Universal credit cuts 'recipe for disaster for struggling families' charity warns
Neil Puffett
Monday, September 6, 2021
Plans to cut a temporary increase to universal credit to help families deal with the impact of the Covid-19 pandemic must be rethought because of the damage it will have on millions of working families, Action for Children has said.
A temporary £20 increase to Universal Credit payments was introduced by the government last year in response to the pandemic, but the scheme is due to officially end on 6 October. Around 5.5million households across the UK claim universal credit and will face an income loss equivalent to £1,040 a year.
Research commissioned by Action for Children, conducted by the Child Poverty Action Group, found that the cut is set to compound other benefit cuts over the past decade, with people in certain jobs particularly affected.
Analysing a typical sole-earner family with two children in a selection of common low- to middle-income jobs, the research found that hairdressers will be worst off, losing an average of £1,982 a year after the cut, followed by pharmacy assistants (£1,946 average annual loss) and shelf stackers (£1,843).
Imran Hussain, director of policy and campaigns at Action for Children, said that while the charity welcomes the government’s levelling-up agenda "you can’t level up the country by pushing down the living standards of some of the hardest working families".
“Too many childhoods are overshadowed by poverty and hardship, and the pandemic is making things worse," he said.
"Our analysis shows the huge squeeze on incomes millions of working families will face at the end of this month.
"We’re talking about hairdressers, shop-workers and carers - not big earners, but people who are proud to work and do everything they can to provide for their children."
Hussain said the government needs to rethink its plan to cut universal credit.
"It’s a recipe for disaster for struggling families and clashes with the end of the furlough scheme when more parents will be at risk of losing their jobs, the extra costs of the school term and a rise in energy bills as we head into the colder months,” he added.
Last month, research by youth homelessness charity Centrepoint found that young people will be "hardest hit" when the £20 increase ends, with claimants under the age of 25 facing a weekly cut of 25 per cent to their standard universal credit allowance, compared with a weekly cut of 17 per cent for claimants over the age of 25.
Both Action for Children and Centrepoint are among more than 100 signatories to a letter published last week calling on Prime Minister Boris Johnson to reverse the decision.
