The Resolution Foundation has warned that April will see yet another deep cut to benefits happen, despite Theresa May’s claims at the Conservative Party Conference that “austerity is over” after eight excruciating years of cuts and tax increases.
In July of 2015 George Osborne promised that we would be faced with £12bn of welfare cuts, which saw benefits frozen against the rate of inflation in April 2016, 2017, 2018 and 2019, with the assumption being that inflation would remain below 2% every year. The actual figure, however, is over 6%.
This 6% cut has affected a number of benefits, including Child Benefit, Universal Credit, Tax Credits, Housing Benefit limits, JSA, and ESA. At the cost of the claimant, this means the Government has saved an astonishing £4.4bn – with £1.5bn of these cuts coming in April 2019. The freeze means that Child Benefits are now worth less than they were in April 1999, and JSA will be lower in April 2019 than it was in April 1991.
According to the Resolution Foundation’s estimates: “If we exclude pensioners and working-age non-parents, the impacts become even clearer. The average couple with kids in the bottom half of the income distribution will be £580 poorer in 2019-20 than if inflationary uprating had occurred since 2016-17, and the average poorer single parent will be £710 worse off. The April 2019 freeze alone will mean a £200 hit for an average poorer couple with kids and a £250 hit for poorer single parents.”
The report concluded: “The talk of the town may be of ‘the end of austerity’ and ‘Brexit dividends’, but for low to middle income working-age families – particularly parents – the outlook is quite different. On top of weak pay growth, their outlook includes a further benefits freeze, the transition to Universal Credit with its slashed work allowances, the phasing out of the valuable ‘family element’ and the phasing in of a two-child limit.
“Ending the freeze one year early, with benefits rising just after Brexit day, would help turn that outlook around.”Get your copy of UNITE Magazine