and businesses.

These included a temporary increase of £20 a week to Universal Credit and Working Tax Credits and the suspension of the Minimum Income Floor (that applies to self-employed people claiming Universal Credit).

New research from the think-tank Legatum Institute estimates that these policies alone protected some 840,000 people from poverty in Quarter 2, 2021.

The findings provide an indication of the potential poverty impacts of the removal of the existing levels of support - as is proposed for October 2021.

The above link gives access to the full research findings.

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JRF report expresses serious concerns about proposed cut to Universal Credit

Posted 01.09.21
Joseph Rowntree Foundation (JRF): Further reading

A report from the JRF, released a few days ago, provides analysis that shows the impact by Parliamentary constituency of the planned cut to Universal Credit and Working Tax Credit in October.

Key findings are:

The analysis has shown that 6 million low-income families will lose £1,040 from their annual income as a result of the proposed cuts, creating serious financial hardship and leave 500,000 people to be swept into poverty - including 200,000 children.

Families with children will be disproportionately impacted and worryingly - 6 in 10 of all single-parent families in the UK will be impacted.

The report notes the Government's argument that it wants to support people back into work as we emerge from the pandemic - but points our that working families make up the majority of those who will be affected.

The report comments on the adequacy of social security, which it argues has reduced significantly in recent years and that the £20 increase was a vital strengthening of support.

It also highlights the views expressed by politicians of all parties, who have warned against this cut and called for the investment to be made permanent - including all six previous Secretaries of State for Work and Pensions since 2010.

It further notes the similar views from the Work and Pensions Committee, the Lords Economic Affairs Committee, the Conservative Northern Research Group and the Conservative One Nation Caucus.

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Quick Links

Updated 01.09.21

Welsh Government: A letter from the UK's three devolved Governments has been sent to the UK Government, expressing "grave concerns" regarding plans to withdraw the £20-per-week increase to Universal Credit.

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Media Watch

Updated 23.09.21

HuffPost UK: Boris Johnson Says Universal Credit Claimants Should Rely On Their Own 'Efforts' Not Welfare.

The Guardian:Ministers are examining a £1 billion-a-year increase in benefit payments to cushion the impact of the imminent £6 billion-a-year cut in universal credit.

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Reporting on September 2021

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