The UK’s leading poverty charities have called for a change in law to fix the UK’s ‘failed’ welfare system after research revealed that the basic benefits given to low-income families are at least £ 140 per month below the actual cost of food, energy and everyday basics.
The Joseph Rowntree Foundation (JRF) and the Trussell Trust food bank network said inadequate benefits were the main factor in the explosion of poverty and the use of food banks in recent months, and urged the government to formally align universal credit with minimum life. costs.
JRF chief executive Paul Kissack said the “so-called” social safety net floated completely free of the economic realities of people’s lives. “With millions of low-income households running out of essentials such as food and heat, and food bank usage at record levels, it is clear that the system is failing,” he said.
The two charities calculated the weekly cost of basic living at £120 for a single adult and £200 for a couple, based on a basket of goods and services including food, energy, travel, mobile phone and internet usage. , as well as smaller items like toothpaste and dishwashing liquid.
By comparison, even after the 10.1% increase in benefits in April, the standard universal credit allowance – the part of the monthly benefit payment intended to cover basic living costs – will be £85 a week for a single adult. over 25s (£35 less than charity estimates) and £134 a week for a couple (a difference of £66).
Charities are increasingly alarmed by the unprecedented scale and depth of poverty witnessed in food banks, warm rooms and counseling agencies this winter. Millions of low-income households were left unable to pay even the bare essentials as the cost of energy and food soared, leading to overwhelmed emergency welfare services and shocking examples of extreme hardship.
They say the cost of living crisis has exposed a disastrous long-term erosion of benefits, whose value has fallen to a 40-year low in real terms as a result of freezes and cuts. This has led to rampant food insecurity, children showing up to school hungry, and the phenomenon of people with disabilities risking their health because they can’t pay their energy bills.
Kissack added, “It’s time to build a system that is tested against needs – where the support people receive is tied to the actual costs of essentials. A system where every family has enough money to survive, and as a nation we’ve bound to history the scourge of people having to skip meals or turn off essential appliances just to survive. ”
In reality, more than half of households with universal credit receive even less than the £85 base rate because of monthly caps and benefit deductions worth hundreds of millions of pounds a year, say the charities. A single adult facing deductions would normally see their basic allowance drop from £85 to £64 a week.
Trussell Trust chief executive Emma Revie said that even when its food banks have helped vulnerable clients claim their full entitlement to benefits, in many cases their newly increased incomes still did not cover their basic living costs. “People cut and cut, but you can’t budget if your budget isn’t enough,” she said.
The charities say there is broad public support for raising the base level of benefits, having conducted surveys that show that nearly three-quarters of the public agree that universal credit rates are too stingy. There was majority support for raising universal credit base payments, even among 2019 Conservative voters, of whom 62% supported an increase.
The cost of raising benefits under the charities’ “essential guarantee” means the idea may struggle to gain traction with major political parties. It would cost £20 billion a year, although the charities argue it would lift 1.7 million people, including 600,000 children, out of poverty and, over time, bring savings through lower NHS demand and other social benefits.
The two charities believe there is value in enshrining in law the principle that benefits are aligned with a robust and independent estimate of actual basic living costs. They say defining benefits has become mostly a political exercise out of touch with the realities of life for those who need to claim them.
Kissack said it was remarkable that the benefits were never linked to the real cost of basic needs for low-income families. A political consensus was established two decades ago to protect retirees’ basic living standards, and a similar agreement is now needed to support people of working age with low incomes, he said.
A government spokesman said he believes work is the best way to increase income. “We have consistently used inflation figures to increase benefits, including in cases where benefits are increased beyond the inflation rate at the point the increase begins, as happened in 2012, 2015 and 2020,” they said.
“We are raising benefits and state pension by 10.1% in April, but we recognize the pressures of rising costs of living, which is why we will also be providing £1,350 of direct and targeted support to millions of vulnerable families. in 2023-24. . Additionally, our family support fund continues to help people with essential expenses.”