Warning about the impact of cuts to Universal Credit.

 

The National Government of 1931 cut benefits of insured workers by ten per cent.

I mention this because it was something that people, including my Glaswegian father,  remembered for years afterwards, Glasgow was of course on the places heavily affected by mass unemployment during the depression.

The Covid pandemic has had enormous economic effects as experts in the bleeding obvious say.

Specifically,

The number of people being made redundant in the UK is rising at the fastest pace on record as the second wave of Covid-19 and tougher lockdown measures put increasing pressure on businesses and workers.

Unemployment has hit the highest level for four years, while millions more workers have been placed on furlough. Although the jobs crisis has not been as bad as feared earlier in the pandemic, the government’s independent economics forecaster – the Office for Budget Responsibility – expects the jobless rate to more than double from pre-pandemic levels to 7.5% this summer after furlough ends, representing more than 2.6 million people out of work.

The UK’s Covid-19 unemployment crisis in six charts

This is from the East Anglian Daily Times, yesterday.

120% increase in Universal Credit claimants

The number of claimants for Universal Credit in Babergh and Mid Suffolk has increased by 120% amid the fallout from coronavirus – with a tsunami of extra demand expected.

Citizens Advice figures presented to Babergh and Mid Suffolk district councils’ joint scrutiny committee on Monday revealed that Universal Credit claimants had gone up by 119% in Babergh and 122% in Mid Suffolk compared to December 2019.

Today the story about the looming cut to Universal Credit continues,

NEW: 720,000 people or 95% of those who will be pushed into poverty by the planned Universal Credit cut are in working or disabled households, new research finds: https://t.co/lPVQbrVJcn

— LabourList (@LabourList) February 17, 2021

 

New Fabian Society research finds that over 700,000 people in working or disabled households are to be pulled into poverty by universal credit cuts. 

The report shows how the cut to universal credit will reduce the living standards of households in many different circumstances:

• Households with a disabled adult will be hit by 57 per cent of the cuts (£3.7bn per year)
• Families with children will be hit by half the cuts (£3.2bn per year)
• Households where someone is a carer will be hit by 12 per cent (£700m per year).

Only 13% of the savings will come from non-working, non-disabled households.

 

95% of those hit by UC cut in working or disabled households, report finds

Elliot Chappell. Labour List.

New research has found that 95% of those who will be pushed into poverty by the cut to Universal Credit and Working Tax Credit planned by Rishi Sunak this year are in working or disabled households.

Following the publication of the Fabian Society report Who Loses? today, supported by the Standard Life Foundation, the Labour affiliate has said the £20-per-week reduction to the benefit “raises fundamental questions of justice”.

Analysis found that 87% of the cut, £5.5bn, will fall on working and disabled households, while half, £3.2bn, will hit homes where someone is in work. Households with someone in employment will make up 65% of all those pulled into poverty.

Commenting on the findings of the report, Andrew Harrop warned that scrapping the £20-per-week uplift, introduced to help people cope with the pandemic last year, will “overwhelmingly punish working families and disabled people”.

The Fabian Society general secretary added: “The Chancellor’s planned cut will strip £1,000 per year from six million families and plunge three quarters of a million people into poverty.

“Some politicians like to pretend that social security is just for the work-shy. But the reality is that millions of working households need benefits and tax credits to make ends meet, as do disabled people who are out of work through no fault of their own.

“If ministers are considering a few months’ temporary extension to the Universal Credit uplift, that just isn’t good enough. The 2020 benefit increase must be placed on a permanent footing.”

The Chancellor introduced the increase last March. It is not available to those on legacy benefits: child tax credit; housing benefit; income-related employment and support allowance; income-based jobseeker’s allowance; income support.

It took the standard rate for a single claimant on Universal Credit for those over 25 from £317.82 to £409.89 a month. The extra support, worth over £1,000 annually to each household, is currently set to be withdrawn in April.

The paper published today shows that people who are not expected to be job hunting – those already in work or disabled – will be the main long-term victims of Sunak’s insistence on scrapping the uplift.