100 organisations across the housing and charity sectors have joined efforts in urging the Prime Minister to not go ahead with the planned £20-a-week cut to Universal Credit and Working Tax Credit in October. The Joseph Rowntree Federation has co-ordinated the Open Letter to Boris Johnson. Their research has found the following:
- 140 constituencies would see more than one in four of all families (with or without children) affected, including 36 Conservative seats;
- On average 21 per cent of all working-age families (with or without children) in Great Britain will experience a £1,040-a-year cut to their incomes on 6 October; and
- Over 400 constituencies are set to see over one in three working-age families with children hit by the cut.
The Government raised Universal Credit and Working Tax Credit by £20 a week back in March 2020, but ministers at the Department of Work & Pensions have always claimed this was a temporary uplift. This was recently confirmed by Therese Coffey, the DWP Secretary of State.
If it proceeds the cut will particularly impact on low income tenants and could undermine the cashflows of both social and private landlords, driving thousands of tenants further into rent arrears and at risk of eviction.
JRF say if the planned reduction takes place from 6 October, this will impose the biggest overnight cut to the basic rate of social security since the foundation of the modern welfare state.
“Our analysis has shown that 6 million low-income families will lose £1,040 from their annual income, 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.”
Politicians of all parties have warned against this cut and called for the investment to be made permanent, including Labour and SNP leadership, all six previous Secretaries of State for Work and Pensions since 2010, the Work and Pensions Committee, the Lords Economic Affairs Committee, the Conservative Northern Research Group and the Conservative One Nation Caucus.
As well as familiar names such as Oxfam, Save the Children, and the Trussell Trust, the signatories include the National Housing Federation, PlaceShapers, the Northern Housing Consortium, Shelter, Crisis, Business in the Community – a charity founded by the Prince of Wales – the Royal College of Paediatricians and Child Health, and the Tory thinktank Bright Blue.
The letter comes as separate academic research revealed 63 per cent of people supported the £20 increase during the pandemic, and 50 per cent supported making it permanent, suggesting public support for retention remains strong.
Ben Baumberg Geiger, the joint leader of the project and a social policy lecturer at the University of Kent, said: “It would be easy to conclude that despite Covid-19, the public has little appetite for a more generous welfare system – but this would be wrong.
“Before the pandemic, attitudes had become more pro-welfare than the UK has seen in 20-30 years, and support for more generous benefits is even higher if this is linked to Covid-19. Public attitudes depend on how politicians talk about welfare, which means that the impact of Covid-19 on welfare attitudes and policies is all to play for.”
Open letter to the Prime Minister The Rt Hon Boris Johnson MP, Prime Minister, 10 Downing Street, London, SW1A 2AA
“Dear Prime Minister, We are writing to collectively urge you not to go ahead with the planned £20-a-week cut to Universal Credit and Working Tax Credit at the beginning of October.
Many of us provide frontline support in communities up and down our country and see first-hand the importance of our social security system. Life is full of crises that we cannot plan for, such as job loss or illness, and periods of lower earnings or caring responsibilities. We all need the security and stability of a strong lifeline, not just during a national crisis, but every day.
Imposing what is effectively the biggest overnight cut to the basic rate of social security since World War II will pile unnecessary financial pressure on around 5.5 million families, both in and out of work.
At the start of the pandemic, the Chancellor rightly said that he was introducing the £20 increase to “strengthen the safety net” – a tacit admission that a decade of cuts and freezes had left it unfit to provide the support families need. We all strongly supported this crucial improvement in support.
We are at risk of repeating the same mistakes that were made after the last economic crisis, where our country’s recovery was too often not felt by people on the lowest incomes. The erosion of social security support was one of the main drivers of the rise in in-work and child poverty, and contributed to a soaring need for food banks, rising debt and worsening health inequalities.
We deeply regret that the Department for Work & Pensions has not published its assessment on the impact of cutting Universal Credit and Working Tax Credit. However, the latest independent analysis from the Joseph Rowntree Foundation (JRF) shows it risks plunging 500,000 people into poverty, including 200,000 children. It will take the main rate of out of work support down to its lowest levels in real terms since around 1990.
This is not a question of having to choose between a recovery based on getting people into jobs or investing in social security, in fact most families impacted by this cut to Universal Credit and Working Tax Credit are already in work. The reality of the UK labour market means that to improve living standards, we need to both improve job quality and strengthen the social security system. We also must never lose sight of the need to provide adequate support to families who are not able to work so they can meet their needs with dignity.
Six former Conservative Work & Pensions Secretaries believe previous cuts to social security spending went too far and oppose this cut, and your own Conservative MPs are warning that it will have deep and far-reaching effects in their constituencies.
Recent analysis from JRF shows that 413 parliamentary constituencies across Great Britain will see over a third of working-age families with children hit by the planned cut to Universal Credit and Working Tax Credit on 6 October 2021. Of these 413 constituencies, 191 are Conservative – 53 of which were newly won at the last general election or in a subsequent by-election.
This looming cut would fundamentally undermine the Government’s mission to level up. Citizens Advice has identified that people are one and a half times more likely to claim Universal Credit in places the Government has prioritised for levelling up investment. They also found for every £1 that could be invested from the Levelling Up Fund in England, £1.80 would be taken from these local economies if the Government presses ahead.
Furthermore, it is unacceptable that legacy benefits, such as Employment and Support Allowance, Jobseeker’s Allowance and Income Support, continue to be excluded from this crucial improvement in support, mostly impacting people who are sick, disabled or carers.
We are rapidly approaching a national crossroads which will reveal the true depth of the Government’s commitment to improving the lives of families on the lowest incomes.
We all want a social security system that supports families to escape poverty rather than pulling them deeper into it. However, this cut risks causing immense, immediate, and avoidable hardship. A strong social security system is a crucial first step to building back better. We strongly urge you to make the right decision.”
By Patrick Mooney, Editor