A single person on universal credit now receives 20% less than what it costs just to eat and keep warm

The UK’s income safety net is in tatters.

In principle, anyone without income can escape destitution by claiming universal credit or, if above pension age, pension credit. In reality, the value of working-age benefits has fallen to such a low level relative to need that they can fail to meet the most basic requirements of daily life.

Worse still, the majority of people without earnings will have to live on even less than these inadequate standard entitlements, for example because they exceed the benefit cap, because a family has more than two children or because the Department for Work and Pensions deducts money to repay loans, often taken out to stay afloat while waiting for universal credit to start.

The longstanding problem with the system is that it doesn’t systematically cater for need. There is no single measure of subsistence.

I recently compiled a report for the Financial Fairness Trust, in which I calculated the value of benefits relative to two key essentials of life: food and energy. My analysis shows an unemployed single adult now needs 20% more than they receive in benefits to cover even their most basic costs.

Meeting food and energy costs

An unemployed single adult on universal credit currently gets £84.80 a week to live on (not including rent). Research on minimum household requirements shows, however, that in order to eat healthily in a warm home, a single person needs £104 for food and domestic energy alone.

Receiving 20% less than this basic minimum means people have to cut back drastically not just on food and energy but also on meeting many other needs – including clothing, travel, basic toiletries and household goods.

On average, households in the UK allocate just 20% of their income to food and energy in the home. And yet, even before the cuts the government started making to benefit levels from 2013, a single person needed to spend an unrealistic 73% of their benefits to meet these food and energy costs.

My calculation shows that, one decade on, this figure has now risen to over 120%. This makes a mockery of the idea that benefit levels are adequate for even the most frugal of lives.

Low for years and getting worse

After the second world war, the “national assistance” benefit was set to cover average working-class spending on some basic items. Since then, minimum support levels have mainly been uprated only by the general level of inflation, and not always in a way that reflects the actual increased costs of these items. This financial support seems increasingly ungenerous in a society whose living standards are unrecognisably higher than in the 1940s.

Continued…

For the full article by Professor Donald Hirsch visit the Conversation.

Notes for editors

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