Millions Face Income Cut with Welfare Reform.

Tories Welfare ‘Reform’. 

I thought a lot about this yesterday.

First of all, let’s not forget that the Benefits Freeze means we are no longer able to keep up with every rising prices in the shops, utility charges and higher Community Charge.

Next, the report highlights the fact that many people on Local Housing Benefit,  are no longer getting their rents fully paid.

FInally you can guess the DWP’s response without even reading the article.

The Department for Work and Pensions said: “This report assumes that people won’t make any attempt to change and to improve their lives. But our welfare reforms incentivise work and, for the first time, universal credit helps working people progress and earn more, so they can eventually stop claiming benefits altogether.

“Under universal credit people are finding a job faster and staying in it longer than under the old system, and since the benefit cap was introduced, 34,000 households have moved off the cap and into work.”

In other words, ‘improve your lives” by getting out of the claws of the DWP and its so-called Universal Credit.

As Gauke would say, “I have made myself perfectly clear.”

Two million UK families face £50-a-week cut in income

Guardian.

Households with children make up more than 80% of those set to lose out as pressure grows for end to austerity

In a bleak assessment of the plight of the poorest families in Britain, the study commissioned by the Local Government Association found that more than 84% of those set to lose £50 a week or more are households with children, either lone parents or couples. Almost two-thirds of them are working households, despite claims from ministers that they wish to create a welfare system that encourages work.

The analysis, by the Policy in Practice consultancy, also undermines claims from ministers that moves to cut taxes and increase the wages of the poorest are compensating them for years of austerity and the rising cost of living.

While some of the seven million low-income households in Britain will be better off by 2020, the group as a whole faces an average loss of £40.62 a week by 2020 compared with the end of last year, once benefit and tax changes, wages, housing costs and inflation are all taken into account.

….

The study finds that the introduction of the government’s flagship policy of universal credit, which combines a series of benefits into a single payment, will lead to an average income loss of £11.18 per week. It coincides with new warnings from Citizens Advice that the rollout of the system should be halted, amid claims that some of those already receiving it have found themselves in serious debt.

With charities and councils warning of rising homelessness, increasing housing costs are identified as a main cause of falling income. More than 2 million low-paid private renters face an average real-terms loss of £38.49 a week by 2020.

For low-income private renters with three or more children, the average income loss that they face by 2020 in real terms is £67.21 a week. This compares with £30.67 for private renters without children.

The authors also say rents are rising faster in some areas than others, with housing benefit not rising to match it. The study found rents are set to rise by 20.7% in the south-west by 2020, but by just 3.5% in the north-east. The report warns that there is now a looming “affordability crisis” because cuts to housing benefit, known as local housing allowance (LHA) for private renters, mean it is no longer linked to real rents, pushing people into poverty or even homelessness.

This is the Report:

The Cumulative Impact of Welfare Reform: A National Picture

Extracts,

The combined effects of the major reforms implemented before 2017, namely the underoccupation charge (NOTE by Ipswich Unemployment Action, the Bedroom Tax) , the localisation of CTRS, the LHA shortfall and both benefit caps, result in an average nominal income loss of just over £23 per week for each working-age household.

The transition to Universal Credit will lead to a further average income loss of £11.18 per week.

This is largely due to cuts in work allowances which will hit households, often with children and previously in receipt of tax credits, particularly hard. The introduction of the National Living Wage and increases to the personal tax allowance will generate almost £3.2 billion for working, low-income households, reducing the average nominal income loss by 2020 to £7.62 per week.

However, these mitigating measures will only benefit 2.5 million of the 7.1 million affected working-age households, half of whom are not affected by welfare reform to begin with. Critically, the continued impact of reforms implemented before 2017 will increase the cumulative loss from welfare reform to an average of £40.62 per week by 2020. This is a consequence of expected inflation and private rent growth, combined with the freezing of benefits rates for working-age people through to 2020 and means that many households see
falls in real income. Private renters will be particularly hit because the link between the Local Housing Allowance rate and market prices has been broken.

The growing disconnect between rents and LHA rates means that the gap between housing support and housing costs will increase disproportionately for private sector renters. Nominally, private renters will be £2.75 per week better off by 2020, as they are more likely to be in work and so benefit from the increase in the National Living Wage and Personal Tax Allowance. However, once expected inflation and private rent growth is factored in, private renters will face average real terms losses of £38.49 per week, with higher losses for larger families.

Squeeze on living standards is down to welfare cuts, not the fall in the pound

Matthew Whittaker

Guardian

..for millions of low- and middle-income Britons, living standards looked under threat even when Brexit was nothing more than a twinkle in Boris Johnson’s eye. The key moment came when, fresh from the Conservatives’ 2015 general election victory, the chancellor George Osborne delivered a budget that promised to “reward work and back aspiration”.

True to his word, he presented some very good news by introducing the national living wage – a sizeable and welcome supplement to the minimum wage for employees aged 25 and over. But the good news was eclipsed by the bad. The estimated £4bn boost from the national living wage was dwarfed by savings of £14bn from cuts to working-age welfare. What’s more, the welfare cuts are concentrated among poorer households. In the coming years, Britain faces the prospect of the first significant rise in inequality in three decades.

There is plenty to add: as people have already noted they’ve found the cash for the Police and the Prison Officers.

End the Benefit Freeze!