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Universal Credit cut ‘like destroying lifeboats’ says Christians Against Poverty

22 July 2021


THE social-security system is pushing domestic budgets into the red and causing levels of well-being to fall, a report from the debt-counselling charity Christians Against Poverty (CAP) says.

It warns that problems will get worse with the planned ending, in October, of the weekly £20 temporary uplift in Universal Credit during the pandemic (News, 5 February): the cut, it says, is like destroying the lifeboats on a sinking ship and leaving those on board to fight for survival.

The report, Shipshape or Sinking Ship?, published on Wednesday, is based on the findings of a survey of 897 CAP Debt Help clients which was conducted online and by post between last October and November. It used academic indicators to assess people’s financial and mental well-being.

“CAP clients with an income of less than £900 per month had an average financial well-being score of just 42 out of 100 and a mental well-being score of 19 out of 35; the UK average score being 26,” the CAP’s UK chief executive, Paula Stringer, said. “Removing another £87 a month from Universal Credit claimants’ incomes will push those affected into further debt and poverty, and have a significant impact on their financial and mental well-being.

“The end of Covid-19 restrictions doesn’t mean an end to the impact it’s having on people’s personal finances. With all the challenges millions of families have been facing, they will be carrying forward the financial impact for years to come in the form of household debt.

“High financial and mental well-being contributes to improving communities and helps boost the economy. Helping people improve their well-being results in them feeling in control, confident, and optimistic about the future, which leads to more jobseekers’ finding employment, more positive and active communities, and a stronger economy.”

Government statistics show that Universal Credit claimants nearly doubled to six million between the start of the pandemic in March 2020 and January this year.

The report calls for a halt in cuts to Universal Credit and tax credits, and an increase of £20 a week in other benefits; the trialling of initiatives to improve the well-being of insolvency clients; a cost-of-living review of social security; the annual measuring of Britain’s financial well-being by the Money and Pensions Service, using an agreed academic index; identifying problem debt as a public-health issue; and research to understand the link between well-being, support networks, and debt-advice outcomes, especially for single parents.

Ms Stringer said: “We’re asking the Government and MPs from all political parties to do the right thing: support our recommendations and start fixing the boat by not taking £20 a week off those who are already living with deficit budgets and struggling to survive.”

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