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JRF report criticises cuts in benefits

15 February 2019

PA

Amber Rudd, the Work and Pensions Secretary

Amber Rudd, the Work and Pensions Secretary

CUTS to benefits and tax credits, rising living costs, and the raising of the state pension age for women have excluded single-parent families, in-work families, and single female pensioners from benefiting from a “modest” rise in average earnings, a report by the Joseph Rowntree Foundation states. The findings were released last week.

On Monday, the Work and Pensions Secretary, Amber Rudd, said that “challenges” with the initial rollout of Universal Credit had driven claimants to foodbanks.

The Joseph Rowntree report found that children raised in single-parent households were twice as likely to be growing up in poverty as children raised by two parents. In 2016/17, almost three-quarters of children in lone-parent families (72 per cent) were living in households with an inadequate income: more than twice the figure for children in two-parent households (34 per cent).

The report noted that about 40 per cent of single parents working full-time had an income that fell below the Minimum Income Standard (MIS).

The MIS is a benchmark set by researchers at Loughborough University and members of the public to reflect the goods and services considered necessary for people in the UK to have the minimum “socially acceptable standard of living”.

Overall, almost half (42.5%) of children are living in households with inadequate income: a rise of 700,000 from 5.1 to 5.8 million since 2008/09.

The report also found a growing proportion of households on inadequate income are those where there is full employment. Of working-age households living below the MIS in 2016/17, in more than one in eight (about 470,000 households, or 11.6 per cent) all adults worked full-time: a rise from 9.7 per cent in 2008/09. Half of working-age-couple parents with a single breadwinner live below the MIS.

The authors of the report linked this rise in in-work poverty to cuts to benefits and tax credits, and “the costs of bringing up children — both the direct costs and the opportunity costs related to employment constraints”.

The report also found that single pensioners living below the MIS almost doubled, from 0.7 million to 1.3 million, between 2008/09 and 2016/17, which the foundation linked to the rising cost of food and fuel and “pensioners identifying additional needs (such as computers)”.

Female pensioners were more likely than male pensioners to live in households with incomes below the MIS. The report said that more than 25 per cent of women pensioners, and more than 20 per cent of male pensioners fell into this category.

The rise in the age at which women become eligible for the state pension, from 60 to 65, has been blamed for a sharp rise in poverty among women in their early sixties.

Since the change, phased in from 2010, the proportion of 60- to 64-year-old women living on less than the MIS has more than doubled, from 19.2 per cent to 38.9 per cent, the report found.

Overall, the number of people living without a basic income has risen from 16.5 million to nearly 19 million in the past decade; that number peaked in 2013/14, however, and is slowly declining.

The report concluded: “Living standards are not improving for some types of household, especially groups who already have the highest rates of low income. JRF recommends that the Government should lift the freeze on working-age tax credits and Universal Credit a year early; so that support keeps up with the rising cost of living.”

Waiting campaign. Last week, the Trussell Trust launched a campaign to end the five-week wait for the initial payment after people are switched to the Universal Credit system. The trust argues that people are being forced to use foodbanks because of the financial deficit they incur during the waiting time.

www.trusselltrust.org

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